Find your business’ energy leaks

Energy leaks come in all forms and descriptions: energy leaks in our homes and, of course, in the Gulf of Mexico. Oil is the energy that runs our cars, homes and computers and any leak is wasteful and destructive. We know that a leak wastes a precious and costly resource and don’t tolerate energy leaks from any place along the supply chain.

But do you realize there is a good chance that your organization is also leaking energy?

The leaks I am referring to come from “people energy.” The energy of employees drives the success of every organization. When people are fully engaged and able to optimize their passion and enthusiasm, organizations soar. Success can only come from the energy, creativity and commitment of the people.

Do we really understand the cost of energy leaks inside organizations?

Two types of leaks

The first type of people-energy leak involves dysfunctional behavior, which is almost always present everywhere. The ability of individuals and teams to work together in a positive manner is critical to all organizations, and the degree to which dysfunctional behavior is tolerated or ignored creates energy leaks.

Management guru Peter Drucker said “the only things that evolve by themselves in an organization are disorder, friction and malperformance.” He was reminding us that people issues must be addressed to head off problems caused by dysfunctional people, teams and situations. Performance is the most costly victim of unaddressed people problems.

When there is conflict, mistrust, poor communication, inability to collaborate, lack of respect, unproductive competition, unnecessary drama and emotion, productivity is reduced, dollars wasted, opportunities lost. Another energy leak opens up when there is an inability to clearly communicate between leadership and staff.

When teams don’t work well together, it makes everyone’s work life unpleasant, and the inability to collaborate is a lost opportunity on many levels. Teams may split into factions taking opposing positions. Individuals and factions can create barriers to moving forward. Meetings take more time and may require additional time to finalize a decision. When a team member is reinventing the wheel instead of working with colleagues, the solution may not include all the expertise available. When teammates do not trust each other, the opportunities lost are vast.

Another major source of energy leaks is fear. In today’s economy, fear is rampant. W. Edwards Deming, an early systems thinker, believed that managers have many opportunities for improvement. In Deming’s 14 points for management transformation, published in 1993, point number 8 is “drive out fear, so that everyone may work effectively for the company.”

When people are fearful, undesirable outcomes happen. More mistakes are made and their lessons not learned; communication to leaders may be given a positive spin; and the people generally mistrust the system. Performance data may be warped when those reporting are coming from a position of fear. This creates confusion, frustration and wrong decisions. This particular energy leak is like leaving a window wide open in below-zero weather.

Fixing the leaks

Why should you care about fixing energy leaks in your organization? Energy leaks affect everyone, and they will not go away by themselves. They will only continue to fester and infect more and more people. Some team members who are sufficiently unhappy will find a way to leave. If employee satisfaction is to improve, people problems have to be addressed.

We are in a transition period as we adjust to reduced resource levels. This is an adjustment that will take time to complete. You may wish for short-term results, but is unlikely to happen.

With employee satisfaction at record low levels, every leader must consider how dysfunctional behavior and fear are impacting performance. In order to reduce fear and create a more positive work environment, it is up to managers to help the people define priorities and focus on the right work. A critical need at this time is to re-inspire people and reclaim their energy and commitment. This alone can close many energy leaks and create a more positive work environment.

Follow Peter Drucker’s advice and pay attention to helping the organization adjust and find a new path to performance. Retreats, team planning and other collaborative activities are often viewed as a luxury. I hope I have helped debunk that attitude. Focusing on the needs of the people, adjusting goals and defining the right work are a powerful way to improve performance.

Shirley Esterly is a master facilitator and systems thinker who works with clients to build sustainable business practices. She can be reached at

sae@quantumwest.com.

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