 
# Leading 100 Billion Neurons

journey into the brain and how this impacts business and leadership

A short eBook based on keynote at the annual symposium of The International Human Resource Community Switzerland, Zurich, May 2011

by Andy Habermacher

Copyright © 2011 by Andy Habermacher

Smashwords Edition

Dicsover other titles by Andy Habermacher at Smashwords.com:

The Electronic Ark

The Fox Factor

Andy Habermacher is a brain leader and a Certified Master Coach. He is CEO of corporate training programmes and also Managing Director of NeuroBusiness Group, Switzerland (see below). He is passionate about people and executive development...and brains.

ctp – leading brains

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andy@corporate-training.ch

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@andyhab

NeuroBusiness Group (NBG), LLC is an internationally recognized executive training and coaching company that brings you cutting-edge training and coaching with extraordinary members and partners worldwide.

Offering unique insights from brain science combined with sophisticated data-driven approaches from organizational psychology, NBG constructs tailor-made programs to suit your company's needs. These methods have been published in "Your Brain and Business: The Neuroscience of Great Leaders" (FT Press, March 2011), peer reviewed by Wharton Business School for the scientific and management content.

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info@neurobusinessgroup.com

The International Human Resource Community in Switzerland is an English speaking professional network of Human Resources professionals with international experience who value sharing ideas and learning from each other. The community provides a platform based on expertise, professionalism and trust which enhances understanding the cross-cultural issues and the global dimensions of our work to the benefit of the members and the organisations in which they work.

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Contents

Introduction

Part 1: The Brain

Slide 1, technology

Slide 2, the magical brain

Slide 3, the Nobel Prize for Physiology

Slide 4, the sea slug

Slide 5, the neuron

Slide 6, neuronal learning

Slide 7, the big parts of the brain

Slide 8, understanding the brain

Part 2: Unconscious Processing

Slide 1, unconscious processing

Slide 2, rational processing

Slide 3, frightening faces (1)

Slide 4, frightening faces (2)

Slide 5, mirror neurons

Slide 6, justification & rationalisation

Slide 7, confirming evidence

Part 3: Brains in Business

Slide 1, fear in the brain (1)

Slide 2, of mice and men

Slide 3, fear in the brain (2)

Slide 4, mirror neurons

Slide 5, what can stimulate fear

Slide 6, the closed door

Slide 7, trust

Slide 8, the dark alley

Slide 9, reward

Slide 10, spheres of impact

Slide 11, CLEARVision

C

L

E

A

R

Vision

Case Studies

Final Words

## Introduction

This short eBook is an introduction to the topic of leading brains, neuroleadership. It is based on a keynote presentation that I gave to the international Human Resource Community in Zurich, Switzerland in 2011and takes us on a short journey into the brain, how it functions and what relevance this has on ourselves, our workforce and corporate applications.

Happy reading and I would love to have any feedback.

Andy Habermacher

## Part 1: The Brain

The brain is a complex organ so the first part of this book needs to start by peering into the depths of our brain and understanding some of the simple biological structures and processes that are enabling us to function. This forms the base of almost all human behaviour so understanding these simple principles will already help to give you deeper insights into the human psyche.
Part 1: The Brain

## Slide 1, technology

 *

In recent years the amount of research done on the brain has mushroomed. This is for many reasons. Firstly the technological advances have been huge and this has meant that there are now numerous ways to peer into the brain and see what is happening from a cellular level to the coloured pictures and scans that we tend to see in most mainstream magazines. We can take pictures of incredible detail and we can see what parts of the brain are firing up to what stimuli. This technology is not only better it is also much, much more accessible and much cheaper. As the technology has become more varied more accessible and easier to finance these technologies have been used in a variety of fields and particularly in such interesting field as behavioural psychology. On top of all of this there is also a huge drive by the pharmaceutical industry to look into the brain to find a cure for some obvious diseases like Alzheimer's but also for clues to such things as dieting and obesity. This has increased the amount of research and related funding to enable us to better understand the processes that are going on in the brain.

Some of this research is inaccessible such as looking at the micro chemical reactions within and between brain cells and some remains very academic and yet where there is great knowledge this is also being "translated" into simple formulations and being applied in different ways. Indeed this has reached the pop science culture with all willing to jump on the bandwagon of all things "neuro". Not only authors and pop scientists but also food producers have jumped on this also with new neuro foods and drinks appearing by the day on the market. All supposedly designed to boost your power and energy through tapping into the knowledge of neuroscience. I remain sceptical, as you should, because sugar can also be described in terms of neuro power but sugar and water is hardly ground breaking technology carefully designed to increase energy in your brain and stimulate your mental faculties.

*Animated GIF source: Wikipedia Commons, Christian R. Linder,  http://upload.wikimedia.org/wikipedia/commons/7/72/Brain_chrischan_300.gif
Part 1: The Brain

## Slide 2, the magical brain

So the brain is a big and complex thing and it consists of 100 billion neurons, brain cells that is, as the title of this book notes. Approximately speaking. To understand the size think of the brain in terms of M&Ms those coloured chocolate covered peanuts. If each brain cell were an M&M how big do you think it would be if it were a cube? 1km3, 10km3 or more? Well much more. It would be a cube of M&Ms 100km3. For those in the USA that is three long islands in New York next to each other and reaching up 100 km which is more than 12 times the size of Mt Everest and is indeed the border of space. For those in Europe it is almost 7 times the size of London again reaching 100 km to the border of space. And every part of that would be filled with chocolate covered peanuts, which represents a brain cell.

And that is not the only complexity because on top of this there are around another 100 billion glial cells, these are cells that support and provide nutrition to the neurons and provide a structural framework and then, of course, blood vessels and supporting structures. That's a pretty complex piece of machinery. Then we have to bear in mind that each neuron has multiple connections. To make it simple we can multiply this by 1000 per neuron meaning that we have 100 trillion connections in the brain. Indeed a lot. Indeed so much that it starts to become slightly abstract concept. Indeed it has been calculated that the amount of possible connections we can generate in the brain is much more than all the atoms in the universe.

But when we are talking about the brain I think it is important to watch how it develops because this, for me, highlights the beauty and power of our brains.

From week 3 in the mother's womb the embryo starts to take on some shape and here you can see a ridge that is the beginning of the spine. The spine indeed being a part of the brain. If you think about it the brain is directly connected to the spine and the spine is indeed a bundle of extra long brain cells stretching down and along the body transporting electrical signals to the rest of the body. Bizarre as it may initially sound this is all part of the brain, technically the central nervous system.

From week 4 you can see small blobs appearing at the top of the early spinal cord and as the embryo grows and grows these blobs also grow and develop into the different regions of the brain and from this the eyes are also produced. The eyes have their beginning in the brain and indeed are also directly a part of the brain with a bunch of nervous connections directly linking the back of the retina to the brain. At some stages of development there are as much as 6,000 neurons being produced each second.

The more fascinating part of he brain's development is the neuron migration: these brain cells are produced along the central canal in the so-called neural tube (the brain at this stage represents a tube) and then, and this is fascinating, at some stage they all somehow decide to migrate and crawl along those glial cells I mentioned, which are the supporting and nutritional pathways in the brain, and find their own positions. This is a little creepy and no one yet knows how this is orchestrated. These cells, billions of them, just decide to start crawling to some seemingly predefined location and start to connect in different ways. They stretch out their axons, their "arms", their connections, and find other cells to connect to and start to communicate by sending biological and chemical electrical signals. These cells then start communicating to each other. After the connections start humming and coordinating they are at this stage wring themselves for the functions we need. There then follows a stage of pruning and a great neuron death as the brain cuts out superfluous connections and neurons.

The process of reaching out and connecting continues for all our life the concept indeed of neuroplasticity, of the ability of the brain to rewire has shown us just how flexible the brain is. Your brain can rewire at any time in your life. This has powerful implications for change management.

These connections and different types of neurons (there are a number of types of neurons classed either on their chemical communication properties or their shape and size) are formed into different regions which have different functions assigned to them and as they communicate, they start to generate a hum of electricity as the biological pathways connect with each other and generate little zaps of electricity (known as action potentials) in the brain cells.
Part 1: The Brain

## Slide 3, the Nobel Prize for Physiology

*

In 2001 the Nobel Prize for Physiology was given to a sea slug. Not any sea slug but the world famous Aplysia, the Californian sea slug that is.

Well no, not quite, it wasn't. It was given to Erica Kandel for his work on the physiological storage of memory in neurons (he was awarded the prize together with Arvid Karlsson and Paul Greengard). Eric Kandel over half a century had followed neuroscience from its infancy to a wide field of scientific endeavour. His personal journey is no less fascinating and he experienced first hand the birth of modern neuroscience and in his brilliance, with the world's greatest neruoscientific minds, helped to forge and form neuroscience, as we now know it. Some of his work all those years ago still carries significance today.

But what was that story of the sea slug?

* Picture source: wikipedia: Front side (obverse) of one of the Nobel Prize medals in Physiology or Medicine awarded in 1950 to researchers at the Mayo Clinic in Rochester, Minnesota. Photograph: Jonathunder. Medal: Erik Lindberg (1873-1966).

The medal design itself is in the public domain in the United States, because it was published before 1923. It remains under copyright in its country of origin (Sweden) until 2037 (the first full year after 70 years following the death of sculptor/engraver Erik Lindberg (1873—1966)). The design is a registered trademark owned by the Nobel Foundation
Part 1: The Brain

## Slide 4, the sea slug

 *

So you may well ask what on earth does a sea slug have to do with neuroscience? And more importantly what does a slug's brain have to do with a human's brain? Well back to where I started: the human brain has 100 billion neurons. That is a lot. An awful lot. How on earth can you decide to pick out a neuron and decide how this influences the rest of the brain? Add to this that neurons are very small things. Particularly human neurons. Very small. And then how do you get a hold of one? Start cutting open humans heads? So when deciding to look more into people heads, Eric Kandel (who had entered into neuroscience because of his fascination with human behaviour - being strongly influence by Freud) decided to take a more unorthodox approach. Most researchers at the time in this field, which was truly in its infancy, were looking to research big animals: mice, dogs and cats. The logic, which seemed to make sense, was that to make sense of brains take a brain as big as you can for it to be relevant to humans.

Eric Kandel though, based on Cajal's groundbreaking work at the end of the 19th century (Cajal was the first person to depict a neuron), noticed that the approach of taking big cells would make the research easier. This combined with other factors such as the fact that the Aplysia only has 20,000 brain cells. Nothing in terms of a brain. But, and this is very important, that meant it was immeasurably easier to identify the specific function of specific neurons and research this. And precisely these factors are what led to the advances in knowledge that led to Kandel being awarded the Nobel Prize in 2001.

The more surprising take away is that brain cells are brain cells and some of the basic functions, at a cellular level are not so dissimilar in humans. The biggest difference is not the make up of individual cells but rather the complexity and the interactions of the human brain.

The organic make up and the simple processes of the organic electricity that flows along these brains cells are basically the same. And this is where it gets interesting because even at a cellular level we can start to see elements of human behaviour influencing us every day

* Picture source: Aplysia Californica, from http://www.biosbcc.net/ocean/fltre.htm Photo by Genny Anderson
Part 1: The Brain

## Slide 5, the neuron

So what does happen in the brain cell and I suppose the real question is how does this help us understand human behaviour better? So let's keep this simple. The brain cell as in the picture above has a body, an axon that long bit reaching out, dendrites the branches at the top and at the bottom the axon terminals, those bulbs at the end that connect to other brain cells (creating synapses). Without going into the complexities of brain cells the process is in essence simple. A stimulus will activate the brain cell, which through a chemical imbalance of charges creates an electrical spark that travels along the axon. This is known as an action potential. This action potential when it reaches a synapse will release a chemical, a neurotransmitter (or inhibitor), which will jump across the gap (the synapses do not actually touch other brain cells - there is a miniscule gap) dock into the dendrites of another brain cell and stimulate another action potential in another cell (or other cells).

So far so good, there is a lot happening at this micro level but the essence is simple. Much research is done at this level. For example the effect of caffeine in coffee can be explained at this level. Caffeine docks on to the adenosine receptors in the brain this means that adenosine cannot dock into these receptors. When adenosine binds it normally slows down the cell and causes drowsiness. With these blocked the adenosine cannot dock and hence caffeine can therefore delay sleepiness. This extra stimulation in the brain can also cause a cascade of other physical processes such as increased heartbeat and hormone release.

