Turning Around Failing Organizations: The Power of Positive Expectations

April 2, 2010 / General /

By Robert E. Quinn

Last week I watched a video of a school principal who turned around a failing school.  The next day a colleague told me the story of a navy captain who transformed a troubled ship.  The next day someone told me the story of the transformation of a manufacturing plant.  Each story was inspiring.

I always think of these transformational stories as rare.  They are rare in that most troubled organizations stay troubled.  Yet it dawned on me that, in the overall scheme of things, organizations are often transformed.  These seemingly rare stories occur with some regularity.  While each situation is unique and what the leader does is unique, there are some general patterns that occur in every case.  The patterns have to do with vicious cycles, virtuous cycles and with positive expectations.

In her book, Confidence: How Winning Streaks and Losing Streaks Begin and End, Rosabeth Moss Kanter examines vicious and virtuous cycles in sports, business and politics.  She makes an important connection between virtuous cycles, vicious cycles and the role of confidence in the process of collective success.


Virtuous cycles and vicious cycles are mirror images.  Both success and failure tend to shape perception.   Winning creates a generalized, positive bias while failure creates a generalized negative bias.  The positive perception of a team or organization tends increase the willingness of people in and around it, to invest in it.  Employees increase their commitment, recruits are more attracted, customers are more loyal, and investors more willing. In uncertain situations, the actors in the system get the benefit of the doubt.  Since they have been successful, it is assumed that they are now making good decisions.  In failing systems, all the opposite tendencies arise, it is assumed that the decisions are bad, and the system spirals downward.


At the heart of these two patterns is the notion of confidence.  Confidence is defined as “the positive expectation for favorable outcomes.”  When confidence goes up, people expect to win.  In the moments of extreme challenge, they are more willing to make the necessary extra effort.  Confidence creates positive momentum.  It leads to the assumption that conditions are getting better, the expectation of success and the emergence of a self-fulfilling prophecy.

According to Kanter, confidence is at the heart of social life, and it tends to unfold at four levels:

  • Confidence in self increases when there is a trajectory of success.  When we are winning we feel good and these positive emotions lead to positive thoughts and behaviors.  We are willing to work harder when we have positive expectations.  These positive expectations we hold for ourselves increase the likelihood of success.
  • Confidence in interpersonal relationships increases because winning creates liking, or the desire to be together.  Positive characteristics such as generosity, commitment, respect, trust, support and sharing increase.  The organization benefits from shared vision and mutually enhancing efforts.
  • Confidence in the system increases.  During cycles of winning, the organizational structures, processes and routines give rise to success and are also seen more positively.  People have confidence in the system and tend to stay in their jobs longer, resources are available and people get more training, further perpetuating confidence in the system.
  • Confidence of the people in the external networks increases.  During periods of success, investors, members of the media, opinion leaders in the community, politicians, customers, potential employees and others all become more willing to invest. This external support further elevates the assessment of internal people causing them to further invest in what they are doing.


In this blog we often refer to the four “Lift” questions (see last week’s entry).  They are tools for self-elevation, for creating confidence in self so as to build the confidence of others.

When we ask the first questions, we create positive expectations about our own future.  When we ask the second question, we ground those expectations in our own values.

The third question is designed to shift us from a self-focus to an other-focus.  As we make this change we create more positive expectations in our relationships.  As these relationships improve, the group begins to perform at a higher level, creating positive expectations for the overall system.  As the overall system begins to improve, external support will begin to increase.

The fourth question is designed to open us up to feedback and learning.  When we are externally open, we are more likely to have insights and to choose creative paths.  These new ideas and new actions signal that others should invest in what we are doing.  Our creativity increases their confidence.

Transforming an organization means we have to build the confidence of others.  This process begins, not by changing others, but by first changing us.

Organizations begin to change when one person “lifts” self to higher positive expectations and then attracts others to higher positive expectations.