In our Culture Economy Report 2021, we reflected on the challenges many SMEs faced during 2020 in terms of staying afloat in a time of economic upheaval and supporting their people and ensuring their physical and mental wellbeing.
We explored the idea that the changes many businesses had to make in the early days of lockdown – especially in terms of adapting to remote working – accelerated the evolution of working practices which pre-pandemic, came under the banner of the ‘Future of Work’.
In this post we summarise some of the ideas included in the Culture Economy Report and the results of research we undertook at the beginning of 2020 to understand how SME leaders and employees felt about 2020 and their thoughts about business recovery.
The importance of technology
It’s undeniable that technology has played a vital part in enabling businesses to pivot to new ways of working in the early days of the pandemic. If the transition to remote working was achieved most successfully by organisations with strong cultures, technology has been the enabler.
Before the COVID-19 crisis, the idea of remote working was in the air but not proceeding very far or fast. But the pandemic changed that, with tens of millions of people transitioning to working from home, essentially overnight, across a wide range of industries.
Microsoft’s CEO Satya Nadella captured perfectly one of the most significant impacts of the pandemic, when he declared that: “We have seen two years' worth of digital transformation in two months.” Indeed, the crisis has arguably fast-forwarded the ‘future of work’ by five or ten years.
During the research phase of writing the 2021 Culture Economy Report, we spoke to Amichai Ben David of Digital Nomad World, a community website dedicated to supporting people who want to combine work with travelling and living abroad to understand his view about technology. He told us:
“With today’s high speed internet connection, wide variety of project management software and advanced security systems, the vast majority of companies can easily transform their work into a more flexible environment.”
“Moreover, many companies already do work remotely in this sense, but from an office on a 9am to 5pm schedule. Acknowledging this fact would allow for a more flexible environment, which will in turn give the employees more control over their personal life and directly improve their satisfaction.”
Cultural reset and recovery
In a report by McKinsey, the author writes: “2021 will be the year of transition. Barring any unexpected catastrophes, individuals, businesses, and society can start to look forward to shaping their futures rather than just grinding through the present.”
From an employee perspective, many will have had significantly different experiences in terms of the way they have been treated by their employers during the crisis. For those people who have been treated well by the business leaders who have demonstrated kindness and compassion, it will be long remembered.
In equal measure, those who don’t believe they have been treated fairly or with kindness, will perhaps be now seeing their employers in an unfavourable light.
The impact on trust
Employees who feel aggrieved about the way they were treated during the pandemic will long remember their experiences and this is very likely to have an impact on trust in leadership and the perception of a company’s organisational management.
A lack of trust could affect a company’s ability to retain employees, creating a negative culture with poor morale. Given the fact the candidates researching new positions and the companies who are offering them now have considerable insight into cultures via websites such as Glassdoor, some companies could struggle with recruitment.
Turning to the research we conducted at the beginning of 2021, we found that 27% of the SME employees polled said they have left their job as a result of toxic cultures. And almost a quarter 24% said they would be willing to pursue a different career in a different industry.
It will be interesting to see how employees’ view their leaders’ organisations in another 12 months’ time, in a year when businesses will have been working hard to recover, and if there have been correlations between retention and the way in which people reflect on their experience during the pandemic.
A new approach to employee benefits
In a recent article about the evolution of employee reward and recognition driven by the crisis and the need for new approaches to leadership that puts peoples’ wellbeing first, Robert Ordever, MD of workplace culture expert, O.C. Tanner Europe writes, “organisations that used to provide transient perks are now recognising that more meaningful support is now needed, with 2021 being about providing genuine and tailored rewards. This might include home office equipment and furniture, a mental health support line or new flexible working arrangements.”
Robert Ordever adds that financial wellbeing and support is just as important, with many people finding themselves in difficult situations due to the pandemic fallout. “Offering financial education, support and advice will be well-received by many employees, together with finance schemes such as salary sacrifice loans."
‘All eyes on HR’
So, what does the future of work and the adoption of new working practises mean for HR and people managers?
David Green, an expert in people analytics, made an interesting point in his recent article ‘All eyes on HR’: Predictions for HR in 2021, saying that the pandemic has thrust the human resources function into the spotlight. Citing research by Deloitte (and others), Green argues that as many employees have been in vulnerable and precarious positions, the need for an increased focus on HR and people management has come.
Of course, not all businesses employ dedicated HR professionals and in some smaller companies this area of business management may fall to someone who shares people management with other duties and responsibilities.
Nevertheless, companies need HR functions and support from professionals like they have never needed them before. They will play a key role in providing support as we transition to new ways of working and create workplaces in which fairness and wellbeing are guiding principles at the centre of company cultures.