However when looking into leading brains at this level we will not go into the chemical processes in the brain though the concept of neuro enhancers has been much discussed in the press in recent years. The idea that we can have super executives by giving them various concoctions of drugs that can boost brain processes. This I, incidentally, believe is a fallacy: in many cases an apple can do a whole host of positive things in the brain and have better long-term effects.

For us some simple experiments run in the 60s show dramatically how our brain operates at a cellular but at a macro level. These highlight where some of the basic human fallacies lie – at a cellular level.
Part 1: The Brain

## Slide 6, neuronal learning

The diagram above shows what Eric Kandel discovered in Ladislav Tauc's laboratory in Paris during a set of experiments at the start of the 60s [1].

Simply they gave an electrical impulse to a brain cell and then noted the strength of the action potential, the electrical current generated by the cell. In the top diagram, you see a classic habituation pattern. If you give an electrical impulse the cell will produce an action potential. If you keep repeating this repetitive electrical impulse you will not see this action potential repeated as you might expect. The cell will start to habituate and the electrical output will become weaker, and weaker. This I find is dramatic. We can see with this simple experiment that brain cells at a cellular level are capable of learning, so to speak. Many of the processes that are happening in the brain are then influenced by this process. The same impulse will, over time, give a decreased output. In a banal situation, like the bathroom light in my second bathroom, this is just an amusing side effect. After moving in we decided to put another light in the second bathroom. Initially we noticed that the light hadn't been fixed, but as such things go I didn't fix it. And over time the importance decreases and I have now stopped noticing that the light is still not done. I have become habituated to it; my whole brain has become habituated to it. It does not react to the unfixed light. The same input has given my neurons a very low output. In more dramatic situations this explains how we stop noticing and even accept situations which in retrospect seem terrible and immoral even. In corporations it will explain the lethargy that may sneak up over time and it will show why a new broom sweeps clean. A new manager does not have habituated brain cells for the same situations his predecessor did. Bearing in mind that this is a natural cellular process, this raises the importance of this effect in corporations.

The second diagram shows the classic sensitisation pattern. A stimulus is given and an action potential is stimulated, this is repeated. So far so good. Now we give the brain cell a shock we give it hefty electrical impulse – it doesn't like this and respectively gives a large output. We then give it the same impulse as at the start and low and behold something happens. The action potential it now generates is much larger than initially. The brain cell has been sensitized. So now we have the same input but a much larger output. What does this mean in terms of human behaviour? It means that now the same stimulus will give us an unusually large reaction. This could be in situations such as the words of an individual or an expression. The word "loss" could give an unusually large reaction in the boardroom (in fact research in neuroeconomics has shown higher activity in the brain when a situation has been reframed as a loss). The word "bank" could give an unusual reaction in most people in memory of the financial crises. The word "terrorist" after 9/11 caused the whole US nation to almost hyperventilate. Sensitization. And something used (manipulatively and ignorantly) by politicians and business people the world over.

The third diagram shows the classic conditioning case. The famous, or infamous, Pavlov's dog, which we have all heard of. Here we have the case that a cell is given a stimulus and it generates an action potential. This is repeated and another action potential is generated. A shock is then given and almost simultaneously the original electrical impulse. This gives the same shock reaction. However, because the cell has now learned to link this to the original electrical impulse, when the original small electrical impulse is repeated the shock reaction is repeated and not the smaller original reaction. So the cell is now reacting to a different situation it has linked the small electrical impulse and is processing it as the shock impulse. That this is happening at a cellular level was a revelation to me. Remember we have 100 billion neurons and these are all at any given time being habituated, sensitized and conditioned.

This is dramatic. It explains a lot of basic human behaviour. Our ability to stop seeing things and accept things, situations, missing bathroom lights as normal. To get habituated to the sound of particular city. As I lived next to a railway line in my youth I soon didn't hear the trains – this is habituation. However some people's brains can react differently some people living next to railway lines may become over sensitive to it.

[1] Eric Kandel's book "In Search of Memory" is a fascinating and very readable journey through his life and spans 50 formative years in neuroscience.
Part 1: The Brain

## Slide 7, the big parts of the brain

So looking at the simple brain cell can start to show us some basic human reactions and behaviours in a broader sense. Now let's look at the brain from a structural perspective. Research over the years has shown us some bigger splits in the brain and how these control what we are doing. I find these are very powerful way of looking at the brain and highlight how our brain functions at a very simplistic way but also gives some clarity as to how our mind prioritizes information.

The simplest way to think of the brain is not in the left right split but in the three-layer split. Daniel Siegel uses his hand to demonstrate this and it is a powerful visual tool to explain the brain:

The bottom layer is the old brain, the brain stem. This sits at the top of the spinal cord and indeed includes the top of the spinal cord which is a very real part of the brain. In this part of the brain, which is the oldest in an evolutionary sense, sit the basic primitive functions of survival and instinct. Body temperature regulation, heartbeat, basic movements, and instinctive responses and reflexes. Indeed this is why in the good old James Bond films he would crack someone at the top of the neck and he would collapse, dead. Indeed this is no myth. This is true.

Over this lies the next oldest piece of the brain the more recent addition and the more advanced the animal the more it will have of this region. This is the inner cortex or limbic system. Though the limbic system refers in most cases to a limited number of structures in this area I like to think of it as the inner cortex. This is deeply embedded in the brain and here sits our emotional centres, our hormonal production and memory amongst others. Here we process happiness, sadness, our hunger is driven from here, as is our sexual desire. Reward and fear and anxiety also.

Over this lies an area known as white matter this you may not know is a thick layer a few inches thick that consists only of axons. Those long strands at the bottom of our brains cells. These are the axons reaching out from the neurons in our outer cortex and connecting to the inner cortex.

Lying over the white matter a few millimetres thick is the outer cortex. The outer cortex being our crowning glory. The seat of "intelligence". This is where our thinking brain lies and where we process our higher functions. It is this that differentiates us from other animals. We have a huge outer cortex; here we process many of our senses but also functions such as language and abstract thought and planning and motor movement and analysis. This is what, until about 20 years ago, we thought controlled the mind. This indeed must have been it was assumed. Recent research as shown this to be a fallacy. Our emotional centres and limbic system exert a much greater influence of your thinking than previously thought. Indeed we can see that our emotional centres control our mind. The limbic system gives the direction and quality of our thought. Not that the outer cortex is irrelevant, it is very relevant but that we are driven by emotions and desires and this also colours our rational thinking in many ways.

Within these large regions we have many distinct structures and many regions which have specific functionality. Some you may have heard of in popular literature. The Amygdale our emotional centres sitting deep in the brain. Our Hippocampus helps us consolidate memories, our prefrontal cortex is a major planning part of the brain and so the list goes on. The outer cortex is split (descriptively that is) into larger regions. The Prefrontal (frontal), the parietal (top), the temporal (side) and the occipital (back). And within these regions we have sub regions which are associated with different functions. These regions in the outer cortex are named after their location and something like the "ventromedial prefrontal cortex" sounds wonderful but simply means: the bit in the front of the brain (pre frontal) and in that region it is at the back of that region and a little to the side. Each of these regions has a function (often many functions together). We have, to name a scarce few, auditory, language, associations, abstraction, impulse control, short-term memory and the list goes on and on and on. The auditory cortex for example will be split into different regions which process rhythm, tone, and location amongst others. You get the idea I am sure.

The structures in the inner cortex are physically different. We can see the forms and the definitions of the outline and often this is also because the types of neurons are different. Remember I mentioned we have different types of neurons.

We will talk about some of the structures over the following pages – this is where neuroscience in business is creating a leading edge indeed. By understanding very specifically what is causing a behaviour or reaction this can lead us to find powerful solutions that lie at the very core of the problem.
Part 1: The Brain

## Slide 8, understanding the brain

So to understand our mind and how we behave as human beings we also have to understand some of our hardwiring:

The brain is focused on survival. This is a programming that goes to the heart of our very existence. Our primary function is to survive and this is highlighted in the priority and the emphasis the mind gives to certain functions. Fear will take priority of anything else. Threat of death is something to be avoided at all costs. For survival we all need to eat and drink and to reproduce hence our fascination with sex and many of our dysfunctional eating habits. Eating in today's society has a huge importance as it does in all societies. Survival is key, survival is priority and threat will take priority in the mind. We should be thankful for this otherwise we would unlikely be here today to talk about neuroscience. Yet this can also trip us up in modern society.

Emotions are an integral part of the brain. The brain functions together as one unit. Though we often, in research, focus on single units and parts of the brain, the brain is always integrated. Emotions are an integrated part of the brain. There is never such a thing as a purely rational way of thinking. Emotions are what connect us to the world and our environment and our society. Emotions are a crucial part of decision making also (see section on Rational Processing).

The brain likes rewards. The brain is also pre-programmed to like rewards. Which doesn't take an awful lot of thought to work out. Yet these in themselves can lead to many distortions in thinking. Drinking excessive amounts of alcohol because of the high it gives, drugs even, smoking also, eating disorders and a preference for eating sugary food because the short high and pleasure this gives the brain. Rewards are great but the mind often thinks in the short term and this will distort our ability to make good long-term decisions. Personally and in business.

The brain is a great simplifier. The brain is a wonderful mechanism and to use those 100 billion neurons efficiently it needs to make shortcuts, heuristics as they're known technically. These shortcuts help us operate effectively in real time. Firstly from the context of our brain cells which will wire together literally to create highways of information and secondly much used pathways and associations to speed up decision-making processes. Right or wrong the brain makes an awful lot of shortcuts.

The brain is structured. The brain has many clear structures which are physically shaped. As previously mentioned the brain stem; various elements in the limbic system are clear physical shapes and regions that are clearly defined. These wire up in very similar ways in all of us. They must indeed for use to function as a human being. Then we have the outer cortex which is split into regions and areas. These are not always clearly defined as with some of the structures in the limbic system. But these regions are also very similar between people for example our language centres in the Broca Area and Wernicke's Area sit in the same places. These may be slightly differently mapped from person to person but they will basically be in the same place and have the same function (there are some unusual cases of hemisphere reversal). This means our brain does have a clear structure and that we can therefore make logical assumptions that are relevant for the vast majority of us.

The brain behaves in "rational" ways, which may seem externally irrational. The brain is a rational thing – but we would have to define rationality to justify that statement. How can a drug addict be rational, you may counter? Well yes, for us as human beings in a given society some behaviours may seem totally irrational indeed. I am merely talking about the brain itself as a closed system and not as a system interacting with the world. The brain says it needs drugs and ranks this above importance or long-term perspectives. This is simply from this brain's perspective the most important thing to do. We have to understand that to solve the issue the brain needs to be reprogrammed. If the brain is weighting drugs as more important than social contexts, it will continue to want to take drugs and drive the behaviour of the person on the outside who, try as he might, will not be able to come off the drugs. These could be caused by dysfunctions, damage, upbringing and lack of development combined with genetic issues: as an example, reduced D2/D3 dopamine receptors in the Striatum (part of the brain's reward centre) suggest a tendency for drug addiction [1].

The unconscious is more powerful than the conscious. I will talk about the unconscious in a few moments. But it is important to understand that the vast majority of information we process is unconscious and unconsciously filtered. We do not actively process the billions of bits of information coming at us every second. The mind makes short cuts and simplifies and all this is done without our conscious knowledge. It is good for us but we need to realise what is happening to understand the brain better and understand human behaviour.

Experiences drive our behaviour. Everything we do creates a pattern in the brain, indeed everything I process creates a pattern in the brain. Even something as cognitively simple as watching football match will involve a range of senses and emotions and that means a wealth of neural processes and stimulation and inhibition in millions and even billions of brain cells. We know what fires together wires together, a stimulus in a brain cell will increase the connection to another cell and could even stimulate new connections to grow. So that simply means our brain is the result of all our experiences and these will therefore drive our future behaviour. What Eric Kandel shows in his research into memory that led to him being awarded the Nobel Prize is that long-term memory is a physical process – the neurons will grow new synapses. So if you remember that football match from 2 years ago (long-term memory), it means that you have literally grown your brain. And we are not even going into implicit memory and unconscious influences that we are processing every second of every minute, of every hour, of every day.

