Storytelling and employee engagement

by Matt Grimshaw
August 9, 2016

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This article concerns the use of storytelling to improve employee engagement in large organisations. It reflects briefly on the business case for employee engagement; sets out a narrative perspective on engagement; the advantages and limitations of strategic narratives as engagement tools; and introduces the concept of a mediating narrative as the keystone to creating meaningful engagement in large organisations. Finally, the paper considers how senior leaders, middle managers and internal communications teams can utilise the concept of mediating narratives to create an engaged and flourishing organisation.

The business context

At its heart, leadership is about getting people to do what you want them to do. There are noble leaders and ignoble ones, but effective leaders are people who exercise power and influence over the thoughts, feelings, decisions and behaviour of others.

This leadership challenge is perhaps at its most acute for those running large, multinational organisations. The leaders of such organisations have to influence thousands of people, working across the globe; people who speak different languages, with different cultural heritages and life experiences. The leader cannot simply broadcast a clear and consistent message and expect to effect change, because the factors influencing the mindsets and behaviour of these employees are so variable and complex. One size won’t fit all.

Instead leaders need to find ways of communicating that allow them to connect with individual employees and to accommodate their different perspectives. In doing so, it is important that the leader is conscious of balancing their degree of influence over the organisation. Great leaders are neither too authoritarian nor too diffuse.

To be effective, a leader of a large organisation must be able to bring people together and to co-ordinate their efforts towards a shared vision and common goals. Similarly successful organisations have a cultural integrity with common values and a consistent brand proposition.

However, if this centralising or convergent tendency is left unchecked, then over time the organisation will become increasingly slow, rigid and fragile. Innovation will wither and customer experiences will become stale, inauthentic and uncaring.

Therefore, at the same time as bringing people together, the leader must also ensure there is space for autonomy, discovery and divergence from the prevailing orthodoxy. For large organisations to be agile and to move at pace, senior leaders need to create space for local decision making and risk taking so front line teams can innovate and find new insights. This is a dynamic balance: at certain times and in certain parts of the business, the convergent influence will need to be stronger than the divergent one and visa versa but it’s our contention that managing this balance is the key to leading large organisation. If they can triumph over these challenges, leaders can create truly special organisations. Companies capable of aggregating the passion and effort of thousands of people without losing their character, humanity and responsiveness to the outside world. 

A narrative perspective on employee engagement and what it means to be an engaged organisation

Every employee has a narrative[1] about what it means for them to work for their company. This narrative is the combination of their past experiences, their present concerns as well as their expectations and hopes for the future. Over time, certain aspects of the narrative become stronger as they are reinforced by similar experiences so that the dominant themes of the narrative become an increasingly robust model that the employee uses to interpret and assimilate new information and to make predictions about the future. Take for example an employee who has experienced multiple rounds of redundancies and restructuring. They will have developed a personal narrative about the company, its prospects and the way it’s managed. When they hear a leader announce “we’re looking for efficiency savings” they interpret the message through the lens of their existing narrative and hear “there will be job losses”.

Our view is that companies also have narratives (whether these have been deliberately articulated as stories or not) — commonly held and reasonably consistent mental models that people use to understand the company and its interaction with the world. For every company, it is possible to plot the journey the business has been on and its change over time. Every company, implicitly or explicitly, has an expectation about what its future will look like and has made a strategy to bridge the gap between its present circumstances and its desired destination.

Taking a narrative perspective on employee engagement then, is to look at the degree of alignment between employees’ personal narratives and the overall company narrative. The more engaged the organisation, the greater the degree of congruence between employees’ narratives and the overall company narrative.

In engaged organisations, employees accept the company narrative as accurate, useful and inspiring, not vague and rhetorical. Indeed, they will use the company narrative as a way of defining their own identity and as a way of creating a sense of meaning, progress and higher purpose in their work. In these circumstances, employees feel significant because they can see a connection between their day-to-day work and the overall progress of the organisation, but the sense of engagement doesn’t solely derive from employees feeling like they are on the same journey as their company, it also comes from a sense of shared identity and of belonging to a group with shared values.

It is important to recognise that creating an engaged organisation in this sense, is not about imposing a company narrative on individual employees. It is not a ‘top-down’ process. Indeed one of the defining qualities of an engaged organisation is not how well it communicates out from the centre, but the opposite — how well it celebrates, finds meaning and new insights in the  stories from the front line.

