The best ideas in an organisation do not always come from the people at the top.

Employees closer to customers, products and daily operations often see problems long before senior management does. They may also have ideas about how things could be improved.

But there is a problem.

They have to be willing to speak.

Research and analysis from INSEAD highlights the importance of psychological safety: creating an environment in which people feel able to ask questions, admit mistakes, challenge assumptions and express concerns without fearing humiliation or punishment.

For leaders, this presents an important challenge. Telling people that they are free to speak is easy. Creating a team in which they actually dare to do so is much harder.

Silence can be expensive

Imagine that a junior employee notices that an important project is heading in the wrong direction.

Everyone else appears enthusiastic. Senior managers have already invested considerable time and money. The employee has doubts, but saying something could make them look negative, inexperienced or difficult.

So they remain silent.

That decision may seem insignificant. But multiply it across an organisation and silence becomes dangerous.

Mistakes remain unchallenged. Weak ideas survive. Problems are discovered too late. And leaders gradually become surrounded by people who tell them what they want to hear.

Psychological safety is therefore not simply about making employees feel comfortable. It can affect how effectively a team learns, adapts and performs.

Leaders have to make disagreement possible

INSEAD professors Mark Mortensen, Maria Guadalupe, Nathan Furr and Henrik Bresman argue that leaders can actively build psychological safety rather than simply hoping it develops naturally.

One important element is the behaviour of the leader.

If a manager reacts defensively whenever someone questions an idea, employees quickly learn that disagreement carries a price.

If leaders instead show curiosity, acknowledge uncertainty and demonstrate that they themselves can make mistakes, they send a very different message.

Questions become legitimate.

Disagreement becomes information rather than disloyalty.

And admitting a mistake becomes an opportunity to learn rather than something to hide.

Psychological safety does not mean lowering standards

There is an important distinction.

A psychologically safe workplace is not a workplace where anything goes.

Leaders can still demand excellent performance. They can challenge employees, set ambitious targets and hold people accountable for their work.

The difference is that employees should be able to say:

I don’t understand.

I think we may be making a mistake.

I have another idea.

I need help.

That distinction matters because organisations need both high standards and open communication.

A team in which nobody is afraid but nobody is accountable will not necessarily perform well. But neither will a team with extremely high expectations where employees are terrified of admitting that something is going wrong.

Good leadership requires both.

Safety can exist within teams — but not necessarily between them

The INSEAD researchers also point to a less obvious problem.

An organisation can contain individual teams with high psychological safety while communication between those teams remains difficult.

Members of one department may speak openly among themselves but hesitate to challenge another department. Teams can develop their own identities, assumptions and ways of working.

That means leaders must look beyond the atmosphere inside individual teams.

They also need to create conditions in which people can communicate honestly across organisational boundaries.

For increasingly complex organisations — where projects often involve people from different departments, countries and professional backgrounds — that becomes especially important.

A lesson for future leaders

Young leaders sometimes assume that leadership means having answers.

It may be more important to create an environment in which people are willing to tell you when your answer is wrong.

A leader who is surrounded by silence may feel powerful. Everyone agrees. Nobody objects. Meetings are easy.

But that apparent harmony can be an illusion.

The stronger leader is the one who can hear uncomfortable information without punishing the person who delivered it.

Because leadership is not about ensuring that everybody agrees with you.

It is about creating a team in which people dare to tell you what you need to hear.

Leadership field: Team Leadership
Subfield: Psychological Safety

Source: Mark Mortensen, Maria Guadalupe, Nathan Furr and Henrik Bresman, INSEAD, Effective Strategies for Building and Boosting Psychological Safety, 9 October 2023.