Gallup Path to Business Performance makes an interesting read. Also visit Gallup Management Journal.

In George Bernard Shaw's Pygmalion, a sophisticated professor of phonetics bets his friend he can take a common flower girl and transform her into a lady. The theory behind the pygmalion effect is that people will act the way you treat them. In this piece, I would like to refer you to this website with a great deal of very useful information: http://www.accel-team.com/pygmalion/ and also the U of North Texas' Center for Study of Work Teams.

Going back to the basics - we could see that over the years the Hawthorne Effect (showing that you care and recognizing people leads to better performance), the Skinner studies ("operant conditioning," the idea that we behave the way we do because this kind of behavior has had certain consequences in the past), Maslow's Hierarchy Theory all have significant effect on organizational performance. Successful companies such Toyota that year after year turn out consistently good quality products have more than their technical know-how to thank for. Technical know-how alone would not make these stand-out and win the hearts and minds of the people.

I still remember my ex-boss that not only provided me with my first job but encouraged me to excel. Thanks to the trust and confidence he placed in me I was truly able to exceed my own expectations of myself and make significant contribution to the organization - while in the process I had a great feeling everyday I went to work. I believe that if every boss (supervisor/team leader/manager) were to be that way, our country will benefit greatly.

One word of caution is that there are always exceptions to the rule.