CBT Model Explained by My Counselling Site
I used to have this affliction where I would make mountains out of molehills – whether the news was good or bad, I would hyperbolize and dream it into Never Never Land. For instance, someone could approach me after I gave a talk and say, “That was interesting,” in that “I question the usefulness of your information” kind of way and I would go from the receipt of potentially banal or at the very most slightly negative feedback to “OMG, I should never speak in public again. I have no idea what I’m talking about” in zero to 30 seconds. Then I’d stay in that awful spiral for hours…sometimes even days.
Similarly, I could take good news and start to spiral upwards. Even the smallest possibility meant that it was a done deal and I could start celebrating. Of course the crash of things falling through threw me in an extreme downward spiral. It was either WAY up or WAY down for me.
Until I found Cognitive Behavioral Therapy. Unlike many other forms of therapy, CBT is incredibly goal-oriented and focused. And there are simple exercises that the recipient performs over and over again to re-wire the way she reacts to events. Over a series of lessons and subsequent practice, I learnt to stop the spiral before it happened. Now I can get truly negative feedback and stop to assess whether I can learn from it and how to respond in a way that isn’t defensive or futile. A person approaching me after a talk can even say, “You sucked. I learnt nothing,” and I will either engage them in conversation (ie. “You learnt nothing because you already know the material or you learnt nothing because you disagree?”) or take the comment in stride with overall feedback (ie. Overall feedback was positive, but this one person didn’t like it – can’t please everyone). It’s been an amazing transformation for me and given me the ability to stop and think realistically and strategically about news, feedback and events.
As I’m hearing the news about thousands and thousands of layoffs in multiple industries everyday due to the economic crisis/downturn/recession/depression/etc we are in, I think: “Wow, this economy sure could use a little CBT. We appear to be in a spiral.” And we are. And the spiral that happens on one level affects the next and, like a really powerful hurricane, seems to pick up speed as it moves down the line. What is happening appears to be the best example of what Reagan called ‘Trickle Down Economics‘ I’ve ever seen…or a really far-reaching version of Systems Theory. Nothing operates in a silo.
I put a call out on Twitter that stated:
Many people replied that this was a socialist attitude, but I really don’t think so. We got into this mess because of poor short-term thinking and the lack of early government intervention. Nobody wanted to intervene because things were booming – what a buzzkill – unfortunately, they were all warned that this would happen. The truth is…because of corporate structures (nobody is truly accountable when the bill is passed to the shareholders), short-term thinking (really pushed by the corporate structures that hold CEO’s accountable on a short-term quarterly basis, so quick win solutions win over long term thinking) and a lack of understanding of systems theory (which is really the basis of community – what we do affects others and vice versa), we are destined to dig ourselves into a deeper hole. The level we are at now and the speed at which we are still spiraling suggests that the Great Depression levels of unemployment and economic crisis aren’t ridiculous predictions. I tell you. I’m scared. And something needs to be done to stop the spiral.
There are all sorts of ways to cut costs in organizations. Certainly, employees are expensive. But there are serious downsides to mass layoffs:
- Reduces ‘surviving’ employee morale and productivity
- Customer retention falls off more when their contacts leave, especially after a layoff (and the general feeling of the trustworthiness of a brand drops, so Word of Mouth is bad), losing more sales
- There are significant indirect costs to laying off people (especially large numbers), which end up wiping out the short term savings.
There is a great article on BNet that links to several studies to back this up.
So, yes, layoffs are a great way to cut costs in the short term, but the long term costs of layoffs are not worth it…not to mention the toll that mass layoffs take on the overall economy when they are all too common. The community around a major company that lays off, say, 5,000 employees suffers too. The local restaurants see a drop in patrons. Theatres, ballet companies, art galleries and other entertainment starts to struggle to make ends meet. Local business, car sales, real estate and just about everyone else who makes a living in the local economy suffers. I was talking to the bar manager from Nova the other day and she told me, “People are still drinking, but tips are way down.” Still, she told me, “I’d rather my customers can pay their rent and tip me 5% rather than 15% and get thrown out on the street.” I wish everyone had her “we’re in it together” attitude.
So, then, what is the alternative? What would the economy learn from CBT? How do we stop the spiral and get more realistic and strategic about our reactions?
Here are some suggestions:
- Ask your workforce to take a small paycut instead of having to layoff a percentage. FedEx did it. They had the CEO take a 20% paycut, senior staff take a 7.5-10% paycut and the rest of the staff take a 5% paycut. This probably saved them more in the long run and they get to continue to provide good customer service so that sales don’t suffer more.
- Give each department a challenge to cut costs drastically without cutting talent, quality or customer service. Make it a contest where the department who cuts the most creatively (without compromising the quality or service) gets an extra holiday week once things get sunnier. Alternatively, you could say, “C’mon…you decide how to cut costs so we can all get through this.” and you’d have employees getting creative.
- Work with your customers to increase sales while helping them balance their budgets. They are feeling the economic squeeze, too. Maybe you drop some prices to return customers as a thanks for their loyalty. Create a referral program and give discount codes for people to offer to their friends and neighbors. This may work better with the ballet company, but you could offer ‘Economic Downturn Wednesdays” where you’d sell really inexpensive tickets so ppl could still afford to go out. You’d probably introduce many new people to your business.
There are probably dozens of great management articles out there on multiple ways to cut costs during tough times. What I do know is that we can’t keep dumping unemployed people into the abyss like this. Not without some serious ripple effects. We have to stop spiraling and start thinking longterm. And we are all in it together. All of us. If there ever was time for community, it’s now. It’s time for each of us to stop thinking about ourselves and start thinking about how we can work together to get through this time. It’s time to stop the spiral.
As one who has been cast into the abyss, I gotta say…Tara, I heart you.
