7 Behaviours of Underperforming Agencies #6 - The Dangers of a Fixed Mindset

articles leadership mindset sales and business development Dec 08, 2022

In 1957, engineers Alfred Fielding and Marc Chavannes stuck
two plastic shower curtains together and passed them through a heat-sealing machine. They wanted to create a bubbly wallpaper to appeal to a new breed of US hipsters modernising their homes. 

It didn’t appeal: their wallpaper was a flop. 

But, undeterred by failure, they thought of other uses for their poppable plastic sheet… more than 400, in fact. 

Only one of their ideas - as greenhouse insulation - even made it off the drawing board.,  Finally, four years after invention, they realised its potential as a new kind of protective packaging. 

At the same time, IBM had just released its 1401 unit, the most popular computer model of the 1960s. But it was getting damaged in transit… until Bubble Wrap stepped in and revolutionised shipping. 

Today, the company that makes and sells Bubble Wrap, Sealed Air, is a Fortune 500 company with sales of $5.7B and 15,000 employees. 

The lesson? A mindset which is unafraid of failure will encourage success. 

And the good news? The fact you’re reading this is an indication that you share this mindset with Al and Marc: that you believe you can develop, learn, evolve, improve… grow. And you’re curious to try. Your mindset is not fixed, but open to growth. 

This is also fantastic news for your agency: as a fixed mindset puts limitations on more than your personal growth - but on your company’s as well. This is why it’s the sixth behaviour we often see in agencies that under-perform. 

Read on for why a fixed mindset hurts company culture as well as the bottom line… and how to address it.


Fixed vs. Growth Mindset

The concept of the fixed or growth mindset was conceived by psychologist
Carol Dweck in the noughties and describes two opposing attitudes to peoples’ ability, intelligence, creativity and talent. 

How many times have you heard someone say something along the lines of, ‘Oh, I tried it once, but I’ve no coordination. I’m useless at things like that.’

The assumption of natural ability, of a core talent, or being ‘bad’ or ‘good’ at this or that, is a fixed mindset. 

In contrast, the attitude that through continual learning, coaching and practising a person can develop their abilities, talent and intelligence, is described by Dweck as a growth mindset. Success comes not from ‘talent’ or luck, but from consistent effort and seeking to learn from challenges. 

In her 2006 study, she estimated that 40% of learners had a fixed mindset. (Please note that there are no statistics on the ratio within the general population). Of course, it’s likely that we can be ‘fixed’ in some areas, but not in others. 


But, we can look at our behaviours to determine whether we’re operating with a fixed or growth mindset… and the key determiner is our response to failure. As Henry Ford said: “Failure is simply the opportunity to begin again, this time more intelligently.” 

Dweck noted that those with fixed mindsets feared failure and would do anything to avoid it. To be exposed to it would erode core beliefs about themselves and their ‘strengths’. Moreover, if they felt they had ‘failed’ they would often blame others, or quit… and this revelation is at the core of the reasons why, when it comes to leadership, a fixed mindset is most definitely a dysfunctional one for your agency:


  1. If an agency leader fears failure, or the suggestion of it, they will do certain things which are catastrophic for growth in order to protect themselves from it
  2. In the event of problems and challenges, a fixed mindset leader will see these as threats of failure and look for someone to blame… creating a culture of fear.


Let’s dig deeper. What do leaders with a fixed mindset tend to do and what is the impact on the business?


Fixed is Broken

Leaders with a fixed mindset often operate from a place of seeming self-confidence - when in fact it’s a place of fear: they don’t want to be exposed as a ‘failure’. 


So they protect themselves by:


  • Appointing leaders who are less experienced than they are 
  • Avoiding accountability - they have no board, no FD, no advisors 
  • Avoid communities and networking within the same space. They feel they can do it better, and don't need help.
  • Avoiding coaching programmes which might ‘expose’ their weaknesses (rather than believe they could help develop them into strengths.)
  • Always believing they have the ‘right answer’ and so make (at least some) bad decisions. 