[1]Dalley, J. W., Fryer, T. D., Brichard, L., Robinson, E. S. J., Theobald, D. E. H., Lääne, K., Peña, Y., et al. (2007). Nucleus accumbens D2/3 receptors predict trait impulsivity and cocaine reinforcement. Science, 315(5816), 1267-1270. AAAS.

##  Part 2: Unconscious Processing

This part of the book now looks past the brain as a structure and into some of the unconscious processes. These are after all what are driving a lot of your conscious processes and this is precisely why the unconscious is so vital to our understanding of the brain.
Part 2: Unconscious Processing

## Slide 1, unconscious processing

In this section we will go into the brain from the perspective of the unconscious. In popular science we talk about the subconscious and this may have many mysterious or negative connotations but with a little thought we can see clearly that most things in the mind must be processed below the conscious level – for us to keep our sanity not least of all.

If we think of everything we need to do to keep alive we will quickly realise how much is happening below our conscious level. One simple example is our heartbeat which is obviously controlled below our conscious level. Another is the huge amount of minute adjustments and motor control we need to process to walk let alone walk up stairs. As we approach the stairs we are making calculations of distance and height and mange to keep our balance on one foot while lifting another to precisely the right height – there are millions of calculations going on below our conscious awareness. This we all know – but many will ask what about good old Freud's unconscious? Well what we do know is that, as I mentioned previously, our mind simplifies many processes and there are many influences which happen below our level of consciousness. I will look a little later at justifications and how these are also unconscious. But famous psychologist, Richard Nisbett, showed in his 1977 paper "Telling more than we can know: Verbal reports of mental processes" [1] how unaware we are of our cognitive processes. The example Nisbett uses is this: think of your mother's maiden name. Got it? Now tell me how you retrieved it. You will give me a blank look and simply say something like: "I remembered it because I remembered it". Fine and true but this shows that the intricate workings of the mind, of how the mind activates and retrieves information is below our sense of explicit cognition.

I will outline a couple of examples from the many there are on the following pages.

[1] Nisbett, R. E., & Wilson, T. D. (1977). Telling more than we can know: Verbal reports on mental processes. (A. Devivo, A. Silver, D. Felder, R. Hayward, K. Patterson, A. Redman, A. Buchwald, et al., Eds.)Psychological Review, 84(3), 231-259. Psychology Pr. doi:10.1037/0033-295X.84.3.231

Part 2: Unconscious Processing

## Slide 2, rational processing

The concept of rational processing is a little elusive. In prime because we first have to ask what is rational and we quickly learn that this can only be a standpoint and is anyhow always processed from the point of our brain. Many thing were considered unquestionably rational a few hundred years ago such as flat earth, earth the centre of the universe, etc. are now laughably naive.

I quote a percentage based on Martin Lindstrom's work in his book "Buyology" which goes into consumer decisions but gives us at least, a figure to grasp on to. In buying decisions Martin Lindstrom quotes 85% as the figure. Not for rationality but of irrationality. Better said emotional. That feels about right to me 85% of our decisions are based primarily on emotionality and 15% on rationality. As previously explained the brain works in unison and to separate emotion from ration is difficult. Indeed it is impossible. Antonio Damasio describes in his now famous book "Descartes Error" the (much quoted) case of Elliot, a patient of his, whose ability to make decisions in business had been completely disrupted by lesion in his orbitofrontal cortex which balances emotional input in decision making. This lack of connection to his emotional centres caused his business acumen to go haywire and this previously successful businessman lost the ability to make good decisions losing his job, wife and money in the process. Furthermore a relatively obscure paper [1] published in Indonesia showed a link between mathematical reasoning and emotional intelligence and that this was positively and inversely correlated i.e. that improving emotional intelligence could also improve mathematical reasoning ability.

As I have mentioned previously the brain works as a whole in a human context even mathematics at some stage has a human context but more importantly the brain must be communicating together to perform well. Think of it like a 100m sprinter in athletics. Though a 100m sprinter will generally have large muscles the speed is not driven through large muscles only and not only his large legs. The weight of his body must be driven forward by the speed of contact to the ground and the transfer of energy to propel the body forward requires a strong platform in the body to push it forward – so this requires stiff tendons in ankle and knees but a stable upper torso and stabilising internal muscles to be able to keep the body taught and allow it to be projected like a projectile. There are numerous factors at play just building big leg muscles will only have a limited impact on a sprinters ability to run fast: this is the same as the brain. Different parts will balance and complement certain decision-making abilities with emotion and with intuition.

[1] Rusgianto, H.S. The Relationship Between Reasoning, And Emotional Intelligence In Social Interaction With Mathematics Achievement. Yogyakarta State University.
Part 2: Unconscious Processing

## Slide 3, frightening faces (1)

We as human beings are social creatures. Our evolution has depended on our tribe and on cooperation and in collaboration. Indeed this is one distinguishing feature of human beings (though not exclusively, creatures such as ants and bees show huge amounts of collaboration). We have families and friends and indeed our tribe was our sense of security. This social function in the human brain is hardwired. Children are born with an ingrown sensitivity to faces [1] and appear right from birth – meaning before they have even been sensitized to different emotions and facial expressions – to be able to distinguish fearful and neutral faces or at least learn this very quickly [2] [3]

This socialisation has probably been a key ingredient to the success of the human race. Yet this can cause some problems in the modern day world. Brain scans have shown some interesting aspects of this. Looking into the brain with fMRI (functional Magnetic Resonance Imaging) we will see various parts of the brain light up.

Candidates during these studies, while lying in these scanners, were presented with various pictures of faces. When presented with frightened faces, the amygdala immediately lit up [4]. The amygdalae are key emotional processing units. But they are very active in processing fear, threat and anxiety. These emotions, incidentally, tend to take priority in the brain as they are survival functions. This makes sense in an evolutionary context. If I see someone who is afraid, there is likely a good reason and it would be good for me to be afraid as well. So far so good. Maybe not so surprising after all. Nevertheless this highlights how we operate in groups and are influenced by those around us. The more interesting aspect is that of unconscious fear.

[1] Easterbrook, M. A., Kisilevsky, B. S., Muir, D. W., & Laplante, D. P. (1999). Newborns discriminate schematic faces from scrambled faces. Canadian journal of experimental psychology Revue canadienne de psychologie experimentale, 53(3), 231-241.

[2] Hoehl, S., Palumbo, L., Heinisch, C., & Striano, T. (2008). Infants' attention is biased by emotional expressions and eye gaze direction. NeuroReport, 19(5), 579-582.

[3] Farroni, T., Menon, E., Rigato, S., & Johnson, M. H. (2007). The perception of facial expressions in newborns. The European journal of developmental psychology, 4(1), 2-13. Taylor & Francis.

[4] Whalen, P. J., Shin, L. M., McInerney, S. C., Fischer, H., Wright, C. I., & Rauch, S. L. (2001). A functional MRI study of human amygdala responses to facial expressions of fear versus anger. Emotion Washington Dc, 1(1), 70-83. US: American Psychological Association.

Part 2: Unconscious Processing

## Slide 4, frightening faces (2)

So now we come to the more interesting findings in the research. Unconscious fear. And this is activated through a technique known as masking. Simply subliminal activation. So in the previous example the study participants were in a scanner and looked at pictures of faces and the scanner picked up images of the brain activated in different ways. So far so good. Now we know that we consciously pick up a visual stimulus if we are exposed to it for more than 30 milliseconds. Below this and we do not consciously pick it up but it registers in the mind. Below 10 milliseconds and nothing registers. So if people see a fearful face we know they can consciously interpret it and feel fearful themselves. What now happens if this stimulus is below the visual conscious level? The technique of masking then shows images of, say, neutral faces for a few seconds and then as they change over a picture of a fearful face will be projected for normally 25 milliseconds. Will the brain now pick this up and also register fear? The answer is a clear yes [1].

This shows how the brain is hardwired to pick up and register fear. This means also that we may be picking up fearful signals without the foggiest that they are there. This is worrying for companies because if fear starts seeping through an organisation, this will cause all sorts of problems from mistrust to distorted decisions.

More than that an experiment [2] with cortically blind people shows just how deeply embedded this fear reaction is. Cortically blind people then went through the very same experiment of looking at various faces. These were blind people – cortical blindness is due to disfunctioning in the brain, the visual cortex at the back of the brain is failing to correctly process the information. The eyes are technically functional. And here fear was also registered in the brain when being shown fearful faces. This sounds surprising, and it is. Yet what it shows is that if a signal of a fearful face enters the brain the automatic fear detection centres pick it up even if the visual cortex is not functioning. This shows above anything else that we have an inbuilt fear and face sensitivity and our fear centres will activate according to the environment, our social environment.

An additional finding of this research [2] is that in the case of a patient who was cortically blind in only one eye, the fearful image that was presented in the blind field of vision activated the amygdala more. This suggests that unconscious stimulated fear is actually more powerful than conscious fear. A worrying take away for corporations and for all of us.

[1] Whalen, P. J., Rauch, S. L., Etcoff, N. L., McInerney, S. C., Lee, M. B., & Jenike, M. A. (1998). Masked presentations of emotional facial expressions modulate amygdala activity

[2] Morris, J. S., DeGelder, B., Weiskrantz, L., & Dolan, R. J. (2001). Differential extrageniculostriate and amygdala responses to presentation of emotional faces in a cortically blind field. Brain: A journal of neurology, 124(Pt 6), 1241-1252. Oxford Univ Press.
Part 2: Unconscious Processing

## Slide 5, mirror neurons

Mirror neurons can go some way to explaining our reaction to fear but more than anything mirror neurons demonstrate how we are connected to the world and, more importantly, to each other. Indeed many have named them the neurons that formed civilisation.

Mirror neurons in the brain were first discovered in a neuroscience lab in Parma, Italy, around Giacomo Rizzolatti's team of researchers. They had managed to wire up a single neuron in a macaque monkey and one day a researcher was in the lab and he ate nut. When he raised his hand to eat the nut (or snack or ice cream according to various accounts) he noticed that the monkey's brain cell had activated. The neuron that they had wired up was a motor neuron (dealing with movement). These are the largest neurons and so the easiest to connect (though that in itself is a challenge as neurons are pretty small things).

The initial reaction was to think that this was a mistake with the computer – the monkey after all was not moving. Further checking showed it was not the computer and after doing it a few times they believed they had stumbled on something new. An arm movement neuron that activates when it sees someone else's arm move. The paper written [1] after this was rejected initially for its general lack of interest, the journal's editors failing to see the wide implications of this. But it was a little later almost euphorically received by the scientific and broader community and there was a huge flux of research into mirror neurons. Many high profile researchers have dealt with this including V. S. Ramachandran and Iacoboni. The implications of mirror neurons are huge. We are connected with the people around us - with our mirror neurons that will be mirroring other's actions in our brains. In fact when we are having a mighty good conversation with a friend our brains shift into synchrony [2] \- firing in similar patterns. Being on the same wavelength is not imagined, it is real. It is biological.

What later research showed is that we can also mirror intentions [3] and it has been implicated strongly in how we process empathy [4]. What is sure is that we pick up how people are feeling and our minds can start to mirror it. Note that a mirror neuron will activate at a sub-threshold level. So when I watch a person move his arm I will not actually move my arm (however moving my arm may become easier).

More than that mirror neurons have also been classed by some as the neurons that formed civilisation [5]. Because of this mirroring effect they are strongly associated with learning [6] and empathy - strong traits in human beings and so seem key from an evolutionary standpoint [7].

This explains why if you watch a particularly bad speaker you may start to feel embarrassed for the person speaking. That feeling is a result of your mirror neurons hard at work. The same goes for confident speakers – they make us feel good. Their confidence is passed over to us. Again our mirror neurons hard at work.

This will also explain how a room can have an atmosphere. This is because the people around you will start to influence you as well – that is why you can feel the atmosphere. If a whole room is sitting there excited, your mirror neurons will likely fire away powerfully and quickly. So feelings are infectious and in any situation a group of people may be feeding their own emotions to others. This also illustrates, with brutal scientific reality, the relevance and absolute necessity of managers "walking the talk". If managers don't do it they will not activate the mirror neurons of their subordinates who will then unlikely also do it. This indeed is likely to be an unconscious process, as I keep emphasising.