The engaged organisation then, is one that has found a narrative equilibrium to match the leadership challenge of balancing convergence and divergence. Employees must find the company narrative meaningful (it should exert an influence on how they see themselves and the world around them), while at the same time, employee narratives must continue to influence the development of the company narrative — how the company sees itself, the world around it and what it is trying to achieve.

There is now compelling evidence that this type of engagement is not only beneficial to the company, but that it also creates the type of  meaningful work environments in which people flourish. Where people can excel in complex, multifaceted roles and where they can feel a sense of emotional and social connection to the value being created by the organisation.

What is a strategic narrative?

The MacLeod Report, published in 2009, cited a “strong strategic narrative” as one of its four key enablers for improving employee engagement. However, the report makes no real effort to define what a strategic narrative is, beyond “something that provides a clear, shared vision for the organisation”. Since the practice of creating stories for organisations is now well established, I think it is possible to give more substance to what is meant by the term ‘strategic narrative’.

In line with the terminology used in this paper a ‘strategic narrative’ is perhaps better thought of as a ‘company story’[2]. It is a deliberate attempt to articulate a company’s strategy, vision and values in the context of its current challenges and opportunities it faces as well as its core purpose, history and character. It’s crucial that a company story describes a change over time; it should be a story that encapsulates the key elements of the past, present and future of the organisation[3] in a way that imposes some sense of order, agency and perspective on events. In the context of this paper, the motivation for creating a company story is to help leaders influence the way their employees think and feel about the company and its operating context, with the intended effect of aligning the behaviour and decisions of employees[4].

Why company stories should be a useful tool for leaders looking to create an engaged organisation

We think in narrative form

People  have a tendency to think in narrative form. We use narratives to make sense of the world around us, to impose a sense of order and to create meaning. We are naturally inclined to use narratives to stitch together meaningful sequences of past events, to make sense of our present perceptions and to make predictions about what will happen in the future.

When we interpret the world around us, our existing narratives help us to determine which perceptions to attend to and we resolve the ambiguity in our perceptions by making them coherent with our existing narratives. Indeed, in the view of psychologist Daniel Kahneman, our sense of confidence in our judgements is not driven by how accurately they correspond to reality, but by how coherently they fit together as a story and the ease with which we attach them to an existing narrative.

The traditional ‘command’ approach leaves too much space for ambiguity

In large organisations, the traditional approach to communications is for leaders to tell people what they want them to do (in better led organisations, this is both ‘what’ they would like done and ‘how’ they would like it done). These commands are akin to the ‘middle’ of a story. For people to understand what the orders actually mean, they have to put their own context around the ‘what’ message.

The critical point is that leaders tend to drastically underestimate the inherent ambiguity in what they are communicating and the range of ways the same piece of information can be construed by different members of their audience depending on their personal narrative.

To help illustrate this point, look at the character in the middle of Figure 1. It is not obviously ambiguous, it’s a “B”, but it’s identical to the character in the middle of Figure 2 which we interpret as “13” because it appears in a different context. In many organisations, leaders are convinced they have clearly and effectively communicated to their people that they want them to “do B” only to discover weeks or months later that employees have been “doing 13”.

Figure 1

ABC image

Figure 2

12 13 14 image

When communicated in isolation things like values statements, strategic pillars and vision statements are merely elements of a wider narrative. Unless they are communicated as part of a company story, there will always be vast scope within a large organisation for them to be misinterpreted, misunderstood or misconstrued as employees integrate the messages from leaders with their own pre-existing personal narratives. When company stories are communicated effectively, they provide a comprehensive and coherent framework. This framework necessarily over-simplifies reality  in order to create a sense of order out of the complexity of a rapidly changing operating environment with multiple protagonists. The utility of  this clarity is that it helps align and speed up decision making and execution. By giving employees a common understanding of the context, the core purpose and history of the business, as well as where it wants to get to and why it’s important, a leader focuses the collective attention on the factors he or she sees as meaningful. In other words the leader gives employees their lens for interpreting the available evidence and for decision making. This leaves less room for ambiguity and less room for considering irrelevant factors, but not at the expense of removing genuine autonomy, local decision making and flexibility.

