By Kate Bullinger, President and Emily Caruso, SVP
Much is unknown about the long-term impacts that the 2020 confluence of a global pandemic, racial justice movement, and economic crisis will have on every aspect of our lives. While there are many areas where a wait-and-see approach might be prudent, planning for the future of work is not one of them. This past year presented leaders with the biggest management challenges of their careers. And as the recent attack on American democracy have already demonstrated, 2021 will continue to test the values — and limitations — of leaders. One thing is clear: those who act swiftly and boldly will not only improve experiences for their employees, but the value of their businesses.
Through a national survey of US consumers and employees conducted by Weber Shandwick and KRC Research, conversations with futurists, subject matter experts and our clients, we’ve identified the five tensions executives must wrestle with as they reset and reinvent for what lies ahead.
Importantly, all five tensions are rooted in evolving employee and consumer expectations at a time when more is required from companies than ever before. Leaders will not be able to put off the hard work of deciding where on the continuum they fall because stakeholders are watching, waiting and prepared to hold them to account.
Tension #1: Shareholder vs. stakeholder capitalism
Many organizations are facing economic realities when resources to perform even core business activities are limited. Shareholders are uneasy and leadership teams are seeking new ways to generate profit in a marketplace that is forever changed.
At the same time, stakeholder capitalism has resurged. The disproportionate impact of COVID-19 on diverse communities, the racial justice movement and challenges being made to a free and fair election have contributed to the growing expectation that businesses serve not just the interests of investors, but of all stakeholders — employees, customers, suppliers and local communities. For example, in the wake of the violent uprising in Washington, intense scrutiny — from these stakeholders, as well as advocacy groups and the media — is causing many companies to review strategies for political giving and make decisions on whether to suspend or end these contributions. This is about more than corporate reputation. More than one third of those we surveyed would like businesses to play more of a leadership role in helping guide the nation through difficult times and 73% are influenced in their purchasing decisions by whether a company is making a positive contribution to society.
Against this backdrop, NOT investing in advancing diversity, equity and inclusion and other societal interests is a business risk in and of itself. Conversely, those companies affiliated with politicians and institutions standing in the way of a peaceful transfer of power are being called to account. Mere statements, token donations and temporary actions are being viewed for what they are: at best, good intentions and at worst, hollow brand building.
Instead and despite resource constraints, leaders must find the confidence and resources to tackle systemic discrimination and injustice in a sustained way, in the months and years ahead and ultimately when nobody is watching. These longer-term actions should include auditing and then addressing the systems, practices, and processes that hold back diverse populations and stand in the way of inclusion.
This is one tension where compromise is not advisable. In addition to influencing purchasing decisions (and beyond being the right thing to do), our data show that the upsides of stakeholder investment include improved recruitment, retention, and performance.
Tension #2: Leader-led vs. employee-led change
In times of crisis leaders often tighten the reins, turning to a trusted inner circle of advisors and consolidating decision-making. It’s an understandable reaction, particularly as businesses navigate largely uncharted territory, but it’s a style of leadership that has quickly become passé.
Indeed, recent events have ignited a bottom-up revolution. Workers are organized, passionate and vocal with the potential to be highly effective change agents, and they want a say. When leaders take the company in one direction and employees pull in another, it causes enormous strain that leaders must confront head on.
A simple example of meeting in the middle can be found in Starbucks’ decision to provide employees with apparel in support of the Black Lives Matter movement following an initial stance forbidding BLM symbols on uniforms. The move represented a compromise — the company was able to honor employees’ desire to stand for racial justice while ensuring the language used on the apparel was true to the intent of the movement and would not be divisive.
Tension #3: Employee safety vs. business performance
Employers receive high marks for the way they’ve prioritized their people in recent months. Sixty-nine percent of respondents in our survey feel their employer is putting worker safety over profit and three-fourths of those back at work say their employer has changed the way it works to lower the risk of infection.
But these measures have not come without cost. For some industries, protecting workers initially meant reducing hours or shutting down entirely with dramatic losses in profit. For blue collar companies, it has required record-level spending on collaborative technologies. Organizations of all kinds have experienced harder-to-quantify losses owing to a decline in the type of innovation that only in-person collaboration can produce, constrained sales and customer service models, and isolated employees who in some cases have been quick to disengage.
As employees come back, companies will spend billions reconfiguring spaces, adding protective equipment, designing new work processes and purchasing health check technologies.
To keep businesses profitable while protecting your people, flexibility is paramount. Employers like Salesforce and Discover are allowing employees to re-enter on their own timing and their own terms. Here too, the options are not mutually exclusive. A healthy workforce that feels cared for by its employer will intuitively drive better business performance.
Tension #4: Employee productivity and well-being vs. personal privacy
As the pandemic persists and access to and perception of the vaccine remains fraught, workers’ anxiety and uncertainty has been increasing, and employers are being called upon to play a larger role in supporting their people’s wellness.
The implications are two-fold, with employers taking on greater responsibility both for employees’ physical safety (going beyond gyms and healthy options in the cafeteria to better ventilated spaces, staggered schedules, temperature checks, elevator protocols, vaccination policies and more) and new responsibility for their people’s emotional and psychological resilience.
Yet what will be seen as fulfilling obligations to some will be seen as an infringement on employee privacy to others. Some employees don’t want their employers to have their personal medical data, don’t feel comfortable opening up about their mental health with a company-affiliated therapist or don’t want to participate in conversations with colleagues about race in the workplace. Many resent the controversial practice of remote monitoring. To them these types of interventions, in whatever spirit they’re intended, are crossing the line.
The reality is that employers will never be able to take increased responsibility for employee wellness without impinging on privacy to some extent. But being clear on the considerations and trade-offs that drove the decision-making process — as General Motors and Kaiser Permanente did when publishing their return to work handbooks — will go a long way in extending trust.
Tension #5: Digital centricity vs. human centricity
Technology trends that began before COVID-19 are being rapidly expedited. Companies are accelerating their digital transformations to account for the fact that more employees will work from home in the long-term and increasingly looking to automation and AI to complete routine tasks as workforces shrink in size. They are taking every business process and customer touchpoint and actively designing its digital corollary.
While these measures can improve access and connection — and in many ways are saving the global economy — they also challenge us to find ways to guard against the impersonality of a more virtual and more mechanized world.
The increasingly popular shift to long-term work-from-home models will result in many positives but is likely to come at the expense of culture, which will have to be actively nurtured in new ways. Majority-remote companies such as GitHub might serve as a blueprint for how to navigate this type of hybrid model.
Conclusion
Expectations about the role businesses should play in society and vis a vis their people are evolving minute-to-minute. Now is the time to think about what these expectations mean for the future of business and the new world of work. For many leaders, this is the most definitive moment of their careers — they must carefully weigh competing forces and interests and take a stand.
Those who are most successful will stay closely connected to their stakeholders, encouraging input and debate through the decision-making process. They will commit to a test and learn approach as they experiment with different solutions, and they will explain both the “how” and “why” behind their decisions so their constituents appreciate the complexity and understand the intent. Above all, successful leaders will ground their decisions in corporate purpose and values, staying true to who they are and honoring their commitments to those they serve.
United Minds, a Weber Shandwick consultancy dedicated to organizational transformation, harnesses the power of people to solve critical business challenges. Get in touch at: [email protected]
