# The Psychology of Agency in Leadership and Organizational Progress How efficacy, optimism and imagination drive success in uncertain times - **Source:** [HBR IdeaCast](https://brifing.si/source/232a17e4-dc84-4158-9739-7f858c033d89) - **Published:** 2026-09-15 - **Topic:** [Leadership](https://brifing.si/c/leadership) - **Original article:** - **On Brifing:** https://brifing.si/s/c686b94f-1522-4574-bafd-e91c9f6d1282 ## Defining agency components Martin Seligman breaks agency into three psychological capabilities: efficacy (belief in achieving current goals), optimism (belief in future success), and imagination (envisioning nonexistent possibilities). His research shows these traits predict exemplary work in organizations. The US Army study tracking 900,000 personnel found 12% received exemplary work medals, strongly correlated with these traits. ## Military case study insights In a comprehensive study of 75,000 soldiers deployed to Iraq/Afghanistan, Seligman identified catastrophizers (those assuming worst outcomes) were twice as likely to develop PTSD. This parallels corporate environments where catastrophizing employees undermine team agency. The Army's psychological screening proved predictive of both exemplary performance and vulnerability to stress disorders. ## Hiring for organizational agency Data suggests hiring optimistic individuals with positive affect yields better outcomes. However, Seligman emphasizes training pessimists in optimism techniques is equally vital. His work with the Army developed interventions to build efficacy, optimism and imagination - transferable to corporate leadership development programs. ## The disputation technique Seligman advocates realistic disputation against catastrophic thinking. When negative thoughts arise (e.g. "I'm too old for this"), counter them with specific evidence ("I succeeded in similar situations"). This differs from superficial positivity by requiring factual arguments against pessimistic assumptions, building authentic optimism. ## AI's limitations on imagination Seligman's experiments with AI therapists revealed machines cannot perform abduction - leaping to best explanations beyond existing data. While AI excelled at coherence (fitting known patterns), it couldn't replicate human breakthroughs like Darwin's or Einstein's theories. This highlights imagination as uniquely human competitive advantage. ## Putting problems in perspective A practical technique involves analyzing situations through three lenses: worst-case (getting fired), best-case (getting promoted), and most likely (feedback on work). By preparing for the probable outcome (e.g. refining a budget), employees convert anxiety into productive action. This method reduces paralysis from catastrophic thinking. ## Leadership's agency paradox Effective leaders balance demonstrating personal agency with empowering others. Seligman notes the management tension between providing direction and cultivating team members' belief in their influence. Techniques like perspective-setting help distribute agency throughout organizational levels rather than concentrating it at the top. ## Cultural implications of agency Organizations with high collective agency exhibit greater innovation and resilience. Seligman's research suggests these cultures emerge from combining selective hiring (prioritizing optimism), targeted training (combating catastrophizing), and structural practices that encourage imaginative problem-solving at all levels. ## Measuring agency traits The Army's 100-item psychological assessment effectively predicted exemplary performance over five years. Three key markers emerged: high optimism, high positive emotion, and low negative emotion. Similar metrics could help corporations identify and develop high-agency talent during recruitment and promotion processes. ## From PTSD to growth Seligman's work shifted military focus from treating post-traumatic stress to fostering post-traumatic growth. This paradigm applies to business - reframing challenges as opportunities to build efficacy. Organizations can design experiences that stretch employees' capabilities while providing support to prevent helplessness. ## AI's role in agency development While AI cannot replicate human imagination, Seligman found it effective for scaling psychological interventions. His virtual counterpart delivered sound advice by processing his existing works. This suggests AI's potential as a force multiplier for agency-building when combined with human creativity and oversight. ## Sustainable progress framework Seligman's agency model offers a blueprint for organizational resilience: efficacy drives immediate action, optimism sustains long-term effort, and imagination creates breakthrough solutions. Leaders who systematically cultivate these traits position their organizations to thrive amid uncertainty rather than succumb to paralysis. ## Sources covering this story - https://hbr.org/podcast/2026/09/what-it-takes-to-make-progress-when-the-future-feels-out-of-control — --- _Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._