That was interesting…
I think that this can also trickle outside the economy. I know a lot of people who would get out of the military and become VERY productive members of society. However, due to the current economic state, are staying in. I don’t know what I’d do if I had to live in the “real world”
Fantastic article!
I agree we are probably going into a depression. I’m not too worried about it, I’ve been preparing for years.
CBT would work really well on the economy just as works for individuals who have the courage and commitment to do the work.
What politician has the courage to try something different?
Ron Paul?
He has no mojo.
Even if he’s right (he probably is), nobody is going to act on it.
The key with CBT is NOT excluding things that might work, due to pre-existing beliefs.
For example, the Bush administration tried all sorts of crap to “fix” the economy… all sorts of Keynesiasm crap. It doesn’t appear to be working. Obama may be heading down that same road (solving a debt problem with more debt…). He has popular support, which is a tremendous boon, and may be the critical factor. Let’s hope.
But why not try some Von Mises, Austrian School economics? Pay the debt down. Let the banks fail. We’ll pick up the pieces and put it back together, better.
Historically, fiat money has *always* failed. Are we so different now? I suspect Cicero, if he by some magic means could resurrected, would say no, we’re not that different at all, and thinking we are is hubris. At some point, something’s going to give. I think it would be better to deal with it now, because if the politicians succeed in blowing another bubble, inflating the debt away, I really do fear what will happen in the following crash (there is *always* a crash after a bubble).
I also agree that layoffs are stupid, and I am a hardcore capitalist. I simply regard people as the most important capital of all, and that corporations have responsibilities to their employees, their communities and to society. Not just to their shareholders.
I think you a dead on about thinking through how we can change the reactions, the conversation and, thus, the reality. And I agree that there are huge social problem to be associated with layoffs — most notably since health insurance is tied to job it takes a broken system (health care) and bashes it with a hammer right when it is most needed.
So, I think we have to find other ways to keep employees:
* govt incentives to people who don’t layoff
* something like carbon credits — some kind of reward for folks who lower operating costs
* better structures for sharing (co-working is a good example)
I know those things aren’t going to fix the whole problem but keeping people employed seems very necessary right now.
Could you find a therapist for Greenspan?
“I found a flaw in the model that I perceived is the critical functioning structure that defines how the world works” http://is.gd/hnPe
Extremely timely post, Tara. I was just thinking today that we really ARE in a great depression, except this time it’s also national mental health crisis. I have never seen such general demoralization everywhere I look. People feel powerless and therefore hopeless. It’s like we’re collectively giving up rather than digging in for the long haul. I know it’s personally been getting to me with each and every customer we lose and every account I have to close. Almost to the point that I don’t want to check my email any more.
I think you outlined some great coping skills for buckling down and surviving over the long haul without going batshit crazy or falling into a deep dark depressing hole. THANK you.
How humorous that people replied with a tut-tut for ‘socialist’ thinking, as if that alone is somehow bad or an admonishment. The private profit/socialized losses that are tearing up the banking and auto industry handily demonstrate that no government purely follows any philosophy other than ‘what gets it done’. I do like the post, but that first line about the reply tweets is hilarious.
Companies that lay off on a percentage base are missing out on a huge opportunity to refocus and revitalize their business. Unfortunately, that’s the power of Wall Street at play. It’s even worse when these companies have tons of cash on the balance sheets. Microsoft is one example.
http://bit.ly/1OqOjZ
Hi Tara,
As you’ve identified, a key facet of CBT is in recognising and understanding the role our emotions have in determining our eventual behaviour.
Of interest may be an article which comments on a new book which investigates ‘emotional tagging’ in relation to decision-making theory. The article – by the UK Observer’s Management Editor Simon Caulkin – looks at some of the key events of the banking crisis in light of this idea.
The article is titled “We must decide to keep the red flag flying here” and can be found at: http://www.guardian.co.uk/business/2009/jan/25/fred-goodwin-rbs-simon-caulkin.
Firstly, it’s not an article about socialism.
Secondly, it seeks to highlight why more active group / communitarian processes might be of value – if recognised and adopted in the future – in helping management more effectively check the potential risks of significant decisions made via singular, emotion-based criteria; in effect, a version of the ‘corporate CBT’ you call for in your own post.
To supplement this, Fortune magazine just profiled nine major corporations who have not laid off employees. The more concrete examples, the better:
http://money.cnn.com/galleries/2009/fortune/0901/gallery.no_layoffs.fortune/index.html
A friend of mine in Silicon Valley is now down to 3-4 days/week, as her company is trying to avoid any more layoffs. She’s happy to keep her job, along with more freedom to do other things she never had time for before. This can be a win-win situation, after all.
Tara,
Great post! The CBT caught my attention first, b.c I work through the same issues: learning to redirect my thinking to stop reacting at current situations based on an emotion tied to a past experience. Hardest job I have ever held!
You move it into an excellent point. I keep hearing of a great “recession” but where are people feeling it? During the Great Depression and even during WWII / WWI, we felt it as a COMMUNITY. Since Vietnam, nothing is felt as a community. We are all out for ourselves. How many people who commented on this post are adopting a family whose out of work? Are you making meals for them? Is anyone out reaching to those in need?
Society’s economic disease means pulling together. We can’t just sit back on our couch, play on the web, and say woe as the country. Have you stopped shopping? Are you stocking up on can goods? Is there a ration? Are we carpooling more?
NO, American society is not pulling together. We aren’t feeling it together – only individually. As a veteran and now spouse of a military member, each time my spouse gets deployed – I feel the war. NO one else in my neighborhood does. The same with how the TWO wars are being fought, by the military only, the economic woes are only being fought by the ones loosing their jobs. Everyone else keeps “talking” about it, but how much are WE giving up for others to survive? How much are WE doing?