[1] Rizzolatti, G., Fadiga, L., Gallese, V., & Fogassi, L. (1996). Premotor cortex and the recognition of motor actions. Brain Research, 3(2), 131-141.

[2] Dumas, G., Nadel, J., Soussignan, R., Martinerie, J., & Garnero, L. (2010). Inter-Brain Synchronization during Social Interaction. (J. Lauwereyns, Ed.)PLoS ONE, 5(8), e12166.

[3] Iacoboni, M., Molnar-Szakacs, I., Gallese, V., Buccino, G., Mazziotta, J. C., & Rizzolatti, G. (2005). Grasping the intentions of others with one's own mirror neuron system. PLoS Biology, 3(3), e79.

[4] Rizzolatti, G. (2008). Mirrors in the brain. How our Minds share Actions and Emotions. Oxford University Press.

[5] Ramachandran, V. S. (2000). Mirror neurons and imitation learning as the driving force behind «the great leap forward» in human evolution. New York.

[6] Del Giudice, M., Manera, V., & Keysers, C. (2009). Programmed to learn? The ontogeny of mirror neurons. Developmental Science, 12(2), 350-363. Wiley-Blackwell.

[7] Oberman, L. M., & Ramachandran, V. S. (2009). Reflections on the Mirror Neuron System: Their Evolutionary Functions Beyond Motor Representation. (J. A. Pineda, Ed.)Mirror Neuron Systems. Humana Press. doi:10.1007/978-1-59745-479-7
Part 2: Unconscious Processing

## Slide 6, justification & rationalisation

So we've just seen that there are various inputs that are being processed below our conscious level and now it becomes even more interesting. What happens when we try to explain this, when our conscious mind tries to explain our actions and reactions to unconscious stimuli? For this we can go back to a famous experiment carried out 80 years ago now that demonstrated how we start to post-rationalise much of the information going on around us.

Way back in 1931 the psychologist Norman R. F. Maier conducted an experiment [1] on rationalisation and justification.

The experiment was run in a room with ropes hanging from the ceiling – the task was to find methods to tie the ends of the two ropes together. The ropes were so far apart that it wasn't possible to just hold one end and walk to another end so the subjects being tested had to find solutions to this tricky task. People were asked to find ways to connect the two ropes together. One potential solution, for example, was to tie a rope to a chair in the room and this enabled positioning the rope close enough to the second rope to then walk over to the other rope and tie it to the rope on the chair. One solution that eluded almost all participants was the strategy of swinging a rope so that it could then be caught close enough to the other rope.

The participants stood in the room stumped for an answer – Norman Meier then walked across the room and "accidently" brushed against a rope setting it swinging (an intentional hint but so subtle that it wasn't clear that it was a hint). This stimulated most people to find the final solution – when asked how they had come to his solution, however, only one person (from 61) gave the real reason. Everyone else came up with an amazing amount of reasons for why they had found the solution ("It came to me in a flash of inspiration"; "The picture of a child on a swing burst into my mind." etc.) – because the hint was at an unconscious level the mind found a way of justifying it and came up for a reason – it was, in 60 from 61 cases, the wrong reason. This is not saying that the thoughts did not come into the minds but rather that the stimulus was unconscious and so the justification was at a different level.

There have been many more similar experiments (one experiment was held with biology students finding a solution to a problem [2]) showing how unconscious stimuli can influence us and how we are totally unaware of it but are very capable of coming up with a host of fantastic and very plausible reasons for why we came to what is now in our mind [3].

You can think of it like backward engineering. You see the solution and then calculate backwards to what you think is reasonable explanation for this – most of the time it will have nothing to do with the actual reason.

[1] Maier, N. R. F. (1931). Reasoning in humans. II. The solution of a problem and its appearance in consciousness. Journal of Comparative Psychology, 12(2), 181-194. Elsevier. doi:10.1037/h0071361

[2] Schunn, C. D., & Dunbar, K. (1996). Priming, analogy, and awareness in complex reasoning. Memory cognition, 24(3), 271-284.

[3] Nisbett, R. E., & Wilson, T. D. (1977). Telling more than we can know: Verbal reports on mental processes. (A. Devivo, A. Silver, D. Felder, R. Hayward, K. Patterson, A. Redman, A. Buchwald, et al., Eds.)Psychological Review, 84(3), 231-259. Psychology Pr. doi:10.1037/0033-295X.84.3.231
Part 2: Unconscious Processing

## Slide 7, confirming evidence

In 1998 a ground-breaking article appeared in The Harvard Business Review with the title: The Hidden Traps in Decision Making [1]. John Hammond with Ralph Keeney and Howard Raiffa had looked into the underlying psychological impact our mind has on our decision-making (and applied this to business for one of the first times). The article listed eight traps that business leaders (and we in general) fall into. One of them was called the Confirming Evidence Trap. It is common. Very common. In fact it is everywhere all the time.

Confirming evidence (psychologists talk about confirmation bias) is when you find the arguments to support your own arguments and standpoints and arguments and evidence that go against your opinion are ignored or moderated. In one psychological study [2] of this phenomenon, two groups - one opposed to and one supporting capital punishment - each read two reports of carefully conducted research on the effectiveness of the death penalty as a deterrent to crime. One report concluded that the death penalty was effective; the other concluded it was not. Despite being exposed to solid scientific information supporting counter arguments, the members of both groups became even more convinced of the validity of their own position after reading both reports. They automatically accepted the supporting information and dismissed the conflicting information.

If, as a business leader, you feel that cutting jobs is the answer to your problems as a company, you will find all the evidence you want that supports your argument and ignore all the evidence to the contrary. Keep your eyes open for this one - the world is full of it.

This is also a common trap of scientists trying to find the answers to their favourite theories. In everyday life we hear it daily from politicians. Politicians will always find evidence for their theories – indeed when we talk about big issues there is always evidence one way or the other and often we pick out one example (it may be the only example) and use this constantly. How many smokers do you know that refer to an uncle of theirs who smoked 100 cigarettes a day and was fighting fit and lived till he was 220.

Needless to say this is a common trap of politicians. Indeed Drew Westen's book "The Political brain" looks into the brain and politics and finds these immense distortions.

[1] Hammond, J. S., Keeney, R. L., & Raiffa, H. (2006). The hidden traps in decision making. Harvard Business Review, 84(1), 118.

[2] Lord, C. G., Ross, L., & Lepper, M. R. (1979). Biased assimilation and attitude polarization: The effects of prior theories on subsequently considered evidence. Journal of Personality and Social Psychology, 37(11), 2098-2109. doi: 10.1037/0022-3514.37.11.2098.

##  Part 3: Brains in Business

The previous section highlights some of the unconscious processes in the mind. But now we need to think about these in more specific business contexts and what this means for businesses and in organisations. Indeed what does it mean for your organisation?
Part 3: Brains in Business

## Slide 1, fear in the brain (1)

I've previously mentioned fear and how it can activate unconsciously. I also noted that fear is one of our prime emotions – it is the survival instinct. So when looking into business we need to look long and hard at fear. Business creates many situations that can generate fear in and across an organisation from the highest echelons to the lowliest of workers. Fear can ride across economies and drive them into deep recessions. Fear is easy to underestimate and simply to dismiss. Don't. It is something anyone in business needs to take very, very seriously. Fear in organisations and in leaders will distort thinking patterns, creating a cascade of decisions and bad actions and freeze people and ideas. Fear will seep in unnoticed, many may not be aware it is there, but seep through the organisation it will. Indeed.

First let's look at the impacts of fear and then let's think about how this can enter into organisations.

Fear activates the amygdala [1] (amygdalae in the plural but here I will only talk in the singular) – there has been plenty about the amygdala in literature and this has almost reached the general laymen. As such it may be misused. However, the power of the amygdala should not be underestimated. They are two almond-shaped structures sitting deep in the limbic system in the brain. They are very strongly linked to processing emotion. Fear as a primary survival function simply takes priority. This means fear will override all other emotions. Not good – or correction – good if you want to survive being eaten by a wild animal. Bad if you want to run a successful business.

This activation in turn will lead to a cascade of hormonal reactions and physical responses such as increased heartbeat, increased adrenaline and focusing of vision. Specific impacts on the brain's cognitive processes I will explain later, but suffice to say that fear will also stimulate, if the adrenaline is not used, the production of cortisol – the stress hormone and hence push your employees towards sickness in some cases and for many his may be the start of the slow drop into burnout.

And now we can take a short sidestep into the world of behavioural science and look at mice and dogs. Many of you who haven't followed these experiments in any scientific detail may wonder what on earth the behaviour of simpler creatures such as mice, rats and dogs have to do with human behaviour. We are after all pretty distinctly different. Yes, we are, but there are some striking similarities in brain structures and primitive emotions and reactions.

[1] Davis, M. (1992). The role of the amygdala in fear and anxiety. Annual Review of Neuroscience, 15(1), 353-375. Annual Reviews. doi:10.1146/annurev.ne.15.030192.002033
Part 3: Brains in Business

## Slide 2, of mice and men

So first let's look at mice. Put a mouse into an open box and how does it respond? It will walk around the sides exploring. It will not venture too far out into the open. This is danger. It will stick close to the walls for safety. Similar to what us humans would do. Explore but don't stick your neck out too far – this is also how we would react in a new company. Now what happens if you create fear in the mouse i.e. through an electrical shock? The mouse will then move to a corner where it feels safest – two walls. It will then cower in that corner and not move any further even when the fear has been removed. So give fear and you sensitize fear. Remember the section on sensitizing neurons - the mouse will not move away from its corner. And then this leads to conditioned fear [1] linking a neutral signal with a fear impulse.

Does this sound familiar in organisations? Indeed organisations may be unwittingly sensitizing and conditioning their employees to fear. This will be reflected in employees unwilling to move away from their "little corners" in business and fighting to defend their little patch. That is likely fear at play.

Now it becomes more interesting with Seligman's yoked dogs because there comes the phrase of, as Seligman called it, "learned helplessness" [2]. Which seems a contradiction. In Seligman's now famous experiment back in the days of the behaviourism (Skinner and Pavlov and co). Seligman put dogs in a box for a series of experiments. At first these boxes were wired on the floor to give a small electrical shock. Obviously if the dogs received the electrical shock they would jump to another part of the box. Some of these boxes were rigged with an escape route. So far so good but what would happen if the dog had no escape route. The dogs would initially walk around desperately trying to find a place away from electric shocks and looking for a means of escape. But then it changed. They would then just submit and sit or lie down and accept the discomfort. Just sitting there taking the pain [3] [4]. Any analogies to business jump to mind or even home life? Just sit down keep your head down and accept what comes over you. Now when these dogs had become lethargic and submitted to the pain an escape route was then opened. We might assume that the dogs would then jump, literally, at the chance to escape. They did not. Most of the dogs simply continued sitting there. They, even with an escape route now open, had become helpless - they had learned to become helpless.

Though I may sound sceptical I am not being so. It is just a simple fact of life that many corporations do not give the freedom of movement and ideas to explore without fear. Many organisations have too much fear to allow employees to really grow out of themselves.

When recently listening to Sergio Marrchionne, CEO of Fiat Group, at a talk he noted a very poignant point when speaking about the successful turn around of Fiat. He spoke about the great work of the advertising team in a crucial situation, which they had mastered ingeniously and extremely successfully at a fraction of the cost of most of their competitors. Sergio said that this was the result of a team being able to operate without fear. I repeat being able to operate without fear. Important – no not important, it is absolutely essential. Absolutely.

But what does fear do exactly in the brain? Let's look at that now.

[1] Davis, M. (1992). The role of the amygdala in conditioned fear. In J. P. Aggleton (Ed.), The amygdala Neurobiological aspects of emotion memory and mental dysfunction (Vol. 1, pp. 255-306). Wiley-Liss.

[2] Hiroto, D. S., & Seligman, M. (1975). Generality of learned helplessness in man. Journal of Personality and Social Psychology, 31(2), 311-327. Elsevier. doi:10.1037/h0076270

[3] Seligman, M. E., & Maier, S. F. (1967). Failure to escape traumatic shock. Journal of Experimental Psychology, 74(1), 1-9. American Psychological Association.

