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When Alan Mulally took over as CEO of Ford in 2006, the company was in dire straits. It had lost over $12 billion in the previous two years, and employee morale was low. One of the biggest challenges facing Mulally was the lack of psychological safety in the workplace.

Psychological safety refers to the belief that employees can take interpersonal risks without fear of negative consequences to their job security, status, or self-worth. It is essential to a healthy and productive work environment that fosters creativity, collaboration, and innovation. When employees feel safe to express their ideas, voice their concerns, and take risks without fearing retribution, they are more likely to contribute to the organization's success.