We are inclined to emotionally invest in the hero’s journey

Not only do we have a natural bent towards thinking in narrative form, we are also predisposed to seeing agency and causation in the world around us[5].

In the Western world, the most famous meta-narrative is the hero’s journey: stories about  people who start somewhere comfortable, but then face a challenge that they rise up to overcome, leaving them in a better or more enlightened place at the end of the story. When we read these types of stories or watch them at the cinema we are naturally drawn to associate ourselves with the hero and to invest emotionally in their success.

Engaging employees in a company story that alludes to this form, encourages them to identify with the company as an active protagonist — someone who can change the world around them for the better. This form of company story can become a vehicle for people’s emotional investment and attachment because employees will read themselves into the role of the hero in much the same way as their brain convinces them they are Batman when they are at the cinema[6].

What is special about this type of emotional engagement is that its integrated not adversarial. In contrast, it seems implicit in engagement tools like Employee Value Propositions, that the company and the employee are distinct — there’s an ‘us’ and ‘them’. However compelling an Employee Value Proposition, it’s premised on the idea that the motivations of the employee and the company are distinct. Our view is this tends to undermine solidarity and encourages a transactional employment relationship, rather than something bound together by a shared identity and purpose.

We use stories to shape group identity

In his book Grooming, Gossip and the Evolution of Language, Robin Dunbar sets out his theory that language originated as a more efficient way of forming reciprocal bonds and moderating behaviour within tribes than the grooming behaviour practiced by our monkey and ape ancestors.

Dunbar’s view is that we continue to use language in this way. His research has found that most of what we say is ‘gossip’, something that is an attempt to confer social standing or to influence the behaviour and cohesion of the groups we belong to.

There’s no workplace in the world that doesn’t have office gossip. We’re all extremely sensitive to signals and stories about how you need to behave to fit in, how you win favour or get promotion and who’s currently flavour of the month.

Communicating a company story gives leaders a framework for harnessing the power of gossip to moderate behaviour. A company story can be used to highlight, celebrate and reframe behaviours so they become representative of the standards held by the wider group. A good company story should also describe the organisation’s identity and character: who we are, what we’re like and what we do. Most critically of all it should give employees an implicit understanding of how you need to behave to  fit into the company and to be accepted.

A strong, positive company story should give employees a source of identity and pride that resonates with how they see themselves. Company stories that deliberately set out to delineate the identity of the group, its character and values help to create much stronger cultures and more cohesive organisations because they force employees to decide whether to fit in or to leave.

Why company stories (or strategic narratives) have not been the silver bullet for employee engagement

A ‘puff piece’ for CEOs, not a genuine effort to engage with employees

While a number of senior teams have gone to the effort of creating their company story, fewer approached the exercise with a genuine intent to spark meaningful change. For many it was an exercise they thought they ought to do, but being seen to do the right thing is not the same as doing the right thing. However polished the words on the wall, they can’t disguise a lack of underlying thinking or commitment and in these circumstances employees soon recognise them as mere rhetoric.

A great story, but a lack of great storytellers

An equally common problem, is that companies invest time and effort in developing a compelling story but do not invest in developing the storytelling capability of their leaders. We may all have a natural inclination to think in narrative form, but this does not mean we are all natural storytellers. Storytelling is a practical skill and an art. It can be developed and mastered, but no one is born a great storyteller.

The challenge is that audiences rarely distinguish between the quality of the message and the quality of the messenger. The old adage that it’s not what you say, but the way you say it applies. Indeed our view is that the information conveyed by things like setting, body language and tone of voice are processed more quickly by our brains than the content of a story which requires deliberate concentration in order for us to truly understand it. Because it is processed more quickly, the impression made by the storyteller and the setting feel ‘more true’ than the content of the story itself. Indeed our hypothesis is that these factors create a halo effect or first impression that then informs how we interpret the content. This is why no one trusts a leader who says they are 100% confident in the strategic plan, but who does so with defensive body language and in a barely audible voice.

Company stories are too remote to help guide employees to execute change

When senior leaders are genuine in their intent, we know of countless examples where company stories have been used successfully to engage senior managers at leadership conferences.