[4] Overmier, J. B., & Seligman, M. E. (1967). Effects of inescapable shock upon subsequent escape and avoidance responding. Journal of comparative and physiological psychology, 63(1), 28-33.
Part 3: Brains in Business

## Slide 3, fear in the brain (2)

I mentioned previously that the amygdala is our main fear-processing unit. I did warn of oversimplifying previously and note here that the whole brain works in unison. The visual cortex will indentify a signal. This may be compared to previous memories using the hippocampus, the thalamus sends the visual signals to the relevant part in the outer cortex and the amygdala will fire up and almost instantaneously the brain stem will activate the heart beat and the hypothalamus will start to release norepinephrine and so the process continues. You get the idea I think. So with a risk of over-simplification, and for our goals, it is important to know some of the specific effects on our brain processes.

As I have said previously fear takes priority and fear is a survival function so it has dramatic impacts on the brain. One of the first effects is the impact on our prefrontal cortex, the lobes at the front of our brain. These lobes are responsible for a lot of our "rational" thinking, much planning, balancing information, and even short-term memory are all positioned here, also our ability to control aggression.

So as the amygdala is our emotional processing unit, amygdala activation will lead to increased emotionality. As we sit there in the face of fear we will not remain calm but emotions in all directions will running high [1].

The next big impact of fear is decreased rationality. When you are afraid you will not start making long rational calculations. Algebra dies in the face of fear! The amygdala has a direct link to the prefrontal cortex as mentioned our rationalising centres and decision-making centres [2] also. When the amygdala activates this will inhibit prefrontal functioning [3]. In businesses this means that balanced decisions become more difficult and that an organisation's (leader's or team's) cognitive processes are inhibited and restricted. Less intelligence and less creativity that is. It will also lead to a decreased ability to deal with complex information and decreased short-term memory (which is critical for decision making).

The next big impact is on the motor cortex [4]. The brain stem will start taking over primitive functions and this fast decision route will tend to make one of two decisions. Fight or flight both requiring high energy. A third reaction is that of "freezing" the classic rabbit in the headlamps of the oncoming car. So fear can also block all action. This means that if the fight mode is activated, we will have aggressiveness and defensiveness and high energy. This in business will translate into aggressive defensive attitudes and a lot of nervous energy. Much of this energy will be invested into defending or fighting for one's own position and not for the good of the company. The flight reaction will also release high energy but into fleeing - translating into avoiding the problem. Dodging the issues so to speak. High energy unused can also translate into nervous action in corporations but without taking the bull by the horns. And thirdly the freeze reaction (noting also that in the first two primitive reactions cognitive processes are inhibited anyhow), which will translate into not getting anything done and listlessness in the office. All three are poison for corporations.

Negative bias. The part of the brain that is influenced is something called the ACC, which is the Anterior Cingulate Cortex, also sitting in the middle of the brain. This is an attention centre and controls your attention and filters information coming in. This is now over-sensitized because of the fear reaction and will be tainted negatively. This means that situations which were previously considered unthreatening or neutral suddenly become threatening (and further increase the fear reaction). We will be looking at the world through spectacles that have been coloured with fear. A sheen of threat will lie of everything [5].

So in summary we have increased emotionality, decreased rationality, over activity focused on fighting or avoiding problems, or inactivity and to top it all negativity. On top of this, to paint a bleak picture, we have unconscious fear as I showed previously and this may sit in organisations which do not even realise it. As I also showed fear can simply be activated through facial expression. Indeed it can but mirror neurons also show just how infectious an emotion can be. Let's take a look at mirror neurons.

[1] Gallagher, M., & Chiba, A. A. (1996). The amygdala and emotion. Current Opinion in Neurobiology, 6(2), 221-227. Elsevier.

[2] Dolan, R. J. (2007). The human amygdala and orbital prefrontal cortex in behavioural regulation. Philosophical Transactions of the Royal Society of London Series B Biological Sciences, 362(1481), 787-799.

[3] Garcia, R., Vouimba, R. M., Baudry, M., & Thompson, R. F. (1999). The amygdala modulates prefrontal cortex activity relative to conditioned fear. Nature, 402(6759), 294-296. Nature Publishing Group.

[4] Rezek, M., Havlicek, V., Hughes, K. R., & Friesen, H. (1977). Behavioural and motor excitation and inhibition induced by the administration of small and large doses of somatostatin into the amygdala. Neuropharmacology, 16(3), 157-162.

[5] Sharot, T., Riccardi, A. M., Raio, C. M., & Phelps, E. A. (2007). Neural mechanisms mediating optimism bias. Nature, 450(7166), 1-5. doi:10.1038/nature06280
Part 3: Brains in Business

## Slide 4, mirror neurons

A few pages previously you saw the same title and the same picture. Mirror neurons those neurons that activate when you see somebody else doing an action. We have been speaking about fear and how powerful fear is in the mind and how it can immediately distort thinking patterns, We also noted in the scientific experiments that fear can be activated without you knowing about it. When we have fear therefore in an organisation this will almost certainly activate the mirror neurons of the people in the organisation and spread like wild fire – well not like wild fire because the fear will spread below the level of consciousness. The mirror neurons will be hard at work. The amygdale will activate below our conscious level, our heartbeat will slightly increase, our rationality will slowly be inhibited, our view of the world will imperceptibly but in reality be tinted negatively and the cycle will continue. Creativity will drop, decisions will be postponed, ideas will be thrown out, risk will be seen everywhere. This will be happening without you, the leaders, and without the consciousness of the organisation knowing it. The organisation will be suffocating in fear without the slightest clue as to what is happening.
Part 3: Brains in Business

## Slide 5, what can stimulate fear

Fear can be stimulated by fearful faces we've already seen that. The big question to ask ourselves here is what else will stimulate fear? If I know what could stimulate fear I will be able to counteract it. Some are obvious:

Fearful faces

Threatening faces

Threatening situations

Some make sense with a bit of thought:

Fear of losing job

Recessions

Fear of terrorist attacks

Fear of retribution

Fear of losing face

Some you can work out but maybe don't jump out at you:

Uncertainty

Ambiguity

Not knowing

All of these you will find in companies - more importantly as soon as a recession kicks in all the above will kick in rapidly and powerfully. I watched during the recession as companies went into fear mode. This simply means rationality dropped, quality of decisions dropped, communication dropped, creativity dropped, energy dropped. Dramatic. But companies didn't know what to do about it apart from cutting costs. What a shame!
Part 3: Brains in Business

## Slide 6, the closed door

Look at the picture above and does this make you feel happy? Sad? Anxious? Unsure? You don't know? Probably one of the more negative emotions. This is because we don't actually know what is behind the door. Remember what I just said about fear activation. Uncertainty activates fear in the brain.

This is a common misconception of change. We presume people don't want to change. That is not true. Let's assume I want to give you a new car, actually the car of your dreams. So you can have the car of your dream tomorrow, or house or whatever else. How do you feel? Happy? Sad? Worried? Assuming it is actually true you will be feeling excited no doubt. It is a good feeling. And getting the house or car of your dreams is change, dramatic change but it is perceived as positive. The problem is not change - we like change. Most of us like meeting new people and doing new things and getting new items. This is all change. The problem with change is the uncertainty the unknowing. This activates fear and will cause all the symptoms we have spoken about, higher emotions, lower rationality, and increased negativity. The problem is not change. Sure we have habits and habits may be hard to kick and this itself can be a strain on the brain but one of the underestimated aspects of change is not change itself but the uncertainty it causes which causes disruption in the brain.
Part 3: Brains in Business

## Slide 7, trust

Trust we all know is an essential area for business. We all talk about trusting and indeed the perception of being trusted even seems to improve business results according to a report in 2010 [1]. And when we look at the biology of trust this will not surprise us.

However, the subject of trust is interesting – we all know it is essential for business, indeed it is. More important than many people imagine. We only buy if we trust that you can provide the services you promise. We only buy from websites that we trust – this may not be the same as trusting a partner but nevertheless there is some form of trust in every transaction that we do.

What is more worrying is that the level of trust in corporations seems to be shockingly low. The Harvard Business review reported in 2006 that 80% of Americans don't trust corporate executives and that, astonishingly, 50% of managers don't trust their own leaders.

So what happens in the brain with trust? Well trust activates the reward centres [2]; this is good (I will speak more about reward in a few pages). Trust is after all a social instinct and so it will reward you and release the bonding chemical oxytocin which has been implicated in many forms of bonding – some rather unflatteringly call it the "cuddle chemical".

Trust can be formed in many ways but, interestingly, one of the main ways is in faces [3]. Yes that simple – the way you look will affect whether you are trusted or not. Think to films where it is quite easy to identify the goodies and baddies by their facial expressions (and posture alike). The other important builders of trust are alignment of interests [4] and reciprocity [5].

Another side of trust is that in the brain conditional and unconditional trust are processed in a similar way, they both activate different parts of the reward centre but they are also different. The moral here is not to go for unconditional trust. That is indeed a lofty goal. Go for conditional trust i.e. within a certain context.

[1] Salamon, S. D., & Robinson, S. L. (2008). Trust that binds: the impact of collective felt trust on organizational performance. Journal of Applied Psychology, 93(3), 593-601. AMER PSYCHOLOGICAL ASSOC.

[2] Krueger, F., McCabe, K., Moll, J., Kriegeskorte, N., Zahn, R., Strenziok, M., Heinecke, A., et al. (2007). Neural correlates of trust. Proceedings of the National Academy of Sciences of the United States of America, 104(50), 20084-9. National Acad Sciences. doi:10.1073/pnas.0710103104

[3] Said, C. P., Baron, S. G., & Todorov, A. (2009). Nonlinear amygdala response to face trustworthiness: contributions of high and low spatial frequency information. Journal of Cognitive Neuroscience, 21(3), 519-528.

[4] Boudreau, C., McCubbins, M. D., & Coulson, S. (2009). Knowing when to trust others: An ERP study of decision making after receiving information from unknown people. Social cognitive and affective neuroscience, 4(1), 23-34. Oxford University Press.

[5] Van Den Bos, W., Van Dijk, E., Westenberg, M., Rombouts, S. A. R. B., & Crone, E. A. (2009). What motivates repayment? Neural correlates of reciprocity in the Trust Game. Social cognitive and affective neuroscience, 4(3), 294-304. Oxford University Press.
Part 3: Brains in Business

## Slide 8, the dark alley

Look at the picture above and tell me if you would feel comfortable standing there as the two men approach. If I told you the two men are walking away from you, you may feel slightly differently. But this picture represents what is happening in the brain with trust measurement. The good old "friend or foe" concept. With trust we are first checking internally whether a person is a friend or enemy whether we can trust them and bond with them or whether they will pillage my village and rape the women. That's it.

What this simply means is that the brain is making quite a simple two-way decision trust = good = reward = bonding (and in corporations also = motivation & loyalty).

Mistrust is a threat: you are a (potential) foe. Threat activates, wait for it, yes the good old amygdala our emotional processing units that process fear so powerfully. Threat is a survival function and will generate the same sort of patterns in the brain as fear. Threat will make you decide more emotionally (that is negatively against the person you don't trust). It will inhibit your prefrontal cortex meaning rationalising will be lower. It will put you on alert (and increase your stress in corporate environments). All in all very bad for corporations.

So now go back to the figures I quoted previously 50% of managers do not trust their own senior leadership. This is shocking because it means that 50% of managers in the corporation are working with suboptimal brains and increased stress, less motivation and less loyalty. Yet corporations always want motivated people who are loyal but there is a contradiction because if there is no trust, there is no loyalty. We would expect managers to be more loyal than their subordinates. And then remember our mirror neurons. If the managers don't trust their leaders, what are the chances that the mass of employees will?
Part 3: Brains in Business

## Slide 9, reward

From trust which activates our reward centre we can then move directly on to reward in general [1]. Reward in the brain is like Christmas – it is good and indeed it is what keeps us going in no small way. It keeps us going because reward is linked very strongly to motivation and having a will or desire to do something.

In the brain reward is processed in a collection of structures known as the Basal Ganglia sitting deep inside the brain as just about all emotions do, in the limbic system. When these activate you are simply giving your brain a biological present. Indeed presents activate exactly this area. Your brain will bathe itself in good-feeling chemicals. That is why it is a good feeling to trust someone and a bad felling if you mistrust someone. Having a close friendship is rewarding as is watching your favourite sports team win. So is listening to your favourite music and having a party and eating and drinking. The list could be endless. And indeed much of this is pretty obvious given a moment's thought. The only reframe that we need to make is we need to think of reward from the standpoint of a brain and not a person. Think: is this person's reward centre being activated? Some things seem to be pretty universal but others may be individual depending on the associations and connections the brain has built up for itself.

