Psychological safety in the workplace: Change your culture, change your margins

High employee turnover rates, low productivity, and discontentment are symptoms of a toxic work environment.

When your team can’t articulate your expectations, don’t feel free to express their ideas, and fear giving constructive feedback, that’s not an HR problem. That’s what’s killing your bottom line. 

Psychological safety isn’t a trend; it's a practical approach proven to deliver measurable business outcomes. Companies that prioritize psychological safety see 25% higher profitability, significantly lower turnover costs (saving 50-200% of each retained employee's salary), enhanced creativity, and a stronger competitive edge. On the flip side, workplaces driven by stress and burnout drain resources, undermine quality, and limit growth. 

It’s time to rethink the old-school belief that high performance requires high stress. Leaders who shift toward psychological safety in the workplace see real, tangible benefits: happier teams, smoother operations, and healthier financial results.  

Annie Hancock, founder of Fortify Optimal Health, has dedicated her career to boosting workplace wellness and turning psychological safety into a business goldmine. 

Top-down vulnerability makes teams bulletproof. 

Toxic workplaces are morale killers and success drainers. High turnover, stalled productivity, and team disengagement are often the direct result of environments where expectations are unclear, feedback is feared, and creative expression is stifled.  

But here's the good news: just as negative behaviors cascade downward, so can positive, powerful ones. 

When leaders embrace vulnerability—asking for help, acknowledging mistakes, and welcoming feedback—they transform workplace culture. When Satya Nadella took over as Microsoft's CEO, he didn't just issue new directives—he modeled a completely different approach by publicly acknowledging missteps and asking for honest feedback about his leadership. The result? Microsoft's market cap hit over $3 trillion under his leadership. 

Vulnerability at the top signals safety throughout the organization, empowering teams to speak openly, innovate boldly, and collaborate fearlessly. In turn, teams become resilient, creative, and highly productive. 

Annie Hancock champions an integrated approach to breaking these toxic cycles. Her work alongside Navy SEALs highlighted that even in environments emphasizing strength, allowing vulnerability and emotional openness is essential for genuine psychological safety. Because of this, she advocates for both executive-level and employee-driven interventions that rewire our ingrained stress responses, creating healthier neural pathways and sustained change. 

Here are three steps Hancock suggests implementing to help take you and your team from stressed-out stragglers to high-performing superstars: 

1. Identify: Understand how your thoughts influence your perceptions and behaviors. 

2. Develop: Build a daily mindfulness practice to reframe those thoughts and build mental resilience. 

3. Apply: Implement mindfulness strategies when faced with triggers or high-stress scenarios to reduce reactivity. 

   
   

Empower your team, see your company flourish. 

Companies thrive when teams feel genuinely valued and supported. Teams with a strong sense of safety consistently outperform those who don't, driving innovation, efficiency, and ultimately, profitability. 

Google researchers confirmed this in their groundbreaking Project Aristotle study involving over 100 teams across multiple disciplines. Surprisingly, the top-performing teams weren't necessarily composed of superstars or caffeine enthusiasts. 

Instead, the strongest predictor of team effectiveness was psychological safety—the freedom to share ideas openly and take risks without fear of judgment or reprisal. 

Further reinforcing this insight, a 2023 study showed a clear positive link between psychological safety, team learning dynamics, and overall effectiveness.  

Another 2023 McKinsey study showed clear positive links between psychological safety and business outcomes, including: 

• 27% reduction in turnover 

• 32% increase in innovation metrics 

• 41% higher employee engagement 

• 25% greater productivity 

  
  

The takeaway is clear: cultivate psychological safety, and you unlock your team's full potential. 

Small investments will lead to transformative results. 

Real, lasting change doesn't require massive overhauls; it often begins with small, deliberate investments. Employers dream of loyalty and peak performance yet frequently overlook the need to earn them through consistent psychological support. Hancock emphasizes that loyalty is built from the ground up through trust, respect, and empathy. 

Try these practical moves that successful organizations have implemented: 

• Start team meetings with a quick wellness check-in 

• Create dedicated channels for raising concerns without fear 

• Develop clear escalation paths when psychological barriers arise 

• Avoid phrases like "whose fault is this?" and instead use "what can we learn?"

Drawing insights from healthcare, military training with the Navy SEALs, and extensive research, Hancock underscores that even diverse and high-performing teams require intentional effort to maintain psychological safety. She understands behaviors often serve protective purposes but may become counterproductive over time. 

You have to be prepared for the journey. Harvard Business School research shows that meaningful cultural changes typically require 18-24 months of consistent effort before becoming self-sustaining. Companies that give up after a few months never see the full benefits, while those who persist transform their workplace dynamics permanently. 

Through Fortify Optimal Health’s corporate wellness program, Hancock equips leaders and teams with the tools and guidance needed to shift these behaviors, fostering better communication, deeper belonging, and genuine passion in the workplace. Her approach transforms psychologically fortified seeds into thriving, profitable forests. 

The real question isn't whether you can afford to invest in psychological safety—it's whether you can afford not to. Companies that master psychological safety don't just retain talent better—they innovate faster, collaborate more effectively, identify problems sooner, and ultimately deliver superior financial results. 

Build a culture where great ideas are shared freely, and problems are addressed promptly and directly. Your team is waiting for you to lead the way. Invest in psychological safety and watch your team—and your profits—flourish. 

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Fortify Optimal Health is a premier telehealth provider specializing in primary care and neuroscience-backed wellness programs. Learn more about its comprehensive approach to wellness and founder Annie Hancock at https://fortifyoptimalhealth.com.  

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For a more in-depth look at Annie Hancock's approach and work philosophy, check out our 45-minute interview: The Secret to Resilient Teams.