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  • Writer's pictureFred Petito

The Connection Between Positive Psychology and Leadership Effectiveness


What is positive psychology and how does it relate to leadership?

Positive psychology is a subfield of psychology that focuses on helping people thrive and achieve well-being. In the context of organizations.

it means helping people improve performance by focusing on what’s working and emphasizing the strengths of people and teams. It came out of the concern by some in the field that psychology (including organizational psychology) had become too focused on the negative aspects of the human experience and too focused on addressing disorders, etc.

At the core of positive psychology is the idea of thriving and finding happiness and well-being through 5 different pathways (PERMA):

  • Positive emotions

  • Engagement

  • Relationships

  • Meaning

  • Accomplishment

Since organizational behavior and performance are highly influenced by the behavior of its leaders, there is a connection between leaders who embrace positive psychology principles and the performance of their employees and teams on measures such as engagement, motivation, and innovation.

What is a positive leadership style?

While there is no one definition of a positive leadership style, the concept typically embraces leadership attributes such as

  • Experiencing, modeling, and purposefully enhancing positive emotions

  • Showing a keen interest in an employees’ development as well as the bottom line

  • Embracing a high degree of self-awareness, optimism, and personal integrity

There are several leadership styles that are similar to a positive leadership style:

  • Authentic Leadership Style - authentic leaders are transparent in their workplace relationships and they remain honest when sharing their own thoughts and feelings. This may include offering constructive feedback to team members when necessary, as well as admitting when they're in the wrong.

  • Transformational Leadership Style - a transformational leadership style inspires employees to strive beyond required expectations to work toward a shared vision, whereas transactional leadership focuses more on extrinsic motivation for the performance of specific job tasks.

  • Visionary Leadership Style - a visionary leader ensures the vision becomes reality by stating clear goals, outlining a strategic plan for achieving those goals and equipping and empowering each member to take action on the plan at the organizational, team and individual levels.

  • Coaching Leadership Style - coaching leadership style is defined by the leader’s ability to see the strengths and weaknesses of individual team members so that the leader can help each individual grow and succeed.

What role do an employee’s or team member’s strengths play for someone who embraces a positive leadership style?

This is a really interesting area of positive leadership and I believe where most of the real impact comes. But there’s a distinction between personal strengths and character strengths:

Strengths as defined by the positive psychology literature are not skills or innate abilities. Skills of course are very important to a person’s success and overall work performance and have a role to play in positive leadership.

For example, an employee might have skills or attributes that they possess innately or acquired from experience – for example, someone may be a very compelling presenter, or a great designer, or a beautiful writer – these are important personal attributes that a leader who practices positive leadership needs to be aware of.

A leader who knows how to accentuate and activate these skills of an employee instead of say focusing on the negative aspects of their work can be very motivating and inspiring. This is what is called strengths-based leadership or Appreciative Inquiry – in other words it focuses not so much on what is, but on what could be achieve by activating a person’s unique abilities

Character Strengths in Positive Leadership - When it comes to strengths in the context of positive psychology, character strengths are a little more subtle. One of the key contributions made by positive psychology to leadership is the idea that in order for leaders (and organizations) to flourish, they need to reflect on, consider, and identify their core character strengths — these are positive traits expressed through a person’s thoughts, feelings, and behaviors that are universally recognized for the strength that they create in individuals and communities.

Character strengths are things like:

  • Perseverance

  • Integrity

  • Enthusiasm

  • Kindness

  • Social intelligence

  • Optimism

Positive leaders know how to apply these character strengths to leadership and management situations in order to create more self-aware and emotionally intelligent employees, teams, and organizations. Character strengths matter because they are the psychological vehicles that lead people to engage in positive ways and achieve goals in the face of obstacles

Research shows that people who use their strengths experience greater levels of happiness, self-esteem, are more engaged and more satisfied at work, are more innovative, and achieve more goals. For leaders then positive leadership can have a significant impact on culture and ultimately the competitive success of their organization

How can a leader or organization develop a positive leadership style?

  • First - organizations need to abandon the traditional approach of focusing on what’s not working when leading people and teams, and emphasizing strengths, contributions, and what’s working.

  • Second – they can start using assessment tools like the VIA (Vales in Action Inventory) Character Assessment, or Clifton’s Strength Finder to help executives not just focus on competencies and skills, but also on character development

  • Third – train managers and leaders to give their people and teams feedback and to shift their focus from preventing mistakes, to helping people learn from their mistakes.

  • Finally – encourage employees to discover their strengths and the work they love to do, as opposed to what the organization wants them to do

Can you share examples of companies that have embraced positive leadership, and what kind of results they achieved?

Linkedin – linkedin puts positive psychology principles at the core of the people development practices by stressing individual transformation as core part of their culture

o A key feature of this practice is less reliance on traditional HR frameworks (ie, competencies and skills) and a model that encourages compassion by guiding managers to act in a more thoughtful way that embraces people’s motivations, emotions, strengths and challenges

o As a result Linkedin consistently ranks in the top 10% of employee engagement

Hilton Worldwide – is another example. Of course Hilton is in the hospitality business, so it’s different from a tech-driven company like LinkedIn.

What they have done that is so interesting is that they have made positive psychology principles the center-piece of their customer experience strategy. They do this by creating a culture that is grounded in understanding and elevating the strengths of their individual employees and encouraging them to engage their customers, and each other, with their authentic personality.

This is embodied in their guiding values of FACT

  • F – friendly

  • A – authentic

  • C – caring

  • T – thoughtful

These principles are not only part of Hilton's cultural DNA, but they are also carried through to their customer-facing brand promise “Making You Happy Makes Us Happy”

Another example is Toyota – Toyota as an organization is committed to “putting customers first” and to “putting people first”

Implicit in this mission statement is a goal to serve society as a whole, which is deeply rooted in Toyota's values. This is brought to life ​​through the company’s long-term sustainability strategy but also in its commitment to produce “mass happiness” through mobility which is the belief that mobility – in its different forms – can provide people with moments of intense happiness.

In fact, a core pillar of Toyota’s long-term vision is to create mass happiness through sustainable change:

  • Developing technologies that reduce our dependence on fossil fuels

  • Making electric vehicles that help stave off climate change

  • Using new technologies and designs to achieve the goal of zero traffic fatalities

  • Working to build something they call Woven City, a hyper-connected and sustainable city of the future


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