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in revenues and reduction in costs that most mergers aim for, “83 percent of all mergers and acquisitions failed to produce any benefit for the shareholders, and over half actually destroyed value” due to a weak execution culture.25 Finally, a large study across the world’s ten leading economies compared companies with high employee engagement with low-employee-engagement firms. It found that over a three-year period, the first group increased their operating margin by 3.74 percent and net profit by 2.06 percent on average. The second group decreased these bottom-line indicators by 2.01 percent and 1.38 percent respectively.26 These differences are substantial. But they still don’t give a full accounting of how exactly all these disengaged employees translate into lost revenues and increased costs. And, indeed, all this may look like a necessary cost of doing business, something akin to the accidents that accompany ownership of a fleet of corporate cars. This interpretation would be easier to accept if we knew nothing about the costs of one major disengagement-related phenomenon. To discuss it will require a detour to the world of psychiatry.

HOW MUCH YOUR STRESSED-OUT PEOPLE

COST YOU—BEYOND THEIR SALARIES

Anecdotally, workplace stress has become a redundancy. But is this ubiquity backed by numbers? Unfortunately, yes.27 According to the National Institute for Occupational Safety and Health, stress affects 40 percent of American workers and is the number one cause of worker disabilities. We will describe in a moment what the sources of workplace stress are, but one thing is clear: Most of the symptoms are highly unpleasant, and we react to them with the instinctive impulses of flight or fight.

We try to flee the people and events causing us stress, hence, the absenteeism and lost productivity. We fight back by striking out (albeit usually not physically) at what we believe to be the causes of our stress—whether those are coworkers, managers, or even the entire company. That is what Gallup’s actively disengaged 14 percent are doing. This, once again, leads to lost productivity—$328 billion per year for the U.S. economy according to Gallup’s estimate.28 And when we are unable to literally flee or fight, we may “escape” by smoking, drinking to excess, and even abusing drugs. All this flight and fight is accompanied by the evolution-conditioned responses of elevated adrenaline secretion, blood pressure, and heart rate. But while all three are momentarily good if you happen to be fleeing a saber-toothed tiger, they damage our health when they become chronic companions. Unsurprisingly, workplace stress is recognized today as a key contributor in 75 percent to 90 percent of all primary-care doctor visits. And the longer these stress responses persist, the more damage is done to our health.

In the short term, workplace stress leads to mundane “modern” diseases, such as stomach disorders, back pain, musculoskeletal problems, headaches, skin problems, loss of sleep and energy, and emotional distress. Because stress weakens our immune system, it even makes us susceptible to catching colds. And if stress persists over a long period, the problems get less mundane and often lead to heart disease.

The conclusion is grim: Stress-related problems are not only expensive—even if mostly unseen today by traditional accounting systems—but also lead to avoidable human suffering. So what causes workplace stress?

Decades’ worth of psychological research provide us with a good understanding of the mechanism. It all begins with events and situations in the workplace that we perceive as either physically or psychologically threatening. Psychologists call them “stressors.” Among the stressors are such things as increases in the amount of work or of work demands, or uncertainty about what needs to be done. In addition, stressors include all the constraints and interpersonal conflicts that prevent employees from doing a good job. The reader will, we fear, recognize many of them below:

Someone interfered with your work.

Others took resources