The Entitlement Virus Is Killing Your Company

“Entitlement and privilege corrupt.” — Vice Admiral James B. Stockdale

One quiet Saturday afternoon, I was sitting at my desk at the far end of what I assumed was an empty office with just me there. As I was working, I heard the printer down the hall spitting out documents. I looked at my computer to see that I hadn’t sent anything to the printer. I thought maybe it was malfunctioning, so I decided to take a look. Only one other office had its lights on. I moseyed over to where the printed documents were spitting out to see what was going on.

It turned out that one of my employees was about to resign and start his own company. He was planning to compete against us, and he was making copies of our proprietary business documents. Apparently, he thought he was entitled to take what he wanted. Had I not been there, this employee’s sense of entitlement would have resulted in our confidential information, which I had trusted him with, being taken.

The sad fact is that 95 percent of all companies experience employee “theft” of some kind. It may be as small as employees taking home office supplies, or it could be as serious as millions of dollars embezzled by a trusted bookkeeper.

Entitlement is a Serious Matter for Your Business.

A sense of entitlement thwarts you, your employees, and your company from meeting the challenges of competition and growth. In his transformational, still relevant, 1993 book, Stewardship: Choosing Service over Self-Interest, Author Peter Block writes, “At the heart of entitlement is a belief system that my needs are more important than the business, and that the business exists for my sake.”

I’ve dealt with this issue myself when a downturn in business during the Gulf War made me want to keep my employees at any cost. But, as I learned, the need to nurture familial-type relationships with employees was a double-edged sword.

When I related to my employees as if they were members of my extended family, I made it nearly impossible to hold them accountable for the things I needed from them. That created a terrible model for getting important work done —not only with my longtime employees, but especially with others who had joined later and realized this was a place where you didn’t really have to work very hard, be on time, do what’s promised, or even complete assigned duties with any degree of enthusiasm or integrity.

It took me some real reflection, but I realized, finally, that I was the original source of entitlement in my company – it was my fear, thinking and actions that created it.

What Is Entitlement, and Where Does It Come From?

Anyone who has ever owned or managed a business has likely experienced the impact of entitlement and wondered what to do about it. It’s a covert issue that can be difficult to recognize. Entitlement is most noticeable when leaders appear to be doing everything they can possibly think of to keep their employees satisfied and stay with the company, while those same employees demand more from the employment relationship and then withhold their commitment and performance if they don’t get it.

Entitlement will prevent you from executing your strategy, but it’s merely the symptom of more dangerous underlying conditions. Employees who think they are entitled often believe they are victims of management exploitation or mistreatment. Left unchecked, entitlement can result in covert acts of revenge. Therefore, it’s important to understand what’s at the source of your employees’ entitlement thinking. Your company’s future depends on it.

Patriarchy Is at the Root

Entitlement Virus can be attributed to two issues:

1. The fear of losing, which makes clients, employees, and others more important than the business.

2. A pretense of leadership that claims employees are more important than management, although, in fact, management furtively believes chiefly in its own entitlement. Entitlement is the result of a patriarchal belief system that most of us share—a belief system often designed around financial control and the idea that you must maintain a clear line of authority to operate your business: Entitlement implies that if you’re the boss, you are endowed with special privileges that others don’t have, and it arises when management wants to avoid being seen by employees as taking advantage of the system for their own gain.

Don’t get ahead of me here – there’s more for you to consider…

To believe in your own entitlement as a leader, you must first operate under the (superior) assumption that you’re making all the (mostly financial) sacrifices and that, therefore, you should be entitled to something extra. After all, it is your company. But, at the same time, you are trying to hide that you’re doing exceedingly well financially; you might even become indignant if someone suggested that you were making all the money and not paying others what they “deserve.”

Finally, you might be telling yourself that if employees knew how much you were “raking in” compared to what you pay them, they just might up and leave. All this kind of thinking allows you to prolong the fiction that no such issue exists. And that will come back to bite you because you’re only fooling yourself.

