How mindsets can make all the difference

In challenging times, it’s vital that organisations understand the potential of mindsets to limit or catalyse success


These are uncharted times. Organisations and individuals have had to quickly learn new habits and adapt to new ways of working. Homes have become workspaces, and boundaries between personal life and the office have been crushed.

For everyone, the stress of the crisis has been exhausting. But for some, it’s also been an opportunity to learn new skills, new ways of interacting with co-workers, or more simply, about themselves – what they really value in their lives and how they can maintain productivity when feeling so disconnected from colleagues and teams.

How have some people been able to embrace the learning opportunities brought on by recent events? Could their mindset make a difference?

Watch: Aneeta Rattan, Herminia Ibarra and other world-leading experts explore why mindsets matter at work, how they define leadership and why a growth mindset at an organisational level will define future success.

The power of a growth mindset

Mindsets are people’s fundamental beliefs about whether abilities, talents, skills and personality can change. Some people believe that they are fixed. Others believe they are more malleable.

Decades of research, including our own, has found that mindsets shape people’s responses to challenges and difficulty. They drive who sees and seeks learning opportunities.

It’s imperative that organisations understand their people’s mindsets because our ability to do our work and to do it well is shaped by the mindsets we hold. Under conditions of stress and challenge and difficulty, mindsets differentiate people’s responses.

Evidence shows that individuals with a growth mindset experience challenge and stress just as much as those who hold a fixed mindset, but in response to those feelings they put in greater effort (rather than withdrawing effort), persist more (rather than less), and seek to learn from the experience (rather than just moving on). Because they view failure as a learning opportunity, it seems they can operate with more resilience, creativity and agility in a fast-paced, ever-changing world.

On the other hand, those operating with a fixed mindset see effort as a sign that they lack ability – so when things get tough they withdraw. They want to show off their abilities, which often means sticking to activities they have already mastered or are confident about doing well, rather than failing and risking embarrassment. 

In the case of Microsoft, a fixed mindset was seen as limiting organisational success due to internal fighting, stasis and inertia. That’s why the company transitioned to a growth mindset culture, in order to foster exploration, innovation, and customer-focus. 

But mindsets are complicated. We don’t just hold our own mindset. When we’re at work, we observe the mindsets of others, particularly our managers. They too can shape our experiences and our responses to different challenges. If you can see that your managers’ views and mindset are fixed, and they don’t encourage any kind of learning, you’ll respond by exhibiting the behaviors they value.

Organisational mindsets 

This is the power of mindsets. “They are as deeply entrenched as our political beliefs or our religious beliefs. They really shape how we see things; how we interpret things and respond to things. They are the filter through which we understand the world,” explains Paul O’ Keefe, Assistant Professor at Singapore-based Yale-NUS College.

And what businesses must understand, emphasises Mary Murphy, Professor of Psychological and Brain Sciences at Indiana University, is that they exist at an individual level but also an organisational level. “Only when organisations understand what their mindset messaging is can they start to make changes, and begin the journey of developing a full growth mindset culture.”

Susan Ashford, the Michael and Susan Jandernoa Professors of Management and Organisations at the Ross School of Business at the University of Michigan, warns organisations to be careful about sending contradictory signals to their people.

“If they’re sending signals saying ‘we only select the best’; that only performance results matter, people will fall in line, and will demonstrate a performance-prove mindset, rather than a growth mindset – and this will have costs down the line in terms of anxiety and performance.

“The organisation won’t get what it wants, which is high performance and people who are growing and developing their leadership capabilities, because – ironically  – their people are hampered by concerns about performance.”

On the other hand, Professor Murphy lists the benefits for companies that are able to successfully endorse a growth mindset at an organisational level. “These companies are more agile in the face of change and transformation. Their employees trust them more and they are more committed.

“Not only that, but a growth mindset is good for everyone, but particularly good for women and people of colour. Why? Growth mindsets tell us anyone can be successful as long as you put in the right effort, persist through challenges, seek help and find the new strategy regardless of identity background.”

Microsoft: Instilling a growth mindset

When Satya Nadella took over as CEO of Microsoft in 2014, he inherited a firm fading into irrelevance. Earlier that year he had read the bestselling Mindset: The New Psychology of Success by Stanford psychologist Carol Dweck. He adapted the ideas in the book to encourage employees to shift from Microsoft’s historical “know-it-all” culture to a “learn-it-all” curiosity.

Professor Ibarra and Dr Rattan are co-authors with Anna Johnston of an awardwinning case study, available on the London Business School Case Collection, which offers a rich background on Nadella’s challenges and context, as well as how he and his leadership team executed their enormous culture change effort.

Professor Ibarra and Dr Rattan teach key insights from this case on degree programmes and Executive Education courses at LBS.

Aneeta Rattan is Associate Professor of Organisational Behaviour at London Business School. She is the academic co-director of the new LGBTQ+ Executive Leadership programme, the first of its kind in the UK. There are still a few remaining places in the first cohort, programme start date 28 June. Herminia Ibarra is Charles Handy Professor of Organisational Behaviour at London Business School.