In a very simplified version of the reward system these stimuli activate the Ventral Tegmental Area which in turn releases dopamine [2]. Dopamine feels good in high doses but is also essential in attracting your attention and keeping your focus on something. If you are still reading this I have in some way been able to activate your VTA and release certain amounts of dopamine to your prefrontal cortex which is keeping your attention focused on what I have written. If I am doing a good job, you will be involved and feel somewhat rewarded after reading it. You may even be enthusiastic - which would make me happy (i.e. activate my reward centre and encourage me to write more along the way). So a quick thought needs to be given to corporations – how many are dopamine friendly places? How many employees walk out of work with dopamine-bathed brains? I already sense many sceptical smiles – too few, I fear.

In corporations there is little thought given to the brain's reward system – for the clients maybe but not for the employees. Many corporations stick with the simple concept of pay is your reward. Yet back to our section on habituation the brain's 100 billion neurons will become habituated pretty quickly to the same pay packet coming in. This also explains biologically why pay rises and bonus packages are short lived. There is reward in the brain but this is a temporary biological process for it to stick deeper we need to be getting reward daily out of the corporation. This will outweigh any pay rise or bonus pack.

So what activates the reward centre? Well the list could be endless and many will be personalised. However we have a pretty good idea of what rewards are in general. Technically we may speak about primary rewards, which are food drink, and sex - simply put those that are important for the survival of the species. We then have secondary rewards which include money. But looking at the list of what can reward us we see that it is large and many of these are cheap.

Money

Leisure

Information

Entertainment

Status

Altruism

To this I will add social rewards from the brain's perspective social reward, such as trust, also activate the brain's reward centres. Interestingly social reward will include the following:

Trust

Feeling of belonging

Respect

Value within community

Interaction (for extroverts this may be more so, for some introverts not so)

Compliments

Gratitude

And what counteracts reward. Well the usual. Punishment but also fear will inhibit any sort of reward. Give a huge pay rise during a recession and you may have next to no reward centre activation if the prospects of losing your job are high. Corporate systems that punish will counteract reward. Systems which only have a few winners will counteract reward (and demotivate the majority) as will ranking systems that only reward a few. Competiveness between employees is good to a certain extent but has many negative side effects from the perspective of the brain. Indeed research into the feeling of belonging at work noted just these as non-belonging dimensions: fear, rejection and competition [3].

Remember also that many of the simplest factors in life are the most rewarding and companies would do well to heed this. Regular feedback and compliments are best. Feeling a part of the community also. This you will notice correlates strongly to most important factors in job satisfaction for employees. The following always rank highly:

Sense of belonging

Rewarding work

Appreciation

Recognition

Relationship with boss

Job security

These can all be explained in terms of the brain's reward system and what we know rewards the brain.

Though much of this is common knowledge in Human Resources there is still a major corporate issue and challenge with being able to tie these into daily work, rankings and compensation systems for major multinationals.

[1] Kringelbach, M. L., & Berridge, K. C. (2010). The functional neuroanatomy of pleasure and happiness. Discovery Medicine, 9(49), 579-587.

[2] Bozarth, M. A. (1991). The mesolimbic dopmaine system as a model reward system. In P. Willner & J. Scheel-Kruger (Eds.), The mesolimbic dopamine system From motivation to action (pp. 303-330). John Wiley and Sons, Ltd.

[3] McClure, J. P., & Brown, J. M. (2008). Belonging at work. Human Resource Development International, 11(1), 3-17. Taylor & Francis.
Part 3: Brains in Business

## Slide 10, spheres of impact

When we think of what I have written over the previous pages we need to start to think about how we can clearly use this in organisations.

All of the information I have given we will need to think about in four separate and interlinked contexts. Some may be more relevant for you and some may be out of your control but you will always have some influence on one of the contexts.

Individual leaders or person:

When speaking of individuals we need to think firstly about ourselves. Are our opinions being tainted by fear? Is my personal indecision fear, uncertainty or simply that the decision is difficult to make? Am I unbalancing information with confirmation bias and am I being influenced by the environment? These are all questions we need to ask.

What is the solution you may well ask?

There is no one solution but there are many solutions. But the most important is to keep an open mind and increase your awareness. Awareness is the first step to learning and improving skills. This analogy, stupid as it sounds, highlights this: if I play tennis and don't notice I don't hit the ball I am unlikely to learn to hit the ball. It sounds stupid because in tennis hitting the ball is so obvious – or rather we cannot but be aware of it. However with cognitive processes it is not so clear as hitting a tennis ball and that is why we need to shift our awareness. This is also the goal of coaching. Some may see coaching as a remedial intervention. It is not. One of the most powerful processes in a coaching process is about increasing your personal awareness and being able to question and think about your internal processes. This is the power of coaching because this awareness can shift you subtly to new and more exciting places.

Teams

When we come to teams there are similar issues. Situations such as fear, I mentioned, will become very powerful and need to be carefully controlled in teams. Motivation will need to be looked into and reward – these are tied directly in to our reward centre activation and thinking of precisely how the brain processes this gives a concrete clarity and understanding to target the underlying causes.

Organisations

All these issues will need to be thought about carefully because, as we saw with mirror neurons, these can take on strong dynamics themselves and become hard to control. Careful thought will need to be given in difficult situations to keep the amygdala calm and hence to keep the cognitive power of a company intact. This will also include greater creativity and increased meaningful action. It will stop bickering and in fighting but only if you understand the brain dynamics that are happening in the company. Understand also that each person's brain is not identical so different strategies will need to be applied for different types of people.

Economics and the whole economic environment will also impact us strongly. During the recent recession we saw an increase in all sorts of irrational and emotional action by organisations, individuals and governments. These are also signs that the brain is imbalanced and not functioning smoothly and effectively. Recessions will generate fear which will affect the brains of the people in your business. It may influence the stress, the quality of work, sickness rates and the more severe cases of burnout. These can all be triggered by the economic environment.

You may still be asking how can I do this or what can I do in a recession period (or boom periods which will also have brain distortions). Well we need to be thinking in terms of interventions for corporations and strategies which tie into human brain functioning. For a host of situations we can define various interventions and strategies that will boost the brain functioning. Indeed many companies will implement these but will not address the deeper root. An example is, as implemented by a major insurance company in Switzerland, is of the GE Workout concept. This is a great concept and involves those who are doing the work, the frontline so to speak, to come up with specific initiatives that can be solved in a short period of time. Senior management will then be required to make a decision "on the spot".

This is an excellent concept because it does many positive things in the brain – action will lower amygdala activation. Being involved in a decision making process is also rewarding which will lower fear activation. It also shows respect and value to the people involved in the process which also increase reward centre activation. So all in, without doubt, a great process to increase action, solve problems and lower fear.

Yet despite its value, it is only partly addressing the problem and should be part of broader strategy. We need, in the above case, a whole corporate Amygdala Intervention Strategy which will include the Workout sessions as part of this. We need something that will take fear out of the system and thus enable everyone to be working to their maximum with well-balanced and cognitively powerful brains. I will now give an example of a broad corporate intervention strategy. A process that should kick in in times of crises or fear. This can, and should also include concepts such as Workout. Many of the interventions are incidentally cheap. They do not require complex tools or processes. They requite intuition, feeling and common sense in the most but need to be implemented consistently and proactively to target the reward centres of the brain and help lower fear activation. This will give the company a massive boost in cognitive processing, action, motivation and following on from this success.
Part 3: Brains in Business

## Slide 11, CLEARVision

CLEARVision (© Andy Habermacher, 2010) is a holistic corporate strategy that needs to be implemented across the organisation and in departments, teams and in individual leadership in times of fear activation. This is but a model but gives clarity as to how simple tools can be implemented at various points in an organisation to lower fear activation and increase, motivation and creative and powerful action. If consulting a major corporation, there are various aspects that will need to be focused on more and various ways of implementing these depending on the context. There are also a host of other strategies such as the Workout sessions that can be implemented. For our purposes and to highlight the power of the model I will stick to this simple intervention model here.

Let's look at each item before we look into specific ways of implementing it – and the good thing about this type of intervention is that most of it is free.

C

Communication. When the amygdale become active it will search for information that could increase the threat. The negative bias I mentioned. To counteract this and to counteract the unknown which will further increase the negative spiral we need to have communication i.e. information. Even concrete negative information is better than not knowing. If the information is concrete and known, it is better for the mind. This means it is better knowing I won't have a job next week than not knowing whether I will or won't. This may sound illogical but think about it. If I know I won't have a job, I can prepare for it, I can make plans, I can start looking. I can develop a strategy. Yes I may be angry, I may be disappointed but I have clarity and I know what I can do about it. Not knowing is a black hole that will create a vicious circle in the brain. I also noted when talking about reward that information can also be processed as a reward.

Clarity is essential and by this we can also mean simplicity. Remember when the amygdala activates it will disrupt the prefrontal functioning ("rational" centres) meaning less rationalisation this will also mean less short-term memory and a decreased ability to deal with complex information. During crises situations we tend to be overloaded with complex information helping stimulate the negative cycle. Communication at this stage (indeed in general) needs to be crystal clear. This will avoid disruption and therefore help calm the amygdala.

Choice can be very powerful in human beings. Think of the psychological difference of flying and of driving a car. We somehow feel safer in a car because we (erroneously) feel that we have more control. We feel we are in control of our destiny so to speak. This highlights the power of personal influence on feeling safe and hence moderating our amygdala activity. Allowing employees choice is a very powerful way to deal with crises situations. This could be take a pay cut or alternatively cut jobs. This could be 10% of jobs need to be cut and first volunteers can take the option, etc. These can all be very powerful. They also show a respect for the opinion of employees. And remember that reward centres are activated by social contexts i.e. appreciation and respect for an individual will moderate amygdala activation and increase reward centre activation. When we feel as if we are an ant in a machine that can be crushed at any moment we miss all social rewards and our amygdala will be running on overdrive.

But all that said, beware of choice also - too much choice can also cause insecurity (as Barry Schwartz notes in his book The Paradox of Choice). Choice should be used to give personal control. In a recent paper Catherine Ross of the University of Texas notes that powerlessness and mistrust are distressing, increasing levels of anxiety, anger, and depression [1].

L

Listen. If you listen to your employees you will lower their amygdala activation. Simple. In research it has been shown that merely expressing an emotion moderates that emotion [2]. So if you are angry by saying you are angry you actually moderate it. Allowing yourself to "get it off your chest" will also moderate emotions. So allowing employees or even clients an opportunity to get it off their chest will moderate their emotions. It will also potentially activate their social reward centres, as this is a social function. Back to communication. Being listened to is powerful for all of us. "No one listens to me." suggests low status and this will increase stress, decrease self-esteem and potentially increase amygdala activation.

Letting it out as I mentioned above is essential and will moderate emotions. Management should not be afraid of letting their employees really let it out. In a safe environment with no consequences. If the employees really think that the senior management is a bunch of idiots they should be allowed to say it (counter intuitively this will actually make sure that the employees do not believe senior management is a bunch of idiots).

Limit. When I speak of limit I mean limit the time frame or the consequences. When we are in amygdala overdrive our view is restricted and we cannot see the end of the tunnel. This in itself will feed the amygdala even more and create a vicious circle. So in crises situations we need to keep the perspective and limit as much as we can. For example I can tell the employees that we will be going through a tough period but that we have been through tough periods before and that this will be over as has always been the case in 6 months or 1 year or 2 years. The limited time horizon creates clarity and perspective and understanding all with the power to moderate the activity of the amygdala.

E

Emotions. We noted that amygdala activation comes hand in hand with high emotions. We have less emotional control and our rational centres have shut down. At the same time emotions are what connect us. We want to have emotions and understanding and sympathy. Showing emotions creates a human face to a leader and creates understanding. As Beatrice Tchanz, PR for Swissair, announced the crash off Halifax when an airbus crashed leaving all dead, the emotions were clear to see in her face. We felt with her, with the organisation and with the victims. We were in an emotional state but importantly we were in an aligned emotional state. Remember that aligning interests increases trust. Swissair and Beatrice Tchanz were later complimented for their handling of the case most of which, I believe, can be put down to the emotional handling which created unity in the public and families of victims.

