Nobody takes the class clown seriously. But that doesn’t mean you need to be serious all the time to be an effective leader. In fact, that will make you less effective. Left unchecked, seriousness creates anxiety and makes it harder for you, and the people you lead, to work effectively.

In family systems theory, Edwin Friedman emphasizes the importance of using humor to keep things loose as an antidote for anxiety. In A Failure of Nerve, Friedman writes about the importance of managing anxiety, your own and that of those around you. The effect of humor is to keep things less anxious. In doing so, it helps everyone. He writes: “The principles illustrated here have to do, among other things, with injecting humor and keeping things loose. The looser your presence is, the looser everyone’s relationship will be with you and one another.” (pg. 256).

You might be thinking, “I don’t want a loose relationship with people I lead. I want them to take me seriously.” Used appropriately, humor will not diminish that. Here are four ways it can help you.

Humor builds trust.

When you laugh, you release oxytocin. And, as I wrote previously, oxytocin builds trust, which is your most important asset as a leader. What’s surprising is that humor doesn’t just build people’s trust in you as a leader, it also builds trust among team members. That’s because the humor, and therefore the oxytocin, has the effect of building trust with anyone you come in contact with during the burst of oxytocin. In one study, people who watched a funny video clip were 30% more likely to reveal personal information to a stranger than people who watched a neutral video clip.

This goes back to Friedman’s point about keeping things loose. Humor not only builds trust, but it helps teams bond in important ways.

Humor supports innovation.

In his book, Little Bets: How Breakthrough Ideas Emerge from Little Discoveries, author Peter Sims shows that humor is critical to innovation. According to Sims, a playful and humorous environment is most critical for innovation when ideas are in their infancy because that’s when they are most vulnerable to getting killed. Game-changing ideas are much less likely to survive in a super-serious environment because you will err on the side of caution. Humor loosens things up so you are less afraid to go with a new idea.

Humor promotes more effective learning.

When you laugh, you also release dopamine, which aids in memory and information processing. When you are trying to get a point across that you want people to remember, make sure to inject some humor. This is true in a workshop, staff meeting, sermon or even an informal setting. Humor will make what you say more memorable.

Humor improves negotiations.

Researchers Karen O’Quinn and Joel Aronoff set up a study where participants negotiated the price of a piece of art. They found that when sellers threw in the playful line, “…and I’ll throw in my pet frog,” with their final offer, participants granted 18% more in concessions than did the control group. Another study found that sending an inoffensive, funny cartoon to someone during a sales negotiation generated 15% more in profits. It’s believed that in both these examples, the use of humor helps to develop trust, which leads to better outcomes.

Two notes of caution.

By now you should be convinced of the benefits of humor for you as a leader. However, I need to say two things, which may be obvious. One, make sure the humor is appropriate. An offensive or demeaning joke will have exactly the opposite effect. It will destroy trust and make the atmosphere more anxious. Two, don’t use humor to manipulate. It’s not a technique to get what you want, but to build more trusting, more effective relationships.

So lighten up. It will improve just about everything you do as a leader. You might even have fun.