How to Create Psychological Safety in Your Small Business

by Corey Philip //  November 15, 2022

Most employees have an innate fear of being ridiculed or judged if they share their ideas. So, they often withhold brilliant insights that have the potential to give a small business a competitive edge.

That is why creating psychological safety for your team is so essential!

Psychological safety is when you are able to speak, behave, and be who you are without worrying about being criticized, embarrassed, or rejected for doing so. When there is psychological safety among the employees, they trust each other without any judgment. They can make mistakes without being labeled and express their thoughts without being humiliated.

You can also create psychological safety in your small business by being more considerate, authentic, vulnerable, and empathetic. Ensure that you promptly deal with issues, spread workloads, listen actively, embrace transparency, create a sense of belonging, recognize excellence, and welcome feedback.

Research studies have proven that employees who feel emotionally vulnerable are far less driven and productive than those who work for businesses that provide psychological safety. Furthermore, dealing with the demands of running a small business can sometimes feel daunting, especially if your team is not meeting your expectations because they feel insecure.

So, read on if you want to create a thriving business with a happy team!

1. Focus on Being Considerate and Sincere

Authentic and considerate interactions with your team create a strong foundation for psychological safety, strengthening your interpersonal relationships and building trust. Most importantly, sincere and considerate engagements create a caring business culture. You will be less likely to lose valuable members of your tight-knit team.

2. Embrace Vulnerability in Your Business

It’s perfectly natural to feel overwhelmed, anxious, and vulnerable at times, especially if you need to keep a small business afloat and manage a large workload. Studies have proven that showing how you feel is a constructive way to deal with anxiety.

As they say: vulnerability is strength.

Besides reducing your level of anxiety, being open about your feelings with your team normalizes feeling vulnerable, which adds an extra level of psychological safety.

3. Manage your Employees with Empathy

Nothing destroys interpersonal relationships as quickly as a passive-aggressive boss! So, lead your team with a level of self-awareness and empathy. Employees who feel valued and respected as human beings are far more likely to go the extra mile, and they will feel compelled to exceed your expectations.

4. Deal with Problems as they Arise

It’s a fact of life that people make mistakes, and things go wrong. Thus, knowing how to deal with it constructively is essential to managing a successful small business. So, if an employee makes you aware of an issue in your business, or a mistake that they have made, your reaction to hearing the news is essential.

Instead of playing a "blame game," thank your team members for having the courage to let you know and address the issue in a productive way to future-proof your business.

5. Spread Workloads Out Fairly

Unlike large corporations, small business teams must contend with fulfilling various roles and managing a substantive workload, often leading to burnout and losing valuable employees. Therefore, it’s vital to manage your team's workload so that they equally share responsibilities and no one feels overwhelmed.

The most efficient ways to do that are to schedule weekly team meetings to discuss the following week's expected workload. Have regular one-on-one sessions with your team members, and devise individual work plans so everyone's roles and responsibilities are clearly defined.

6. Allow your Team to Think for Themselves

It’s only natural to want to instantly resolve your team’s problems when they ask for your help. However, allowing them to create their own solutions is far more empowering. Problem-solving is an invaluable skill, especially in small businesses with severe budget constraints, so enabling your team to generate new solutions is essential.

7. Become an Active Listener

Active listening is the ability to solely focus on what a person is saying and demonstrate that you clearly understand and value their verbal and non-verbal communication. It is an effective way to create psychological safety for the speaker if your feedback is respectful and not belittling. Then, they feel heard and will most likely feel comfortable engaging with you.

8. Make your Team Feel like they Belong

Apart from love and acceptance, Maslow’s Hierarchy of social needs includes a sense of belonging and the need to be part of a family or a community. Creating a business that feels like belonging to a family is an effective way to build enduring interpersonal relationships with your team.

9. Collaborate with Poor Performers 

Dealing with poor performance issues can be challenging, especially if an employee becomes defensive when faced with criticism. Although, with a non-judgmental mindset, and a collaborative approach, your team members will be more open to addressing their poor performance issues.

10. Recognize Outstanding Achievements

It’s imperative to acknowledge and reward loyal employees who have contributed significantly to your small business's success. Especially if they have sacrificed time with their families and worked long hours to complete a challenging project.

11. Create Strong Team Players

The most effective way to boost a sense of psychological safety is to focus on creating a solid team of employees who trust and support each other. So, keep that in mind when hiring new employees, and ask them to provide an example of how they previously worked in a team.

12. Embrace Transparency

Transparency about all aspects of your business is an effective way to build trust with your employees. Being open and honest makes them feel psychologically secure, especially if they suffer from anxiety about your business’ sustainability.

13. Welcome Feedback from your Team

Communication is a two-way street, so it’s essential that your team feel comfortable in providing open and honest feedback. Besides providing invaluable insights that can streamline your business operations, welcoming input from your team is one of the cornerstones of psychological safety.

Final Thoughts

Creating a robust level of psychological safety in your small business, on top of all your other responsibilities, can feel overwhelming. However, it is vital to keep in mind that your employees truly are your greatest asset, and they need to feel secure to be productive members of your team.

(Related article: How Managers can Improve Influence with Body Language)

About the author

Corey Philip

Corey Philip is a small business owner / investor with a focus on home service businesses.

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