Imagine if she had said, cold and stony faced, that this is no fault of Swissair. Precisely this reaction happened in Germany in Duisburg in 2010 after a mass panic when 30 people were crushed to death at a techno parade. The Lord Mayor, Adolf Sauerland and the organizer sat their stony faced and emotionless and denying any sort of responsibility. This caused rage and uproar in the general public. A few emotional words, some clear shock, sadness and horror would have brought all the people alongside him.

Many leaders are afraid to express emotions and seem to think that this will weaken them. On the contrary this will strengthen them. Remember the brain operates emotionally. Emotional connections are the most powerful. Loyalty is driven by emotion and emotion alone. Emotions will increase your strength. As I recently watched Adolf Ogi the ex Swiss Minister and representative to the UN speaking about the death of his son which had, deeply, deeply hurt him. My heart went to him and my respect increased as I saw behind this politician a man like myself with a deep love of his family and I could feel his pain at having lost an adult son and living to see him buried. My emotions were aligned with Adolf Ogi and so my connection to him increased. As yours probably have after reading the couple of sentences above – showing that a couple of sentences can increase emotional alignment.

Empathy is also a powerful tool and ties in to emotions we have just spoken about though we also need to have a healthy respect for empathy because it can also distort our opinions. In an experiment conducted in 1999 under the title of "Can 40 seconds of compassion reduce patient anxiety" [3] researchers found that in clinical settings with patients indeed 40 seconds of videotaped compassion was enough to reduce patient's anxiety. That is a powerful lesson for leaders – 40 seconds of compassion, empathy or emotion is enough to reduce your workforce's anxiety!

Enemies

We may seem to think that this is a bad strategy but it is not. We noted previously that aligning interests increases trust in the section on trust. There is no better way to increase trust than by creating or highlighting a common enemy or a common threat that we can fight together to overcome. Very powerful. It gives direction. Puts us in the same boat. So often in crises periods the enemy is from within and companies start to sabotage themselves. In politics this is used very powerfully and we saw after 9/11 in the USA the massive increase in US identity and bonding within the USA. The whole nation had been attacked and had a unified enemy and the government did everything possible to make clear how unified that enemy was and how dangerous it was and that is must be fought to the end. Combining emotional contexts and unifying concepts (no discussion here on political standpoints and whether this was right or partly politically motivated - suffice to say that the bonding in the USA was immense).

Freud also noted that the demand for his services dropped massively as the Second World War broke out. Not because people were fighting but because the unity and direction it gave the people gave them a sense of purpose and a sense of worth. Psychological problems can also evaporate in the face of a clear enemy. Enemies can be many things, we may immediately think of people and companies or countries but an enemy can also, for example, be inefficiency, it can be costs, it can be lack of commitment. It can be many things. But the enemy has to be clearly defined and understood by the organisation. What damage the enemy can do must also be clearly understood. And here we are back to communication. It must be consistently communicated. It must be clear and it must be emotional.

A

Aligning interests is the single most powerful way to increase bonding, trust and motivation. And conversely if your interests are not aligned you will generate mistrust and a subsequent decrease in motivation and loyalty, energy and commitment. If managers think the interests of leadership are not aligned with their own – there will be mistrust. As we noted previously only 50% of managers, according to that article, trust their own leaders. If employees feel senior management does not have aligned interests with themselves trust, loyalty and motivation will plummet.

Action we know can be compromised by an active amygdale. It will cause the motor cortex to over-activate ready for flight or fight. Or it will deactivate. The rabbit frozen in the headlights of the oncoming car. Yet action itself will also help to deactivate the amygdala. It will give direction helping to give purpose and take away the fear of uncertainty. If you know what to do you will have a less active amygdala. But again we are back to our "C" we need clarification and preferably concrete action. As our house collapses in an earthquake we feel despair and fear and uncertainty. If I know that I have to dig to rescue a survivor that I know is there, I have strong purpose and can motivate a huge amount of energy. If a have rubble field in front of me and don't know where to dig and where the survivors are I will likely be blocked. So clarity of action, a clear action plan with action defined will help give purpose and direction and help moderate amygdala activity. The GE Workout concept here spans a couple of categories but could be put into this category also because it has a clear focus on action.

Appreciation (gratitude) is something that drives motivation and self-esteem. Research into appreciation shows increased loyalty amongst customers [4]. Gratitude is strongly linked to happiness [5] and a longitudinal study in 2007 supported the importance of gratitude for well-being and supported the need for interventions [6]. And so it is in crises situations that leadership teams fail to show appreciation or similarly appreciation for years of loyalty suddenly evaporate. This in turn leading to resent, to lack of loyalty, to uncertainty, to frustration and a host of other negative emotions that can sweep through an organisation quicker than wild fire and cause a turbo charge to the corporate amygdala. This will quickly turn into a vicious circle. In times of crises we need to show greater appreciation for employees than in boom times – the opposite normally happens.

R

Rituals create a sense of security and that is why they are so powerful [7]. Creating rituals creates a rhythm, a process that is secure. It takes away uncertainty. So what sort of rituals can we be implementing in corporations? Well, the good old team meeting is a ritual. These need to be increased during times of crises or of high amygdala activation. These can be, for example, Monday morning meetings with coffee and bread rolls. It doesn't have to be long but allows a ritualised way of sharing communication around a crisis. It could also be a weekly or daily email, at the same time. It could be a teleconference, it could be handing in short projects, it could be giving awards (see reward below).

Rewards we noted previously are basically the opposite of amygdala, that is fear, activation. These bathe the brain in positive chemicals and often keep motivation and loyalty high. Yet in times of crises the concepts of rewards flies out the window without anybody in senior management noticing. There may be retention packages sealed but these are not rewards. So no rewards = no motivation. Simplified as this is, it holds true a lot of the time - with the perennial danger of over simplification. Dopamine one of the primary reward signalling molecules in the brain is strongly associated with reward, motivation and "wanting" [8] [9].

So cut rewards and you cut motivation and increase potential of amygdala activation and the distorted thinking patterns this gives not to mention the infectious quality of fear. Many may well counter: well how can I give rewards in times of crises? Well remember what the brain processes as rewards. Appreciation for a start and we are back to A above. Constantly and consistently show appreciation for your employees. Food and drink – simple but that ritualised meeting with a glass of hot chocolate may be surprisingly rewarding as it is doing a few things: communicating, creating clarity, rituals and food and drink stimulate the reward centre. Small spontaneous presents. Which could be a simple as a bar of chocolate for a goal achieved. The token is more powerful than the reward – all will appreciate if they know there are financial constraints that there cannot be big rewards. Even more powerful if a leader forks out for it from their own pocket. Yes, I did say out of their own pocket - the few dollars that it costs will not affect your income and will create a vast multiple in terms of productivity and loyalty compared to the minimal outlay. In times of crises give clear thought to how you can reward your employees.

Reframing can change your electrical pathway in your brain. Simply if you reframe something you change the way you think about it. You change perception. Reframing is simply the classic "Is the glass half full or is it half empty?". In neuroeconomics we have long known that the brain reacts differently when something is framed as a potential gain or a potential loss in 50/50 gambling situations [10]. Reframing people's intentions shifted their perception but also brain activation in a 2010 study [11].

Reframing a crisis as an opportunity may sound cheesy but it can work. However, that is often too big and lacks authenticity. If 200 people are losing their job and the senior leader talks about opportunity it will understandably meet with some resistance. However what we can do is create perspective. An example of this is while consulting a leader in a major multinational and faced with his management offsite meeting with impending cost costs and job losses we decide to look at the history of the company. This was an old company and we showed the team how many recessions the company had already been through how many costs cuts the company had survived and continued to thrive. This shifting of perceptive took the fear out of the cost cutting scenario. This combined with L (Limiting) from above lowered the fear dramatically.

When talking of the Greek debt crises the one reframe that all the Finance Ministers have failed to do is to put the Greek debt into a bigger frame. We make unconscious assumptions as I have already said. We assume Greece is like a Germany or an Italy. It is not. Its GDP is only 2% of the Euro GDP and is over indebted to the value of a minuscule 0.6% of the European GDP. Yet the debt crisis has been enough to wipe 50% off the value of the Euro. Why? We didn't have a frame of reference and all the politicians missed this point. "Yes Greece has a problem but remember its debt surplus is only 0.6% of European GDP so we must take it seriously but it has little real impact on the Euro". What a shame for the Euro and here we can see how communication and fear can spread through broad economic markets and kick of a negative spiral that can accelerate and is hard to halt once it gains momentum.

Vision

Visions are really easy to write and formulate when times are going well. In fact corporations have wonderfully formulated visions. But again these have the unfortunate habit of flying straight through the window at the whiff of a crisis. What happened to all the visions of all these companies during the financial crises? We didn't hear of many. Visions had died a death. A sudden and painful death – dying in loneliness forgotten by senior management. Firstly remember that if your vision cannot take account of crises situations it is not a vision or you are not capable of leading through it. Fact – sorry but true.

What does a vision do? It creates unity, it creates direction and this means it unifies and aligns interest hence increasing trust and lowering amygdala activation. A strong vision will keep your company together, it will motivate and it will give energy and motivation (assuming it has been well formulated – see next paragraph). The time that a company needs a vision most is during a recession, a crisis, a tough period. That is when you need someone to stand up and tell you that you have a dream, that you will fight on the beaches and in the air, that victory will come, it may be painful, you may make sacrifices but it will come. Powerful visions will drive individuals, companies and groups of people and whole nations through times of great turmoil. No vision, no direction and no success.

A vision must be living it must be touchable it must feel real. To have a dream, a dream that my little girl can one day play with white children, is powerful touchable and realistic and shows the power of Martin Luther King's brilliant speech. I have a dream is so simple, so real and so true and the way he speaks about this dream is touchable. It is a living a dream, a dream we can imagine and see ourselves standing in. If your dream states we want earnings per share to reach 10 cents in the dollar, you have a financial statement not a vision. A vision is tangible - a living human vision.

And the vision has to be viable that means live-able that means realistic. Your people have to be able to believe in it to see the realism. It can be challenging, it can be very challenging but it must be possible. If it is real, your people will be motivated and they will have direction. They will have a goal they will forget about their active amygdala and their reward centres will focus on achieving the vision. All great sports stars say: "I knew I could do it". Their vision tied in with what they perceived as reality. "I believed in myself", "I knew it was possible". Recently a major bank I consult at announced a vision based on earnings. Not only was this unliving but a very senior manager I spoke to commented in exasperation, "What are those guys thinking of". He was not bought in to the "vision" from the second it was announced. Will the company achieve their goals. I am sure they won't.

The vision has to be evocative it has to generate emotions (back to emotions in E). When I show the video of Martin Luther King giving his I have a dream speech. You can see how people are taken by it. You can see almost as the hairs start to stand up on the backs of their necks. You can visibly see how people are moved. It is a moving speech. Maybe even more now as we see so clearly how unjust his situation was and our prejudices against the black community have melted. Martin Luther King has a very, very powerful and emotional vision so powerful it lies at the heart of human existence. But his speech also highlights something for corporations because it shows the yearning to have value, to become valued, to become a real person and to be accepted as equal (and here we are back to A appreciation and L being listened to).

Companies generate visions that sound like balance sheets, they have no passion no life and no emotions. This is not a vision. Sure companies should earn money, I passionately believe in this. But if you want to take 10 people, or 100 people, or 1000 people, or 10'000 people, or 100'000 people with you, you will need to generate some passion and drive that will get the hair on the neck standing up and activate emotional centres. This will give drive and it will moderate the amygdala. The amygdala will be forgotten because the vision is so powerful you will forget your fear of the battle. The battle is simple a means to achieve your goal, your vision, your dream and if that is so emotional and engaging all else will be pushed out of your mind.

Now so far so good. You can start to see how everything ties into everything and into the human brain and how these simple strategies need to be implemented but the contradiction is this: as the amygdala of the senior leaders activate it is even more difficult for them to implement the above strategies. Their minds are becoming clouded, their clarity reduces as the amygdala pump powerfully. Their ability to make balanced decisions drops a level or two as will their ability to deal with complexity. This leads us into the field of sensitive brains and calm leadership or even fearless leadership. An underestimated skill for senior leaders. The distortions that we know will be happening in their brains will be powerfully and often subtly and imperceptibly affecting decisions.

