As the UK starts to plan on coming out of lockdown (as at May 2020), businesses have both an urgent necessity and a great opportunity to rethink how they interact with their customers and employees. Now is the time to respond to the different world of work and prepare, as much as possible, for the post-Covid new normal.
Every business is different and there will be a broad spectrum of degrees of change in this next phase: from radical transformation to simply introducing the minimum requirements in response to any new legislation. But let’s start with defining a few common drivers for change post-Covid:
- The need for physically-distanced customer and workplace interactions
- Customers’ reduced appetite for spending and a change in priorities
- Businesses that have survived but now have reduced financial resources.
Organisations will need to not only continue to deal with the immediate crisis but they need to simultaneously be thinking about the future landscape of work post-Covid. When faced with such an unprecedented crisis and nationwide ambiguity, the tendency might be to focus on cost-cutting, imposing greater control and operating in very short planning cycles. However, the more proactive leaders will use this time to also lay the foundations for a more resilient organisation that will thrive in the upturn.
When faced with such an unprecedented crisis and nationwide ambiguity, the tendency might be to focus on cost-cutting, imposing greater control and operating in very short planning cycles…
It can be difficult to know where to start… so based on our conversations with clients, we have put together a framework for thinking this through. We recommend that you focus on three major themes: the organisational, sociological and psychological and this blog now addresses each of these in turn.
1) Organisational – addressing issues today and for the future
Social distancing
Firms are currently focused on the short-term impact of how social distancing will affect the way they can deliver work and interact with their customers. However, Government legislation around social distancing and health & safety in the workplace will have an impact on both role and team design, as the need to minimise face-to-face interaction will have to be built into the ways we work.
It might also mean reprioritising technology investments, to ensure a faster installation of digitalised processes that enable more employees to work remotely.
The current situation has shown organisations that they can run reasonably effectively while allowing people to work from home. Commentators expect the level of remote working to stay above pre Covid-19 levels and this offers organisations a new opportunity to review how they use the office environment; perhaps repurposing space to be used less for regular work and more for team and customer engagement. It can also lead to redefining roles and teams to minimise the frequency of close-proximity interactions.
Customers’ appetite for spending
Analysts predict that customers’ appetite for spending will be radically reduced whilst our economy recovers. The Bank of England warns of the ‘sharpest recession’ on record and suggests that consumers will remain cautious even when lockdown restrictions are lifted (BBC article, 7 May). How customers prioritise this reduced spending capacity will require businesses to take a fundamental look at their existing customer proposition. For example, retailers with a physical presence will need to redefine the roles of the employee and the retail space in the customers’ experience.
Lower cost base
To create a more resilient and sustainable business, as well as needing an even stronger customer focus to continuously adapt to changing customer needs, organisations will also need to run on a significantly lower cost base. So businesses are starting to shift decision-making power to customer-led functions and roles, whilst also reducing costs by taking out layers of management which also enables decisions to be made lower down the organisation.
As I discussed in OE Cam’s recent journal ‘Fit for the future’, organisations under pressure often look at costs within their businesses, aiming to align the organisation around a tighter, more efficient operating model. However, if cost-cutting is done without due consideration, the organisation could lose the ability to deliver key activities, find that people with key skills have the left the business or the cuts have been too deep.
However, the more proactive leaders will use this time to also lay the foundations for a more resilient organisation that will thrive in the upturn…
2) Sociological – rebuilding social cohesion
Engaging employees and partners
The organisational element discussed above addresses the more tangible aspects of the firm, but organisations are also social entities, where people come together to deliver for a common purpose. With new social distancing and more remote ways of working, there will be fewer opportunities for genuine informal face-to-face interactions, which are critical in building social cohesion. Leaders will need to work even harder to maintain engagement with employees and partners, for example, reflecting on how they balance the business need for providing more context and enabling greater autonomy, with their personal propensity for greater control when dealing with uncertainty.
Furthermore, as we emerge from lockdown, it will be important for firms to adapt their narrative to explain why they are changing working practices and what that means for their employees and partners. Effectively communicating a compelling narrative is a useful tool for managers / leaders to engage employees in the new ways of working, and their role and required behaviour in delivering it.
Leaders will also have to become adept at understanding the levers they have to bring about behavioural change. One such lever available to them is the use of nudges i.e. a positive approach to reinforcement, and indirect suggestions, as ways to influence the behaviour and decision-making of groups or individuals.
Decision-making
In addition to building social cohesion, informal interactions have historically fuelled the spread of ideas, and allowed for more visceral challenge to decisions before they are finally made. So how decisions are made will also need revising to ensure quality decisions are still made. This is discussed further by my colleague Julie Brophy in her blog.
3) Psychological – looking after the individual
As employees return to the new post-lockdown ways of working, organisations need to consider individual psychological implications including ‘in group/out group formation’ and ‘survivor guilt’.
In groups / out groups
One approach being considered for bringing people back to work safely is to divide large teams into smaller units and for these to work in the office on a rotating basis.
A risk with this approach is the formation of strong bonds within these smaller groups – creating silos – rather than social cohesion across the whole team. The work of psychologist Henri Tajfel (1) showed just how quickly individuals can identify with a group and develop unconscious biases towards ‘outsiders’. My colleague Julie Brophy covers this in more detail in her article on The Furlough Fallout.
Survivor Syndrome
When employees return to work in an organisation where there have been job losses due to the Covid-19 crisis, they will feel a range of emotions. Initially they will feel relief that they have kept their job. However, this is likely to decline over time and be replaced by emotions such as mourning the loss of colleagues, feelings of reduced social support and guilt at surviving the job losses. In addition, without effective communication from their managers they may also fear the threat of further job cuts and hence experience a growing feeling of insecurity.
See Julie Brophy’s article for more information on the additional psychological factors that need to be addressed during change implementation.
Conclusion
As we’ve seen in this blog, when organisations develop plans to emerge from the lockdown, they need to take a balanced approach that addresses the organisational, sociological and psychological aspects for a more effective transition to a new way of working.
There is a lot to consider, but as a starting point we would suggest:
- Organisational – Redesign your operating model so that you are able to respond faster to changing customer needs, and can deliver at a lower, but sustainable, cost level
- Sociological – Develop a compelling new narrative to articulate the why and the what around the new ways of working, implement targeted nudges to enable behaviour change, and revise how decisions get made to make sure they remain effective
- Psychological – Anticipate the psychological stresses that might emerge from the new way of working, and mitigate through targeted action.
For more information, or to discuss virtual workshops that can help address the issues raised in this blog, please contact me at gary.ashton@oecam.com or watch our recent webinar here.
References
1. Tajfel, H (1970) “Experiments in intergroup discrimination“, Scientific American, Volume 223, pp 96 -102