Our businesses are continuously changing. It’s the way of the world now. And I want to share something really wonderful that has enhanced our company’s performance. It’s the concept of psychological ownership.

Psychological ownership is something I have been researching intensely for my next book. And I’m all in.

By definition, psychological ownership theory (Pierce et al., 2003) suggests that individuals experience a cognitive-affective state, i.e., psychological ownership, in their interactions with objects when the individuals feel as though the target object is “theirs”.

“But wait, this is my company!”

I think when entrepreneurs and small business owners start our companies, we think about how we’ll implement our ideas, create our impact, and crystalize our mission. Great! But it’s incredibly important to remember that a great leader of a company leads a great team to make it efficiently fall into place and create that envisioned impact. So hire a phenomenal team, give them stake in the game, look out!

When I started, yes, it was just me and at one point I definitely thought I could do it all. I had to. It was, after all, my company. Maybe I’d hire an assistant. I did. When she began to serve in more widespread capacities, she was an obvious fit to become the company president. Then over the years she brought on wonderful employees, who then introduced others. And, we still offer the team new responsibilities when they ask or if we see a fit. We hire new members as needed. 

What I’m getting at, is that there is a healthy amount of ego that needs to be removed to make your company everything it can be. No pigeonholing into hierarchies here. If there is a big brain to tap into for innovations, we want in.

Having a team not only aligned in your mission, but adding to it with as much loyalty as you have, is a game changer. Your missions quickly become realized in a more efficient way. 

Yes, you are still the leader. Moreover, you are the steward. 

And that is more important than ruling your roost. A steward leads through offering ownership to the rest of the team. Why? Because when you do, your entire team will be just as dedicated to your business as you are. It’s invaluable.
What gives your team members a sense of ownership?

So this all sounds good, right? Let’s get to some actionable steps for you to implement psychological ownership in your business.

How to establish employee ownership via physiological ownership – and give your employees stake in the game.

• Reciprocity – There is a great amount of reciprocity expected here, no doubt. You must exchange your resources in order to succeed, and offer a high amount of trust and communication.

• Autonomy – No micromanaging! At the same time, this doesn’t negate the importance of communicating and utilizing a project management platform for updates. We like to have in person meetings too to make sure we’re getting that human time in as well. Having a status update is enough to keep your finger on the pulse of the project. But if you get too involved, the idea of ownership will lessen, and your team members will actively or subconsciously begin expecting nudges from you to finish the project.
• Creative license and voice – Similar to autonomy, giving someone agency over their creative ideas they are bringing to the table will empower them to take more responsibility over the ideas, and the outcomes. As a byproduct of feeling ownership in the company and in their jobs, employees feel more accomplished. Something to consider considering The Great Resignation is still in action.

What can you do to have your colleagues take a larger part of ownership in your company?

If you want to give your team a sense of ownership, ensure that they are participating in the creation of something.If you simply share your idea to have your team roll with, they may embrace it, but likely won’t feel ownership. Conversely, if you approach your team requesting their ideas and input, the increased engagement alone will get everyone excited.

The benefits of psychological ownership: I know this all sounds very, well, “nice”. And it is. The facts are however, that there are studies and data that back up how employee ownership positively affects your business. Psychological ownership:

• Enhances company performance
• Creates better company stability and employee retainment
• Has a closer relation between what’s being produced and revenue outcome
• Opens up the doors for innovation that may not yet be explored
• Increased motivation
• Company stewardship
• Loyalty
• Fosters productivity – efficiently
• Creates the desire to belong or make idea work for the betterment of the company

When your team is not only aligned in your mission, but provides additional value to it with as much loyalty as you have, it’s a game changer, an “ah ha!” moment. Your missions become realized in a more efficient way. So you can focus on the next awesome offering for your clients and the world. 

-Mike