Have you ever known someone who’s “loyal to a fault?” We’ve all had that childhood friend or family member who would take our side no matter what. As kids horsing around on the playground, being loyal to fault could mean standing up for a friend or helping them get away with a minor infraction. But, in the world of business, loyalty to a fault can have widespread and disastrous implications. In fact, gone unchecked, it can tank an enterprise.

I’m talking here about toxic loyalty. It’s the type of loyalty that irrationally serves the ego, not the organization. And it can take many forms.

Employees who are undercompensated, unrewarded, pigeonholed, or even pressured to act immorally can be toxically loyal to their employers. They stay in a role to their own detriment, often because they feel emotionally tied to the brand, institution, or industry. Sometimes an individual manager or leader will use guilt, shame, or even toxic positivity to keep an employee shackled in place. Being called a “traitor” is such a pejorative that we’ll go to great lengths to prove our loyalty, even if doing so is irrational and detrimental to us.

People like Elizabeth Holmes of Theranos fame demanded absolute loyalty from those around her, or else. Now that the secret about Holmes and Theranos is out, it’s almost unbelievable that they fooled anyone. But Holmes’s maniacal insistence on allegiance went unnoticed for years before her house of cards fell, and I suspect there are many others like her employing toxic loyalty to hide their lies. Toxic loyalty keeps “dead on arrival” companies afloat.

TAKING ON THE OFFICE ‘SACRED COWS’

Unfortunately, toxic loyalty doesn’t just flow in one direction; it’s a two-way valve. Have you ever seen a manager or institution extend excessive, inexplicable loyalty to a specific employee or group of employees? The recipients of this kind of blind allegiance are sometimes referred to as “sacred cows,” people who are so revered that they’re deemed untouchable.

Sacred cows generally fall into three camps—they’ve been with the company forever, they played a significant role in some aspect of the organization’s success, or they’re a close friend or family member of someone high on the totem pole. When sacred cows start to exhibit negative behavior or make poor decisions, their loyal supporters ignore these issues or defend them. Sacred cows often contaminate otherwise healthy operations and harm good citizens in their orbit.

On several occasions, I was engaged to turn around companies after numerous other turnaround professionals had failed. Those that preceded me invariably and detrimentally relied on cost cutting, restructuring, and repositioning. They were so fixated on the external levers of business operations that they never met the people, understood the culture, or identified the true roots of the problem: sacred cows fueled by toxic loyalty.

It’s difficult to accept that your culture could be undermining your enterprise. As a result, my method of turning around companies—by engaging with the messiness of people and emotions—is often viewed as a last resort.

So, how do you combat toxic loyalty and neutralize sacred cows? Invest time in thoroughly understanding the organization’s culture and interpersonal dynamics. Leaders must carefully examine the behavior of employees and executives to identify toxic individuals and their ripple effects. Once you identify the problem people—those extending unfounded loyalty and those benefiting through sacred status—you must isolate them and insulate the healthy part of the organization, enabling it to continue functioning without being dragged down by drama.

I believe that all things happen with and through people, so when I am able to rehabilitate sacred cows, I proceed as described in this article entitled “Why Being Emotionally Intelligent Doesn’t Mean Putting Up with BS.”  There are times, though, where toxic loyalty blocks any path to rehabilitation. Because there is truly no room for sacred cows in business (especially where I live in Texas, where cows are brisket), all that can be done is to fire them and change the narrative.

CULTURES OF ACCOUNTABILITY AND TRANSPARENCY

Only a new culture that emphasizes accountability and transparency can break the bonds of toxic loyalty. Eliminate the sacred cows, implement new policies and procedures that encourage open communication and feedback, recognize and reward employees who exemplify the new culture, and create a zero-tolerance policy for the old ways of doing business. The unsung heroes will rise and the sacred cows’ loyal supporters will either leave or get with the program.

None of this is easy. Often the top executives responsible for steering the company in the right direction can impede progress by holding on too tightly to their loyalties. They have embraced the narrative that the sacred cows are quirky, yet harmless, or they’ve succumbed to sycophancy by protecting ill-meaning and ill-equipped individuals. In these cases, ego has eclipsed excellence. What these executives perceive as leniency toward quirky employees becomes the cause of dysfunction, turnover and, sometimes, disaster.

In The Lame Shall Enter First, a 1962 short story by controversial author Flannery O’Connor, the protagonist, Sheppard, demonstrates toxic loyalty toward a troubled young man named Rufus, who becomes the priority over Sheppard’s own struggling son, Norton. Sheppard’s misguided efforts to “fix” Rufus ultimately backfire, leading to Norton’s tragic death.

As a member of the inaugural class of Duke University’s Hart Leadership Program, I read the story in a seminar course called Leadership, Policy, and Change taught by the Program’s legendary founding director, Bruce L. Payne. I vividly recall the heated class discussion around Rufus, mostly because I was walloped by the other 73 students who vehemently disagreed with my stated position that “not everyone is good at heart.”

Later, when I asked Bruce to write me a law school recommendation letter, he actually included the incident in it. “For more than an hour, David maintained his position against all comers,” he wrote. “Neither angry attacks nor friendly persuasion could convince him that everyone is good at heart. . . . Yet, I was surprised by his inability to persuade others, even though, as I saw it, he was right about the story and insightful about the world.”

It’s been 37 years since then, and I’ve encountered many Sheppards and even more Rufuses. Sometimes I can persuade the Sheppards that they’ve got a Rufus on their hands before it’s too late, but I’m still surprised at how difficult it is every single time. The world is an entirely different place, but I’m afraid not much has changed. I’m still here doing my damndest to convince you that a true Rufus will lead to your demise. Are you listening yet?