The big challenge is often what happens next and we know of very few companies that have been able to get their company story through the ‘marzipan layer’ of middle management so it becomes a living and meaningful reference point for all employees. Often the energy and high hopes created by a launch event quickly subside as it becomes clear that the story is not getting traction or penetration in the wider organisation.

The reason this occurs should be readily apparent from one of the key qualities of great company stories: namely that they need to be simple. This simplicity and abstraction is vital to creating a story that can apply to the whole organisation. However, while it helps to convey the ‘big picture’ the necessary generality of a company story becomes more of a challenge as you move deeper into an organisation. As you move further away from the head office or centre of an organisation, people’s personal narratives tend to be less concerned with ‘global’ themes, and are characterised by a narrower focus on the pressures and concerns of tactical, local execution.

Consequently, for the majority of people within a large organisation, the company story can often feel too remote, intangible and detached from how they see and experience their world. As a result, a company story may leave employees with a refreshed sense of context and perspective, but they are likely to feel detached and disconnected to the protagonist and critically, it will not translate into a meaningful day-to-day framework that guides their decision making and behaviour. For employees who want to know what they need to do differently or what they need to do next, the company story is too vague a guide and simply lacks bite.

This problem is exacerbated when leaders create company stories with the intention of transforming their organisations. In these circumstances the company story the leaders create has less obvious connection with pre-existing personal narratives across the organisation precisely because the intention of the company story is to challenge and reframe these narratives. This creates even greater dissonance and, if you follow the argument about narrative alignment above, until this is resolved employee engagement will actually decrease.

In these circumstances, simply communicating the company story is not enough. To effectively change the way people think and feel, there is a need to reframe employees’ personal narratives and experiences. This can’t be achieved by simply broadcasting out the company story. Instead it requires an ongoing conversation where leaders draw upon real instances of the changes they want to see and give these examples added significance by connecting them back to the company story.

Failing to engage in this sort of ongoing dialogue leaves leaders exposed to accusations that they’ve become detached from reality, that they “don’t really know what’s happening”. Similarly, leaders will become frustrated that having made the effort to inspire their people to change, they are not seeing the evidence of tangible progress and change. The company story thus becomes seen as a failed initiative to prompt change, a source of cynicism not engagement.

There are multiple groups within any organisation and employees tend to identify with a smaller, more local group

The final limitation with the way in which company stories have been used, is the attempt to engage everyone directly in the same story.

This approach belies the actual structure of the organisation. Within any large company, there are multiple groups. Some of these groupings are created by virtue of people being in different locations, some are due to different operating divisions or different functions. Each of these groups has its own narrative that delineates why it is different from everyone else and what the criteria are for people to belong to that group. In this sense, we think it’s also meaningful to think of groups like long service employees as having a different narrative to new joiners. In some companies, there are different narratives for male and female employees and so on.

In larger organisations, employees are adept at belonging to multiple groups. A given person might see themselves as belonging to both the Marketing function as well as the Social Media team; they might see themselves as both a UK person as well as a member of the Basildon office as well as being part of the high potential development programme and so on.

The impact of perceived group membership on pro-social behaviour

Recent experiments conducted at Lancaster University illustrate the impact of how people construe their group membership.

In the first version of the experiment, Manchester United fans were asked to fill out questionnaires about their interest in the team and the degree to which they identified as supporters. They were then asked to walk across the campus to see a video. Along the way, an accident was staged in which a runner slipped, fell and moaned in pain. Participants, were more likely to ask the runner if he needed help when he was wearing a Manchester United shirt than when he was wearing a Liverpool shirt or a plain shirt.

In the second version of the experiment, Manchester United fans were again recruited, but this time they were told they  were participating in a study about being a football fan, not specifically about being a  Manchester United supporter. They were also told that the study aimed to focus on the positive aspects of being a football supporter rather than the negative stories that usually get media attention. They were asked to complete questionnaires that asked them about their broader interest in the game and what they  had in common with other football fans. They were then asked to walk across the campus and again an actor pretended to slip, fall and groan in pain. However, in the second version of the experiment, participants were as likely to help someone in a Manchester United shirt as they were to help someone in a Liverpool shirt, and least likely to help someone in a plain shirt.

You can see this experiment re-enacted in Lego here!