In reality, you ARE entitled to something special. You ought to be making significantly more money than your highest-ranking employee. Why are you trying to justify your salary to yourself? When you have a good year, do you jack up everyone’s salary? No, you don’t do anything of the kind. Instead, you find a way to give people a nice reward along with verbally demonstrated appreciation. And that’s exactly what you should do, not go off half-cocked out of guilt, trying to make it up to others for your good fortune. That’s just another pretense of leadership, and it’s the pretending that is hurting you.

Even if employees come and tell you that they think they should get a raise, having your best year in business doesn’t mean you have to start overpaying employees. Once you overcompensate by raising a salary, you can never bring it back down, if necessary, without consequences.

Who Has the Entitlement Virus, and What Does It Do to Them?

So, to paraphrase my friend Peter Block, the viral ‘meme’ that best encapsulates the Entitlement Virus is “The employees’ needs are more important than the business.” As for who has been infected by this viral thinking, the answer is: business owners/CEOs who are trying to prevent employees from withholding their efforts unless they receive extra perks. Employees will know when you’re trying not to lose business, not lose good employees, not lose your best clients, or not lose face.

Managers who are infected by the Entitlement Virus think they’re doing what’s best for the company by overlooking infractions such as coming in late or taking longer lunch periods. These are the things that my clients complain about most. What’s the big deal with a little tardiness, they ask themselves, or missing a client’s deadline, or helping yourself to a pencil or a pad of paper for your kid’s homework? The answer is the loss of integrity. Little infractions turn into huge issues over time.

But the real cost of ignoring this kind of thinking is that it keeps your organization from operating with integrity. It’s an infected strategy that derails attempts at resolving even the slightest conflicts between you and your employees. When managers believe their own sacrifices entitle them to special benefits, that belief creates feelings of entitlement among the rank and file as well. It’s infectious. Management is the primary source of entitlement thinking, and therefore, only management can transform the negative Entitlement Virus into the positive Empowerment Virus.

The Plan of Attack

To attack the virus of entitlement, take these five steps:

1. First, eliminate the ridiculous conversation that begins, “We’re like family around here.” If I had $100 for every time a CEO told me he or she tried to treat employees like family, I’d be floating on a yacht in the Caribbean. Sure, it sounds good when you say it, and it might seem like it’s desirable to create close relationships because you can make the argument that it feels good to everyone. But the fact remains that most families are somewhat dysfunctional. Why would you want that kind of behavior in your company, too?

All families tend to be patriarchal or matriarchal just by nature. So even with the best of intentions, trying to create a business culture that’s like a family ends up ultimately breeding sibling rivalry, jealousies, and resentments. And as in your family (and in mine, too), accountability is usually absent most of the time.

When employees become familiar with each other, they tend to stop holding each other accountable because nobody wants to step on friends’ or ‘siblings’ toes. Start relating to employees according to their accountability (that is, in the job they hold or the professional role they play) instead of their personality (their privileged position in the company).

The ”vice president of marketing” is an accountability; my Starbucks buddy Anastas isn’t. The big shift usually takes place when you ask employees to make real promises to take real actions and then measure how well they have kept their promises. If they don’t do the job, rather than getting upset, simply be curious. Ask, “What’s missing that kept you from keeping your word?” Then, begin working with the employee to close the performance gap by helping to provide what’s missing. Doing this one thing will cause immense change within your company.

2. Next create a structure for fulfilling promises. When employees know what your vision for your company is and how they contribute to its fulfillment, they can make meaningful promises to take actions that will make a difference on the bottom line. But that requires a different kind of conversation from you as their leader. The first thing to do is knock off all the talk about all your great ideas. Sure, you’re an entrepreneur; you’re going to have great ideas. But you don’t have to blab about them out loud, so stop talking about all the things “we’re going to do” in the future hoping to get employees excited about the future with you. Keep it to yourself, at best it’s confusing.

Focus on your core business issues and start promising the specific measurable actions you are going to take right now. Rather than talking to your employees about what you will do in the future, be an example of what you want from your employees. Managers literally stop the action when they confuse “talking about taking action” with actually taking action. They collapse the two into each other.

