Your CEO resigns without warning. The company is sold when you didn’t know it was for sale. Management announces a dubious pivot. For many employees, it seems impossible to make it through a few years, never mind an entire career, without encountering a destabilizing event.
What leadership teams often fail to appreciate during times of upheaval, however, is how jolts from negative events continue to ripple through an organization long after the initial shock, says Peter Atwater, a financial researcher, consultant, and adjunct professor of economics at William & Mary and the University of Delaware. Atwater originally developed a framework to predict how moods dictate behavior to move markets. But in his new book, The Confidence Map: Charting a Path from Chaos to Clarity, he writes that framework also applies to the way that people behave in many other realms, including in the workplace. And he’s found that what employees do when they’re fearful can have profound consequences on a company’s success—yet CEOs don’t do enough to predict and contain employees’ reactions.
Atwater tells Fortune that no matter how brilliant a CEO’s strategy, employee confidence about their employer’s future (or lack thereof) after a disruption is what determines whether a company will begin a bright new era or enter a dark death spiral.
There are at least five stress responses that can influence how employees process doubts and fears, Atwater writes in his book. The first two—fight or flight—are widely known. But the other three—follow, freeze, and f*** it —are less discussed, but still common. Rather than anticipate any and all of these responses from employees, leaders often mindlessly expect them to fall in line behind the C-suite, to trust management and “follow,” says Atwater. The reality is not so simple.
Here’s what each of the “five f” responses look like:
Fight: Inside a company reeling from an internal change—let’s imagine a firm that has just announced a merger—the fight response may see employees turning up at town halls with tough questions for leadership or signing a petition outlining the policies and perks that they’d like to see preserved. On the surface, the “fight” reaction sounds negative and may even trigger defensiveness from managers or upper leadership teams. At its heart, however, the “fight” impulse is about engagement in the face of a threat, and can even be seen as a good thing. It’s a sign that cynicism remains at bay.
Flight: The flight reaction is, of course, driven by a desire for just the opposite: it’s about finding safety through disengagement. During a crisis at work, this response is measured by attrition and it can happen at any level of a company. Some top managers will not stick around to see how a new CEO leads, for instance, or whether a company can weather a major downturn—they’re tapping their professional contacts and sending out their résumés asap. Notably, deciding to take flight and quit sometimes follows an initial attempt to fight.
Follow: Other people naturally look for someone to follow when they’re feeling unsure about what to do next. (Quit? Cry? Carry on as if nothing has changed?) CEOs want to be that trusted authority, but that’s usually an unrealistic expectation, says Atwater, since CEOs are so psychologically distant from employees. Instead, most workers turn to their immediate supervisors for reassurance, which is why he says rogue or angry managers can have an outsized influence on a company’s business during critical periods. The same is true for union organizers who emerge within a company’s ranks during times of crisis.
Every organization also has certain employees who may not be in management but are still deemed unofficial “leaders” by their peers, says Atwater. Knowing who those people are and reaching out to them can be critical when a firm wants to influence how messages filter through a workforce.
“The challenge for leaders is to appreciate that there may be competition in terms of workers saying, ‘Okay, who do I follow?’” he says.
Freeze: Employees of any rank—including CEOs—can “freeze” in fear, becoming less productive and unable to pivot quickly to meet a new challenge following an unexpected change. “They become paralyzed in the job,” Atwater tells Fortune. “They're not sure which way to turn next.” He compares this response to a common experience reported by people recalling panic attacks: The circumstances of a situation feel overwhelming, he says, and “the mind keeps returning to the source of the stress.”
Instead of embracing a new system for organizing work, or concentrating their sales efforts on a potential new market, for example, frozen employees keep doing things the same old way, inadvertently putting their jobs and the company’s success at risk.
F*** it: Finally, the “f*** it” response is perhaps the most dangerous of all options. In the workplace, the f*** it cohort will actively undermine the company when under stress.
While f*** it and fight reactions may sound similar, fighters—no matter how angry—look for ways to engage with a problem constructively. Those who take a f*** it attitude do not pretend that they want to improve a situation. They might leak files, bad mouth their employer to the press, slack off until they’re fired, or sabotage a team effort.
Again, the employee with the power to inflict the most pain with a f*** it reaction is a middle manager or senior leader. “That can be very damaging to a company when you start to have leaders who feel disempowered and become nihilistic, and they're poisoning the corporate environment,” says Atwater. “There can be no place in an organization for the ‘f*** it’ leader.”
The importance of acting fast
Today, employees are grappling with a few universal angst-triggering issues, like the rise of potentially job-stealing A.I. or, in the shorter term, return-to-office mandates. As anxiety around those issues comes to a boil, companies need to stay attentive, Atwater cautions.
Issuing in-office mandates, he says, has people asking, “Okay, do I want to continue to work here? Do I quit and look for a new job? Do I stay at the job and sabotage what's going on around me?”
He adds that he can’t overstate the importance of communicating with speed and clarity following a shift or transaction that might lead to uneasiness, the time when a company needs workers to follow. Leaders should acknowledge that the company’s actions have created stress, he says, and talk about what the company will do to help people feel more certain about their jobs.
“The faster you can deliver certainty to individuals, the faster the healing process can begin,” he says.
Companies also need to bear in mind that one message to staff will not be enough to soothe frayed nerves during trying times. When CEOs and the C-suite team move on quickly—becoming preoccupied with an integration strategy or restructuring, for example— they leave employees to read the tea leaves and settle on their own path forward.
That’s one way to sleepwalk into trouble.