What’s interesting is the extent to which someone’s opinions and behaviour can change depending on which group narrative is most prescient in their mind at that particular time. The experiment referenced above (The impact of perceived group membership on pro-social behaviour) illustrates this point very clearly[7]. It has been established for sometime that people are more co-operative, pro-social and collaborative with people they perceive as belonging to the same group as them. The nuance is the impact of how a person construes their group identity at any given time.

We have seen many occasions where employees have attended fantastic launch events for their company story. They have genuinely engaged in that story and have made commitments to change as a result. The challenge is that weeks later when they are back at their desks, they revert to a more local group orientation for which the narrative remains unchanged. To make the analogy with the experiment, they stop acting like football supporters and revert to being Manchester United supporters.

Our view is that employees’ typical focal point for their group identity is their immediate team. A good litmus test is to stop employees in the corridor and ask them where they work. Their instinctive answer will reveal the group identity they are walking around with. When people are within the confines of their own company, they almost always feel like they primarily belong to a sub-group, not the global corporation.

The role of mediating narratives

What is a mediating narrative

For the purposes of this paper, a mediating narrative is the narrative of a group that sits between the narrative of an individual employee and the company narrative.

It is unlikely that this mediating narrative will have been explicitly articulated as a story, but if there is a distinct grouping within an organisation its members must have a coherent and shared narrative that delineates them from everyone else. This narrative will encapsulate how the group sees themselves and how they believe they are seen by others. It will include some sense of journey and change over time. It will also set out what group members need to do to fit in and how they ought to construe the world around them.

The group will use storytelling (gossip) to maintain the integrity of the group so clues about the content of the mediating narrative can be garnered from the stories people share. Furthermore, the number of stories, the frequency with which they are shared and the degree of consistency in their implicit meaning provides a good indicator of the cohesion of group identity.

The ancestry of the idea

The concept of mediating structures has long been found in political theory. In their 1977 paper, Berger and Neuhaus reinvigorated the concept to criticise contemporaries who they felt saw society simply as a dichotomy of individual and state.

For Berger and Neuhaus, this was a dangerous over-simplification because it meant politicians ignored the importance of mediating structures in people’s lives. For them, a mediating structure was an institution that stood between the private individual and the state. Things like churches, families, charities, voluntary associations and companies.

Their argument was that approaching politics as the interplay between state and individual, had created a state that was seen as impersonal, unresponsive and interfering. In their view, the state had become increasingly detached from the values and realities of individual life and as a result political leaders were becoming delegitimised.

Furthermore, the centralisation of power within the state had left individuals feeling powerless. The central state, they argued, was “typically alienating, that is, … not helpful in providing meaning and identity for individual existence”, instead it was “mediating structures [that] are the value-generating and value-maintaining agencies in society”[8].

It is our view, that an analogous point could be made about some large organisations. Where strong mediating groups don’t exist, the voice of the CEO is heard at the expense of more local leaders and managers are discouraged from challenging and balancing the story emanating from the centre. In these types of company, little space or credence is given to the mediating group and as a result meaningful leadership, clarity and coherence don’t develop at that level. The result is the same as described by Berger and Neuhaus, individual employees feel disengaged, disempowered and alienated from the company.

The process of aligning mediating narratives with a company story

Our view is that you can’t create engaged organisations unless, the leadership or management team of each mediating group has a conversation about what the company story means for them. This is one of those ‘simple, but hard’ tasks that organisations struggle to execute but it’s vital that the management team connect the themes of the company story to their narrative. The company story must be able to accommodate and explain the real pressures, experiences and opportunities in their area of the business.

It’s equally important that  management teams  are given the time and space to discuss and work through anomalies and areas of misalignment. There is a temptation to ignore inconvenient incompatibilities, but without a genuine conversation about the points of conflict, its impossible to integrate the two narrative frameworks. Indeed it’s a sign of success when  passions run high because it’s a sign that the management team are wrestling with the emotional alignment not just the rational.

Why aligning mediating narratives is critical from the perspective of strategic change

When companies align their mediating narratives with the company story, they consciously bridge the gap between the company and the individual. If the company story is well written, it is able to survive this transition without losing its integrity, clarity and meaningfulness, but in the process it becomes enriched by being connected to real experiences, real people and real customers.