Implementing a CLEARVision strategy requires an ability to see through the fear and keep at the human level. You may be wondering how to do this. I will first give you some examples of simple to implement strategies from business. And then give examples of what could have been done in another situation. CLEARVision can be implemented at the team, department and corporation level. In our Spheres of Impact on a few pages ago we can apply Amygdala Intervention strategies:

Individual: Individual interventions (coaching)

Team / Department: CLEARVision

Company: CLEARVision

Economy: Governmental CLEARVision (including national agencies and associations)

Regional (e.g. EU) / Global: Intergovernmental CLEARVision (including regional agencies and associations)

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## Case Studies

ABB - The Crises Years from 2001.

In 2001 ABB, one of the world's largest industrial organisations, was a breath away from bankruptcy. This would have sent shock waves through the market and particularly in Switzerland where it has its headquarters. In September 2002 Jürgen Dormann took over as CEO to try to save the company. The day he started work Jürgen Dormann sent an email to all 150,000 employees. The letter in itself was not so special – the process afterwards was.

The Dormann Letters continued every single week. They communicated clearly openly and honestly where the company was and where they were going. There were general observations and concrete facts. It helped align everybody to the exact situation ABB were in whatever unit or country they worked in. Even more importantly is the feedback function they served – it was also an opportunity for employees in whatever role to give feedback. The feedback was noted as Jürgen Dormann with his head of Human Resources, Gary Steel, went through the feedback over the weekend after the letter had been sent. He then, importantly, incorporated responses and remarks to the feedback in the next Dormann Letter. This more than anything showed that the CEO was listening to his 150,000 people – that the remarks were taken seriously...and every one of those 150,000 people was informed openly and honestly with an opportunity to respond.

In short the "Dormann Letters"

Kept everyone informed

Made sure everyone had the same information

Aligned all employees to the situation

Showed respect for employees

Gave an opportunity for open communication

Showed employees their concerns were taken seriously

With relevance to the CLEAR Vision model he:

C: Communicated, created clarity

L: Listened

E: Aligned everyone that the enemies were not inside

A: Aligned interests, they created action by making local managers and team leaders responsible

R: The Dormann letters were a ritual, creating reward in the context of social value, and helped create another frame (reframe) for the issues at hand

Vision: he communicated a vision of where ABB was going and how this was to be achieved. It was viable.

ABB came through this well, recovered and have been growing since. After that experience, and with the strong loyalty to the company, turnover rates in senior management are extremely low, ABB glided through the recent recession with scarcely a hiccup. Yes, they had to make tough decisions but the vision was and is clear for them and after the experience of 2002 a mere global financial recession is a challenge that is relatively easy to overcome.

This shows how an Amygdala Intervention Strategy can be an intuitive process with great intuitive mangers who value their people such as Jürgen Dormann and Gary Steel are. My recent conversations with Gary Steel have supported this. So you may ask where will neuroscience help indeed here it explains much of why ABB were successful and this is coupled with another of additional components such as trust in their people, autonomy and honesty. All very powerful. Could they have done better? Well, we could always do better. More emotion and more evocative language could have been used. More choice could have been given and more thought given to rewards (social rewards included). More thought could also have been given to rituals internally and use of reframing could have been used more powerfully also. Yet all of this said, the Dormann Letters are a fantastic example of how well simple techniques with or without the knowledge of brain science can help.
Senior Finance Executive – Budget Cutting and Job Cuts

This is a case of a senior finance person at a major multinational who shortly after taking over his role was faced within his first few months of communicating, during his first international meeting with his extended team, of impending budget cuts, potential job losses within the management team and then to find solutions to these. This was combined with the fact that the person who had been in competition with him for the new position was also part of this management team and there were some underlying negative feelings.

I sat down with CM and we developed a strategy for this full-day event and for going forward. CM was understandably worried that the meeting may go off track and lead into unproductive bickering and argumentation combined with resistance and negativity. I assured him that if we set it up properly this would not be the case. And what happened was it a success? Indeed at the end of the day the room was filled with a sense of satisfaction at having solved so many problems, with clear next steps and with a clear vision and more importantly with everyone on board to create the vision of being one of the best units in the globe. Budget cuts had been proposed - managers in the room had even accepted that their jobs may be redundant without a squeak. How had this happened?

It had happened because of careful brain based approach and the complete absence of fear:

Setting a CLEAR Vision – this was powerfully implanted at the start of the day.

Careful and powerful communication (there is a whole theory on the power of brain-based communication here also but not the purpose of this eBook).

The vision was clear, the communication was clear, the choices were clear.

The vision was communicated emotionally, managers were asked if they wanted to buy in to it, if they could commit to it, if they wanted to commit to it (choice).

Empathy and understanding was shown to those in particularly difficult situations.

We developed an enemy together. The enemy was inefficiency and bad use of resources.

We aligned interests to the value of the whole team, aligned to the vision which everyone had had the opportunity to choose and be a part of.

We created an action plan for everybody to be part and be involved and engaged in the vision. Clear simple actions that were achievable within a short time frame.

We showed appreciation for the contribution to everyone there.

We set up some rituals that were to be continued going forward.

We put the current scenario into a historical context and reframed this in terms of historical significance. This also ties into another powerful strategy for security and amygdala deactivation: history and stability. In times of crises we shift our preference to stability to old-fashioned values and companies that have been there for a long long time.

And the vision was powerful, emotional, evocative and viable...and exciting.

All in this meant that the day finished as a huge success CM the leader being amazed at how positively it had all gone. And you may well ask how did it go after that. Well as I was continuously involved I could watch with satisfaction as it developed. And develop it did. The team and unit managed to cut costs quicker and more efficiently than other units. Motivation remained high. They achieved recognition in the organisation for being the best. They achieved recognition internationally through receiving international awards in their field. And the Leader, CM? He has now taken on another role and is shortlisted to be the next Executive Board member of a major multinational. Engage the brain and you will engage the person and you will accelerate human performance. It's that simple.

Indeed this also highlights that neuroscience in business context can smoothly ingenerate with standard processes and can be implemented seamlessly at various levels. There does not necessarily need to be a complete refocus of an organisation. Rather the insights help give clarity at different stages of a process – whether in a kick-off meeting, an innovation process, a new strategy, a crises and turn around or simply a new HR process to be implemented. With HR it has many obvious areas where it can be applied as HR is directly involved with the human processes in the company. Human processes mean people processes and ultimately mean brain processes.
So what about companies that could have done better? The recent crises has thrown some obvious cases into the spotlight. But being based in Switzerland let's look at banking and we will call this company, with reference to real life institutions, "the Bank". This could directly apply to any of the major instituitons that were hit during the financial crises. During the financial crises what went wrong (apart from losing money) and what could they have changed with a focused Amygdala Intervention Strategy.

Banks during the financial crises

What could the Bank have done with CLEARVision? Could it have helped in what is, without question, an extreme situation?

Firstly there would need to have been a personal amygdala intervention strategy for the leaders because the leaders themselves were clearly in amygdala overdrive and were incapable of making balanced decisions. Without this there would not be any progress, as we have discussed, because this Amygdala over activation will distort all decisions and interactions by the leaders. Dr Srinivasan Pillay of NeuroBusiness Group has developed some groundbreaking coaching interventions targeting brain-focused strategies in personal coaching contexts but this is not the purpose of this eBook. These are the type of interventions that the leaders would need to be taking.

What then could the Bank have done assuming that the individual leaders now have calm amygdala (remember mirror neurons – this will stop infecting the whole business and calm the environment).

Now the communication will need to be clear, emotional human and ritualised. Instead of having an ad hoc communication policy (aside from legal requirements, of course) they could have set up daily conferences with questions & answers to the senior management.

They could have set up weekly teleconferences with the senior management for employees with an opportunity to ask questions. Applying: communication, rituals, listening, let it out.

At the branches there could have been, for example, Friday afternoon speak to the bank manager sessions, with coffee and biscuits. Come and have a coffee and rant (let it out) at the bank manager. This allows for human contact and trust building amongst the customers.

They should have set up a hotline. During the financial crises the only communication was coming through the newspapers. In comparison during the Swine Flu scare the Swiss government set up a hotline within 48 hours so that concerned individuals could inform themselves and feel more secure.

There was no communication by email, by letter or even on the website. The website should have had an immediate link and numerous pages in clear language with clear pictures explaining what had happened. There was nothing. I was, I admit, continually astounded by how little real proactive communication was coming from the financial sector and the banks. Indeed quite a shocking neglect on behalf of the banks and finance sector as a whole.

There should have been a limiting strategy of explaining that the Investment Bank was different to the Retail Bank. The retail bankers got the blame but those poor souls slaving away for the retail bank had nothing to do with the crises and were at the brunt of client aggression. Lack of communication and clarification from the Bank. This may sound as if this is going against all the one-company strategies. It is not, it is creating clarification.

There was a potential host of other activities that could have been implemented quickly and easily. Nothing was. Communication was short and retrospective, there was no vision. Cost cutting was announced, job cuts were announced, often with employees learning from the press rather than from their leaders. Needless to say employee motivation plummeted and has stubbornly stayed low ever since. Reputation plummeted and has stayed low ever since. Clients fled the bank in droves. Some have returned as the economy has improved but not all - some business lost is lost for good.

And here an example of leadership decision-making that I came across highlighting some of the faulty thinking processes that seem to have become embedded at the Bank. During the immediate post-loss cost-cutting phase one senior manager I was dealing with noted the following. He had now been assigned more people and had to integrate another department into his own. For this purpose he had arranged on offsite meeting so that everyone could be aligned. He had done this at low cost in a three-star hotel and had avoided luxury and all possible costs. It would have set his budget back by CHF 4000 for 18 people. Note that he was responsible for a yearly budget of CHF 70 million. Well done, you may think. Alas not, his boss when he heard of it, ordered him to cancel it because it was an unnecessary cost. His boss had therefore taken away his choice, taken away his autonomy, blocked communication and blocked alignment. All of this is nutritious food for the hungry amygdala. This is just to highlight the sort of decision-making processes that are still rife in the Bank and still guaranteed to send the amygdala off track and guaranteed to lower trust, loyalty and motivation.

This is in contrast to ABB who had intentionally given their leaders more choice and more judgment through their Leadership Challenge Programme. The Bank was doing the opposite: taking away the power of their people. As you can well imagine the motivation of this leader previously mentioned plummeted. His costs didn't - he still had to align his organisation but it would be a more costly path but less readable on the balance sheet. This is a questionable leadership style indeed. A style guaranteed to send the amygdala rocketing and that of the whole organisation. Leading to lack of motivation, bad decisions, and less efficiency. Indeed three years on where does the motivation stand at the Bank? It is still depressingly low and the Bank is truly yet to recover. Not surprising considering that the policies implemented have counteracted the way the brain functions. And it all could be so easy.

## Final Words

So that leaves me with a few words to finish off. What brain science is showing us with clear concrete and visual clarity is that many factors that we have considered soft are in fact hard biological processes. If you want the tool, the resource, the human being to function at their optimal you have to have systems and methods that target and maintain the brain, indeed the Central Nervous System as a whole, the motor of human action and cognition. Without that you will be fighting an uphill battle. The reason that so many companies can get away with brain unfriendly techniques this is that firstly they don't know better and secondly there are few companies that are doing it really well. Those companies that ignore the brain will, with the latest scientific research being taken on by more and more companies and leaders, slowly fall behind. Those companies that apply the knowledge of how the brain and human beings work will have a rich and fulfilling future. Those that do it earlier rather than later will accelerate forward into a more optimistic future.

Brain science can be easy science and it is fundamentally human science and much of what we know can be applied quickly and easily at a relatively low cost. I would highly recommend you to start thinking more clearly about brain processes in your organisation.

Wishing you happy brains.

Andy Habermacher

Copyright © 2011 by Andy Habermacher

Leading 100 billion neurons, journey into the brain and how this impacts business and leadership.

by Andy Habermacher

A short eBook based on keynote at the annual symposium of The International Human Resource Community Switzerland, Zurich, May 2011