For example, you may hold a meeting to talk about how to solve a problem or how you’re going to get a desirable new client, but a week later, you have the same problem because no action has been taken. No one is managing and measuring the promises for taking action; they’re simply “talking about” taking action. So, get into action and hold employees accountable, and then start measuring for what you want. Those are the only things that matter.

More to Come

3. Communicate fully and tell the truth. If you are keeping secrets of any kind in your company (yes, losses, affairs, transgressions, bad behavior toward others), you are building resentment, and feelings of entitlement will emerge. Without truth, employees cannot be expected to act in ways that support your vision.

Instead, they begin to make things up, and what they make up is either not the truth or wrong 99 percent of the time. Do you want that going on in your company? When you withhold information, you teach your employees that withholding is an actual value. Most likely it’s not a value you want. Not fully communicating means you don’t trust anyone with important and sometimes embarrassing information. And if you don’t trust your employees, your employees won’t trust you.

4. Understand that alignment is a leader’s work of art. Years ago, a great coach of mine, taught me that alignment was my principal job as a leader. Nothing moves in an organization unless there is alignment with the vision and mission. Without it, there is no accountability, so no accountability means no alignment. They go hand in hand. You won’t mitigate entitlement if you’re not aligned, and you can’t align if you’re not accountable.

5. Finally, make sure all employees understand that if you can’t count on them to do what they said they’d do, you don’t need them. We hold on to some employees longer than we should. There’s no reason to keep employees who have no intention of keeping their word. But if employees aren’t keeping their word, the first place we need to look is at our relationship to our own word. If what we say and what we do don’t match, people begin to believe it’s not important for them to keep their word, either. You’ll know you have a problem in this area when you notice employees breaking agreements with clients.

When we think we don’t have to keep our word because of our position or rank, we breed the Entitlement Virus. It spreads rapidly and is hard to knock out, even with our best strategies. An entitlement mentality exists, to one degree or another, in every organization. To neutralize it requires that people be put in charge of themselves and be allowed to choose how they will perform. With those privileges come responsibility, accountability, and a purposeful alignment with the vision and mission. However, that presumes that the purpose is well communicated and well understood.

Replacing the Entitlement Virus with the Empowerment Virus

How do we empower? When employees are put in charge of themselves, are told clearly what the purpose of the company is. Or we help define their purpose within the company, when they are allowed to choose how they will perform. Also when they are told that they and their leaders will be held accountable for their actions, they become empowered.

They are responsible for their own future. That creates an Empowerment Virus that employees can transmit and replicate among themselves and that serves as the best counteragent to the Entitlement Virus. Those who won’t commit to accountability tend to self-select out when it’s clear they aren’t on the same path as everyone else.

Your only choice as a leader is to take responsibility for performance and continue to enjoy the benefits of behaving like a conscious leader—or not. Choosing not to perform as promised means you’ll have to accept the consequences of your actions. The Entitlement Virus has the power to prevent any organization from reaching its objectives. When you as the leader can grasp the notion that it begins with you and you are squarely at the source of this issue, you can examine your own conversations around entitlement.

In Summary

To summarize, when managers believe their own sacrifices entitle them to the special benefits of a privileged class, the Entitlement Virus, and feelings of entitlement will show up among your employees. Only by creating awareness of the Entitlement Virus will you be in a position to transform it into the positive ‘Empowerment Virus’ and create a truly winning company.

Dan Prosser is a Houston-based entrepreneur, and CEO of Faster Growth Strategies, LLC, who has built and sold 3 companies. He helps others build and sell their companies. He has extensively researched ‘Best Places to Work’ companies to understand why they do so exceedingly well financially. From that research, he wrote the internationally acclaimed book, ‘Thirteeners: Why Only 13 Percent of Companies Successfully Execute Their Strategy and How Yours Can Be One of Them’. Named one of the top five English language business books at the Frankfurt Book Fair.

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