The first benefit of focusing on mediating narratives is that it pulls different perspectives and different groups of protagonists into the same story. This promotes collaboration because people can understand that while the company story is the common reference point for everyone, it does not mean the same thing everywhere. People can be alive to the need to exercise dexterity when moving between different groups or when working with other groups. They appreciate that there are occasions when they need to put away their Manchester United shirt, and start thinking as a football supporter.

The second benefit comes from teams having a greater appreciation of the implications of the company story for their area of the business. This helps to promote the alignment of decision making across the organisation and avoids the risk that the same team might come to two different decisions depending on whether the company story or their mediating narrative was primary in their minds at the time.

The more mediating narratives are discussed and the more they are used to frame experiences, the more likely it is that they will become integrated into employees’ personal narratives and hence affect their decision making. Again, referencing back to the work of Kahneman, the more we are exposed to something, the more familiar it feels, the easier we process it, the more ‘true’ it feels, the more confidence we place in it and the more instinctive the effect on our decision making and behaviour.

Investing in aligning mediating narratives should therefore increase the pace of decision making in organisations in the medium term. There should be less confusion and consternation about how initiatives from the centre are meant to be accommodated into existing plans. Less of the inertia within middle management that stems from people participating in the same conversation, but with different and misaligned group identities. Above all, senior leaders can aspire to empower dispersed decision making with the confidence that their  company story, albeit indirectly, is influencing the intuitive, instinctive assessments that are taking place on the front line of an organisation everyday[9].

The final benefit is that a company with well developed and aligned mediating narratives will create a stronger emotional connection to the new journey the business is on. People will have a better understanding of how the new strategy addresses the problems they face, how they can make a contribution and why the vision of global success is important and meaningful for them.

Why aligning mediating narratives is critical from the perspective of cultural change

It’s our view that most people’s primary motivation at work is to fit in[10]. They want to feel like they belong to the group. As a result, people will tend to copy the behaviour and opinions of those around them in order to be accepted.

The social neuroscientist, Matthew Lieberman argues that our brains have evolved to create a sense of ourselves that allows us to harmonise with the groups we are part of:

“the self exists primarily as a conduit to let… [the] social groups we are immersed in… supplement our natural impulses with socially derived impulses. The social world imparts a collection of beliefs about ourselves, about morality, and about what constitutes a worthwhile life. Because of how the self functions, we often cling to these beliefs as though they are unique ideas we came up with for ourselves — the products of our own inner voice. It is not enough for us to recognise what the group believes and values. We have to adopt the beliefs and values as our own if they are to guide our behaviour. In other words, just like the Trojan horse, much of what makes up our sense of self was snuck in from the outside… We might believe the self exists to help strengthen our resolve in the face of outside forces, but this theory of ‘who we are’ overlooks the way our brain uses those outside forces to construct and update the self.”[11]

In the context of cultural change then, creating and communicating strong mediating narratives makes it easier for employees to understand how to fit in. The evidence from social psychology is that people’s desire to be accepted makes their behaviour remarkably flexible and responsive[12]. If everyone is inclined to adopt group norms and opinions as their own, then behaviour change becomes much easier and more sustainable when the changing criteria for group membership are articulated and enforced through storytelling.

Well aligned mediating narratives promote cultural cohesion within organisations as they encourage greater consistency in social norms . This limits the scope for pockets of the organisation to develop ‘subversive’ cultures and for organisational chameleons — social climbers who change their behaviour and opinions as they jump between groups.

The implications of the concept of mediating narratives

The implications for senior leaders

One of the most useful aspects of the mediating narratives perspective is that it allows organisations to move away from the myth of omniscient, omnipotent leadership. The senior leaders of large organisations tend to significantly overestimate their ability to engage and motivate their employees[13]. Instead they need to be much more realistic about their ability to directly impact how their employees think and feel. In our experience, a remarkably large proportion of front line employees don’t even know the name of their CEO and on a day-to-day basis, the impact of the CEO pales into insignificance relative to someone’s immediate line manager.

To create a climate in which storytelling and mediating narratives can thrive, senior leaders should focus on creating a clear, simple and compelling company story. They must then communicate this consistently and repeatedly. In fact, the biggest challenge for storytelling leaders is to stay ‘on message’ for long enough for the message to filter through the organisation. Leaders who are used to dealing with complexity and moving at pace will often get bored saying the same old, simple story, long before the organisation has actually digested the message.

