On the heels of the global financial crisis in 2008, Ericsson Australia and New Zealand was in trouble. The company laid off workers just weeks before Christmas, and customers ranked the IT corporation behind its competitors on many key performance indicators. What’s more, all-staff surveys showed executives and employees alike were demotivated, with a widespread belief that the company’s leaders were ineffective communicators.

It was clear that radical change was called for, and CEO Jacquie Hey kicked off a three-year program to transform the organization’s culture. Her approach of choice: to deliberately develop her team’s corporate storytelling skills. Each member of the senior leadership team was required to attend two workshops on storytelling and integrate the learnings into their everyday practices.

The strategy became known as Fast Track 2012, with messaging and creative centered on five priorities connected to Ericsson’s strategic programs; it also featured animal characters innovating to fast track their success. The messaging was used consistently across all channels, externally and internally, from the intranet to events and customer-facing videos, and the results were far-reaching. In a single year, Ericsson saw significant improvement on each of the metrics tracked: customer satisfaction, employee engagement and leadership communication.

Ericsson knew then what many companies are just beginning to realize: Storytelling is one of the simplest – and arguably the single most powerful – tool a leader has at his or her disposal to effect change. Far too often, organizations overlook the most critical component of realizing change, and one of the most difficult to manage: employee behavior. Organizations themselves cannot change; it is the individuals within them who must. To achieve this, most change management models allow organizations to focus activities on business results by taking emotions into account.

To sell change to your employees, you need to be able to translate a foreign and intangible concept into something that is concrete enough for your employees to believe in and begin to accept. You must demonstrate a genuine desire to do something that seems impossible, and relate to personnel on a human level. That’s where storytelling comes in.

The best stories speak to our hearts and minds alike; in fact, storytelling evokes a strong neurological response. Neuroeconomist Paul Zak’s research indicates that our brains produce the stress hormone cortisol during the tense moments in a story, while happy moments – and character-driven narrative, in particular – release oxytocin, the feel-good chemical that promotes empathy and encourages cooperation. Other neurological research finds that a happy ending triggers our brain’s reward center to release dopamine, which makes us feel euphoria.

To generate these effects, storytellers the world over rely on dramatic arc, as defined by German playwright Gustav Freytag. The Freytag pyramid, as it is called, includes five parts:

  1. Exposition: Here, the storyteller presents the setting (time and place), characters (protagonist or hero and antagonist or villain), introduces the basic conflict and sets the mood of the story.
  2. Rising action: In this section of the arc, basic conflict is brewing, obstacles are revealed, and the reader is beginning to feel the rising tension associated with this conflict.
  3.  Climax: This is the turning point of the play, which effects a change – for better or worse – for the protagonist.
  4. Falling action: Here, the storyteller begins to resolve the conflict between the protagonist and the antagonist.
  5. Dénouement: In the resolution of the conflict, the storyteller draws all of the strands of the plot together and sometimes reveals a moral or lesson.

This importance of structure can’t be overstated. Zak’s neurological research found that stories that fail to follow Freytag’s classic dramatic arc -- no matter how outwardly happy or pleasant those stories may be -- elicit little if any emotional or chemical response and generate a corresponding lack of action. Researchers Keith Quesenberry and Michael Coolsen uncovered a related finding: commercials that tell a more complete story, using Freytag’s Pyramid specifically, are more popular.

Budweiser got it right with its popular 2015 Super Bowl commercial, Lost Dog -- a sequel to the brand’s 2014 hit Puppy Love – which in turn was a sequel to the heartwarming 2013 campaign, Clydesdale. In Lost Dog, that adorable puppy (exposition) goes missing (rising action) while trying to tag along with his best equine friend. He is threatened by a wolf (climax), only to be saved by a team of horses when he is in danger (falling action) and makes it safely home, where he and his best friend, the horse, are reunited with their owner (dénouement). The commercial was a hit with audiences and analysts alike.

The best storytellers have an innate understanding of how to shape narrative; among them are Steve Jobs, Sheryl Sandberg, Walt Disney and almost anyone who has given a TED Talk. In fact, stories make up at least 65 percent of the content of the most popular TED Talks, researcher Carmine Gallo wrote in Forbes. More than 70 percent of Sheryl Sandberg’s famous 2010 TED talk, which launched the movement that convinced women around the world to “lean in,” consisted of stories, including her own struggles balancing working and motherhood and her feelings of guilt as she dropped her daughter off at preschool that very morning.

Companies around the world are arming their leaders with the power – and responsibility – to incorporate storytelling into their everyday work. P&G hired Hollywood movie directors to teach its senior executives how to lead better with storytelling; Nike has a number of senior executives who spend much of their time serving as corporate storytellers, inspiring employees with stories about innovation.

Change happens in the stories we tell each other, stories that go straight to the heart. Stories change our attitudes, beliefs, and behaviors; facts and analysis can persuade people, but they don’t inspire them to act. Storytelling can lead to faster, longer-lasting results. It engages employees who then become more receptive to change. These employees become happier, more productive members of their teams. By understanding the value they bring to the company, employees can – and will - focus on helping effect change.

Storytelling is a gift, and it’s one that can be cultivated. Take the time to start storytelling in your everyday life and take note of the change you see in your listeners. Start small – perhaps by responding with a story when someone asks how your day went – and practice until it becomes second nature. Through storytelling, you have the power to change the world around you.