Each month, Mercer brings together in-house experts, employee advocates and external thought leaders for an online discussion of the most pressing issues. The program is called #MercerChats and takes place entirely on Twitter, where individuals around the world engage with Mercer’s intellectual capital and other leading thought leadership to share insights and discuss the best solutions to help organizations thrive. Below is a summary of our October 2020 tweet chat, highlighting some of the key themes discussed and insights shared.
Whether you’re a sandwich shop or a Fortune 500 (or a Fortune 500 sandwich shop, for that matter), every business will know lean years. In our cyclical global economy, it’s inevitable that at some point either economic forces or some other factors will threaten your business and necessitate the proverbial tightening of the belt. So if we can take it on faith that hard times are as certain as death and taxes, then there’s no excuse for leaders to be unprepared to face these challenges and help navigate their organizations through the turmoil and continue to thrive on the other side.
But that doesn’t mean that market downturns will be painless. From downsizing to right-shoring to restructuring, there are human costs to every organizational decision. This has never been more apparent than it is today, when nearly every global firm is looking to navigate the flurry of changes that have come with a global pandemic, the overnight shift to remote work, and an economic downturn unlike any seen in decades. Leaders around the world are being forced to make difficult decisions on how their firms can reshape and reimagine themselves for the current moment and the emerging new world of work, and in many cases that means optimizing costs and balancing new workforce needs.
So what goes into these decisions, and how can leaders manage the human and business needs of our uncertain times? That’s a question that we ask every day at Mercer, and our work with organizations big and small around the world has shown that there may be more than one right answer. But we wanted perspectives and input from some of the world’s leading voices, so we invited them to discuss the current costs and workforce imperatives in a #MercerChats tweet chat. Below are some of the key takeaways and greatest insights from that conversation.
Like putting the cart before the horse, one of the biggest mistakes any employer can make is neglecting their future for the sake of their present. The most common way for this to happen is to overlook your future talent needs when you’re facing a budget crunch. No matter how tempting, it’s vital to resist the pressure of short-term cost savings and maintain focus on what you’ll need to thrive in the future of work. JP Provost touched on this during our chat when he spoke to the importance of proactive business and workforce assessment to ensure the long-term viability of your organization, and Nicole Passmore took it one step further by pointing out the employees – and the costs that come with them – are an investment. Both Dr. Marcia F Robinson and Amy Laverock also echoed this sentiment, noting that the more employers invest in their people, the more they get back in return.
So what’s the take away? That while your workforce may represent your highest cost, it’s also your most important investment. Even if leaders find themselves needing to reduce workforce costs, they should be exceptionally weary of doing so in a way that would put their future in jeopardy.
A4.b. The more varied the #health and #wellbeing resources an employer offers, the more workers feel energized and supported — and the less likely they are to leave their employer. #MercerChats #diversity, #equality #inclusion https://t.co/PikwSOTwaq— Amy Laverock (@amy_laverock) September 29, 2020
A.4. Employee #benefits are an investment in your #workforce – reducing benefits may alleviate some pains short term, but if EEs have trouble affording, accessing and getting quality care, there may be more damage long term (and larger costs down the road!) #MercerChats https://t.co/a2SSv3xlxg— Nicole Passmore (@npassmore1) September 29, 2020
A1: A1: Orgs will struggle to see the difference between the actual COST in $ of empathy (benefits, flexibility etc.) and the VALUE the org will gain long term.— Dr. R. - The Workplace Evolutionist (@MarciaFRobinson) September 29, 2020
It’s an investment. #MercerChats #futureofwork https://t.co/X6YAXbzmQC
A3. Reshaping the #workforce requires proactively assessing where the business is going and what employee #skills sets will be required. Embracing #flexibility in the design to ensure programs offered are being valued is key. #Mercerchats https://t.co/D3dX7LhBeP— JP Provost (@jpprovost1) September 29, 2020
No decision that could negatively impact your workforce is easy. From both a human and business perspective, it just makes sense for employers to treat their workforce with empathy and look out for the individuals who keep their organizations running. But that doesn’t mean that the status quo can continue, and for any number of reasons, organizations may be forced to reduce headcount or restructure benefits in order to reduce costs. When these times come, it is absolutely imperative that those decisions be driven by reason, clearly articulated, and aligned to organization purpose and priorities moving forward.
Many of our #MercerChats participants touched on this point in our conversation, all of them from different but crucial perspectives. Angela Maiers noted how important it is for leaders to be driven by their organization’s core sense of identity and values if they want to stay ahead and retain some bearing in the continuous shuffle to remain agile and adaptive, and Antonio Vieira Santos shared that no decision should be made without listening to your workforce and understanding their priorities. After all, no one knows your organization or what it needs more than your people. But perhaps no one put it more simply then Norman Dreger, who reminded us that not only is a balance of economics and empathy the right thing to do, it’s critical for business success.
A8: So what should we tell our children? That to stay ahead, you need to focus on your ability to continuously adapt, engage w/others in that process, and most importantly retain your core sense of identity and values. #Mercerchats #futureofwork— Angela Maiers - Keynote | Author | Change Maker (@AngelaMaiers) September 29, 2020
A8 In age of #StakeholderCapitalism, everyone is watching. Companies that don't act socially, environmentally & ethically responsible will see their brand suffer. Marrying #EconomicsAndEmpathy is not just the right thing to, it's critical for business success #MercerChats #DDD https://t.co/gUYdVKwCAe— Norman Dreger #CFA #FCA #FCIA #FSA #DipIEBA (@NormanDreger) September 29, 2020
Everything’s cyclical. What goes around comes around. Nothing lasts forever. Say it any way you want, but the truth is that market downturns and cash crunches are never permanent, and when things turn around, talent will remember how you treated your people when times were tough. This is true for the individuals you let go – who may be your most highly sought-after talent when the market picks up – and the broader public who’s gotten to see and observe your employer brand in action. One of my all-time favorite quotes by Maya Angelou comes to mind here: “People will forget what you said, people will forget what you did. But people will never forget how you made them feel”.
So when making difficult decisions about your workforce or reward strategies, it’s best to keep in mind that what you do now will resonate in the future and impact how your organization responds to future crises. That’s why it’s so important to operate with intent, honesty, and empathy, as Diana Wu David shared during our discussion, and why goodwill is so valuable to protect, as Tamara McCleary added. Because while it can be difficult to maintain perspective when you’re in the eye of the hurricane, your people will be the ones who ultimately help you weather the storm.
A1. In today's challenging times, businesses that show empathy towards their workforce by sacrificing short-term economic gains to maintain #jobs will not only benefit by keeping skilled employees, but goodwill in the near future when the #economy picks up again. #MercerChats pic.twitter.com/DorCWsAyUD— Tamara McCleary (@TamaraMcCleary) September 29, 2020