The other challenge for senior leaders is to develop an ear for great stories as they travel around the business. To successfully ground the company story in actual experience, the leader needs to find real stories from the front line that resonate with the key themes of the journey the organisation is on. This is important from a rational perspective because it gives substance and tangibility to the company story; but it is perhaps more important from an emotional perspective, because it demonstrates that the leader sees employees as the heroes of the company story and is genuinely interested and attentive to their experiences. This ofter runs counter to the style of a stereotypical leader who talks too much, observes too little and listens without genuine curiosity.

Beyond their role as communicators, senior leaders must also create a culture where their management teams have the confidence and space to challenge the company story. Focusing on cultivating strong and aligned mediating narratives won’t work unless managers have genuine scope to make their own decisions and to exercise their influence. In this respect, the leader should be less concerned with the outcome (whether any particular decision was exactly as they would have liked it), and instead focus on the process by creating the conditions where quality decision making and execution can take place. This will promote much more effective feedback through the organisation (both positive and negative) giving leaders a much better insight into what’s actually happening on the front line of the organisation.

Implications for middle managers

If the focus on mediating narratives makes the role of senior leaders apparently less important, then there is a corresponding increase in the expectations placed on middle managers.

They are the ones that must engage the individual employee in the sub-group and through that, engage them in the story of the wider company. From a storytelling perspective, middle managers must become the bridge between the global company and the individual employee.

However, this isn’t a case of middle managers subsuming or indoctrinating employees into the cult of the group. From the perspective of an individual employee, true engagement echoes the convergent/divergent balance of a flourishing organisation. The individual employee will flourish when they feel integrated and at home in the group , while also  being able to differentiate themselves by utilising their personal strengths, special aspects of their personality and character.

In order to create an engaged organisation, managers must be able to start conversations that make the company significant and meaningful for the individual and the individual significant and meaningful for the company. It is as much about storytelling ‘up’ the hierarchy as ‘down’.

Within their teams, it is the manager, not the senior leader, who bears the responsibility of giving people hope, meaning and purpose. To do this it’s also critically important middle managers are able to tell stories from the outside – in, stories that capture real customer experiences, expectations and benefits. The work of Adam Grant suggests that this is a huge source of motivation that remains untapped in most organisations[14].

Managers looking to use storytelling to create engagement, cannot accomplish this with a one-off communications meeting that localises the themes of a global story. It is an ongoing conversation that creates meaning by explaining how the team’s goals align with the company journey and which identifies the broader significance in individual instances of progress or change. In these conversations, managers should be looking to strike a balance between creating a sense of a longterm vision and keeping the team in the moment: focused on the immediate next step and building a sense of momentum. This is a time consuming, nebulous and open ended process, but in the words of psychologist Mihaly Csikzentmihayli:

“Nevertheless it is the only way to shape a group of people held together by organic solidarity, by common purpose. Such a group will be largely self-organising, and open to the future — an evolving organism rather than a closed system.”[15]

Often the requirements of this role will run counter to the traditional model of command-and-control managers. Traditionally the authority of managers has derived from knowing the answer to people’s questions. In the engaged organisation, influence often stems instead from asking the right questions: questions that prompt new insights, reflection or change. This requires management teams to be much more comfortable with thinking openly and in conversation. It requires them to be more comfortable with periods of ambiguity before decisions are taken. In these instances, managers should use storytelling to give colleagues what Jonathan Gottschall calls a “flight simulator for the mind”, that is a space for people to explore, and speculate in a way that leaves them better prepared for reality.

Implications for internal communications departments

There’s an element of truth in the criticism that internal communications departments have traditionally seen themselves as mouthpieces for CEOs and senior leaders. In reality, while helping to create a company story can be a challenging and occasionally politically fraught task, the real battleground for engagement is in aligning mediating narratives. This is where internal communications teams ought to focus most of their time and effort. Rather than broadcasting polished leadership messages out from the centre, they have the opportunity to facilitate conversations within teams across the organisation. Doing this in a way that promotes both genuine conflict and disagreement, but which also results in alignment is a key skill.