Even without such a fragile organisational ecosystem, problems and challenges are inevitable in any agency… but it’s the fixed mindset leader’s response to them which stifles business growth. 

Instead of viewing things that go wrong as challenges to overcome, they see the fact that the problem exists at all as a failure: so they lash out, blame others - even firing the ‘culprits’… 

Bear in mind that a toxic corporate culture is by far the strongest predictor of industry-adjusted churn and is 10 times more important than pay in predicting turnover. A recent study found that the average cost of losing an employee is a staggering 33% of their annual salary,  so you’ve lost more than time… you’ve lost funds for your bottom line. 

The fixed-mindset’s finger-pointing breeds this exact toxicity - a culture of fear, where team members are scared to take risks or innovate; where mistakes are viewed as incompetence rather than learning opportunities. It can even lead to a workplace where lying becomes commonplace in efforts to avoid being called out for ‘getting it wrong’.


In contrast, leaders with a growth mindset:


  • See opportunities, even in crisis situations. They inspire clarity rather than incite panic in their response to them
  • Motivate teams to try new things as the outcome will not be labelled ‘an error’, but ‘an attempt’
  • Use feedback to construct teams’ development and evolution 
  • Develop systems for accountability which drive the business forward.


Leading on Learning

Leaders with a growth mindset know that they have to develop and grow alongside their business. The skills needed as an entrepreneur or lead in a start-up change as the company scales: diligent, independent learning and reading, peer support, or more structured coaching programmes are needed to get these new skills. 

92% of small business owners agree that mentors have a direct impact on their growth and the chances for their businesses to survive… leaders (with a fixed mindset) who cannot take on this personal and professional development may well place their business at risk as a result. 

Coaching programs are proven to have tangible benefits for larger businesses too. 

One Fortune 500 Company saw a 788% return on investment from executive coaching. This is backed up by a further study of Fortune 500 Companies, that tells us that company investment in Executive Coaching realised an average ROI of almost six times the cost of the coaching.


Fixing the Fixed

If you want to grow your digital agency you need to dismantle any mindset that assumes you - and you alone - hold all the answers, or that treats challenges as failures and fears them. Instead, build a team of problem-solvers that hold you, and each other, accountable. 

If you think your agency is at risk due to your mindset:


  • Run 360 reviews of yourself, with the team, regularly
  • Find a community centred around support and personal growth
  • Get a coach, NED, advisor or mentor
  • Create a culture of positive challenge and failure within your agency (if Google can do it, so can you)
  • Create a board, bring in an external FD
  • Build in accountability - create a board 


These steps are not quick, nor easy, but they’ll support you to find flex in your mindset. 

And if you don’t… aside from the toxic culture, employee churn and stunted growth you’ll expose yourself to, remember you're competing with others who approach things differently, and who will capitalise on your blinkered thinking.


Mindset Matters

When it comes to a standoff between a mindset which is fixed and one with plasticity, there will be only one winner: as 19th century politics reminds us. 

In 1871 liberal MP, Sir John Lubbock, had a problem. 

So fixed was the wealthy class’s mindset that the working classes were, in fact, work-shy, he knew that parliament would never pass a bill that gave workers more freedoms. Such as regular, mandated holidays. 

Instead of trying to change their minds, he manipulated their blinkered prejudice to his advantage. 

Rather than ask for holidays for workers, he asked for designated national holidays for the country’s banks. As many of the MPs were bankers, they agreed this was a good idea. Banks need holidays to get their books in order. It made sense to do this across the country at the same time. The bill passed with ease. 

But Lubbock knew: if all banks were closed, no formal business could be done. A day off for everyone was inevitable. 

Flexible thinking trumped fixed: Lubbock called it his greatest political achievement. And the UK still enjoys eight Bank Holidays a year thanks to his growth mindset. 

 If you need support or coaching to acquire the skills to scale your agency, or a peer group to address any element of your thinking, sign up to a GYDA Mastermind Taster Day. In person or online, experience the momentum our coaching programmes can give to your agency’s growth.