"Cultural entropy" costs retailers an estimated £10.8 billion annually, making up almost a tenth of the £122 billion lost annually across UK industries due to workplace fear, amounting to 5 per cent of the nation’s GDP, states a recent report.
According to research by Katharine Williams, founder of Neema, in terms of economic loss, the retail sector ranks fifth, sitting below healthcare, manufacturing, real estate and construction and financial services.
The rise of e-commerce, automation in supply chains, and data-driven decision-making has transformed operational models.
This shift has increased pressure on leadership to adapt quickly, often leading to fear-based behaviours amplified by job security concerns, evolving customer expectations, and the challenge of balancing technological innovation with workforce retention, states the report.
Defined by the Barrett Values Centre, cultural entropy is a measure of unproductive and fear-based leadership behaviours such as blame, bureaucracy, and mistrust, which divert critical resources and energy away from productive activities, hampering revenue growth and impacting employee engagement across various sectors.
In terms of cultural entropy, by comparison to other sectors retail performs quite well with an entropy score of 17 per cent, sitting below sectors such as utilities and healthcare which have greater levels of fear-based behaviours.
The study finds that although good leaders don’t intentionally foster fear-based cultures, many unwittingly do. Despite over 50 per cent of UK organisations offering leadership development programmes, between 15 per cent and 22 per cent of all leadership behaviour remains fear-based.
This is because, like all humans, 90-95 per cent of a leader’s thoughts and behaviours are driven by their subconscious processing—which is often fear-based and shaped by emotional triggers, habits, and learned responses.
As a result, even highly experienced, well-intentioned leaders operate with fully deliberate, intentional thought only 5-10 per cent of the time, making them susceptible to automatic responses that may not align with either their own or the company’s values.
Williams said, “I see this as positive news for CEOs within retail. For those who have been left dissatisfied by the results of costly, time-intensive cultural interventions and leadership development programmes, there is a bright light at the end of the tunnel.
"Cultural Entropy costs will drastically reduce as leaders increase awareness of the subconscious patterns and habits that fuel fear-based leadership behaviours.
"As a coach, I use neuroscience-backed techniques, honed intuition, and rigorous diagnostics to help clients access and integrate what’s hidden in their subconscious. Integrating the subconscious with the conscious makes the invisible, visible – and what you can see you can address. At Neema, we call this ‘Integrated Leadership’.”