As well as fostering conversation, internal communicators ought to take the lead identifying and sharing the stories from the front line that add richness and insight to the company story. Telling and framing a story in an inspiring and engaging way is a real skill and at least in the first instance, internal communications teams will need to create examples that managers and leaders can emulate.

Finally, internal communications teams must be prepared to hold people accountable to the data. Most organisations are now well versed in measuring employee engagement, but very few draw meaningful conclusions from the results and still fewer act on the results effectively. At present, even when the results come through and are broken down into sub-groups, no one is quite sure what has been measured, who’s responsible and what the appropriate response should be. One of the virtues of the mediating narrative perspective is that it creates areas of accountability within the organisation as well as a model for how to address and improve engagement.


At their best, company stories are simple, meaningful and compelling. They convey a coherent rational account of the organisation and its journey, but also something with emotional and social appeal. When compared to more traditional forms of internal communications, stories have a special capacity to accommodate complexity, different perspectives and change over time. The MacLoed Report was then right to recognise a ‘strategic narrative’ as a key enabler of employee engagement, but in itself a strategic narrative or company story is a necessary but not sufficient condition.

In our view, an organisation is engaged, when there is a strong correlation between the company story and the personal narratives of individual employees. In large organisations this cannot be achieved without recognising the importance of mediating narratives and without making conscious efforts to align these mediating narratives with both the company story and people’s experiences. Working through mediating narratives provides a way for the company story to become meaningful for individual employees by grounding the themes in real experiences, concerns and hopes for the future. It also creates a route for the stories of employees’ achievements, innovations or insights to have greater influence on senior leaders and greater impact as they are shared across the organisation. Mediating narratives are the key to getting through the marzipan layer that impedes organisational change and the bridge between leaders and employees that creates a truly engaged and flourishing organisation.


[1] For the purposes of this paper I have tried to maintain a distinction between a narrative and a story. I have used ‘narrative’ to refer to a mental model, framework or schema. In contrast, I have used ‘story’ to refer to the expression or communication of a narrative. In this context, a story necessarily over-simplifies a more complex underlying narrative.

[2] My contention is that every company has a strategic narrative (or narratives) — implicit mental frameworks that are used within that organisation and by its stakeholders to give meaning to the past, present and future of the organisation. The focus of the MacLeod report is on the benefit of deliberately shaping and communicating these narratives as stories. My suspicion is that engagement practitioners have latched on to the term ‘strategic narrative’ rather than company story because it gives the concept of business storytelling a veneer of respectability!

[3] We disagree with the McLeod report: a compelling vision statement isn’t in itself a strategic narrative/story, rather it’s the end of a such story.

[4] It’s clearly possible to tell company stories to external audiences, many companies do this and do this very proficiently, but for the purposes of this paper, we will consider company stories only as internal communications tools.

[5] We seem particularly susceptible to interpreting events as a story where a protagonist exercises their will on the world around them. This is the case even when there are no grounds for inferring such agency or causation; see for example the Heider Simmel illusion.

[6] For a fuller introduction to how our brains process fiction, why we invest in heroes and the physical impact this has on our heart rate, hormones etc see The Storytelling Animal by Jonathan Gottschall

[7] Levine, Prosser, Evans and Reicher (Personal and Social Psychology Bulletin 2005, 31) Identity and Emergency Intervention: How Group Membership and Inclusiveness of Group Boundaries Shape Helping Behaviour

[8] To Empower People: from State to Civil Society by Berger and Neuhaus (1996)

[9] A great litmus test of this is to create a fictitious scenario and to ask  “What would be the [name of company] way of dealing with this?” In aligned organisations, the answers are remarkably consistent.

[10] The motivation to earn money may be a bigger motivation to work, but once someone has joined a company (once they are ‘at work’), we believe the need to belong becomes more important to them and more influential on their behaviour than the financial motivation.

[11] Social by Matthew Lieberman (2013)

[12] See Zimbardo’s Stamford Prison Experiment as an example of how group identity influences individual behaviour.

[13] Why Frontline Employees Are Disengaged, by Michael Bazigos and Emily Caruso. McKinsey Quarterly March 2016

[14] See for example: How Customers Can Rally Your Troops; Adam Grant HBR June 2011

[15] Good Business: Leadership, Flow and the Making of Meaning by Mihaly Csikszentmihalyi


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