Healthy people = healthy profits

Wellbeing and mental health are trending topics and for good reason! Many individuals and organisations are campaigning to end the stigma around mental health by raising awareness of the issue and fighting for better treatment and support being made available.

And businesses are catching on. More organisations than ever before are prioritising employee wellbeing and mental health over company profits. And this change in business approaches is yielding exceptional results.

Reduction in healthcare costs
It goes without saying that healthy employees cost you less. Most organisations pay out around $13,000 per employee on healthcare costs every year. And if you have an employee count of over 1,000…well, you do the maths. It doesn’t take a genius to work out that, when it comes to health, prevention is nearly always better than cure.

For many organisations, introducing office perks such as standing desks, healthy snacks, mental health treatment, gym memberships, and mindfulness initiatives have been great ways to support mental health and reduce health issues resulting from a sedentary lifestyle. “High-powered professionals often prioritise work over their own health. As laudable as this is, it can be unsustainable,” says Kayla Gill, content director at LuxuryRehabs.com. “It’s possible to achieve your goals while still living a healthy life.”

People want to work for ethical companies and so adopting these kinds of programmes can provide the added bonus of attracting and maintaining top talent

The rise of obesity and stress can have an extremely negative effect on employee performance. So, by taking proactive steps and caring for the mental and physical wellbeing of your team,you will see a reduction in medical claim costs and employee absences.

Improve recruitment and retention

Employees who are unhappy leave their workplace in search of somewhere better. Organisations that don’t prioritise the mental health of their employees will see a higher rate of employee turnover and find it harder to retain their top talent. Turnover costs US employers over $1 trillion a year.

Creating health programmes and enforcing wellness activities for employees are great ways to provide a healthy outlet for managing stress. This can make for a happier working environment. And a happier team means a more engaged and satisfied one.

What’s more, adopting health and wellness programmes shows potential employees that you are an ethical company that cares about treating people right and supporting them in all aspects of their lives.

People want to work for ethical companies and so adopting these kinds of programmes can provide the added bonus of attracting and maintaining top talent.

Boost productivity and engagement

Employees that are dissatisfied at work and struggling with their mental health will often be less productive and struggle to engage. Companies that prioritise employee wellbeing will see the mental health of employees improve, as well as their resilience to stress, their decision-making, their relationships with colleagues, and their approach to work.

Employee engagement is the gold standard for business success. Engaged and highly motivated employees will always do their best work and tend to go above and beyond what is required of them. Employee wellbeing and good engagement and productivity rates go hand-in-hand. One affects the other. Employees whose wellbeing in the workplace is prioritised are twice as likely to be engaged and productive at work.

If you aren’t investing in the mental health and wellbeing of your employees, you should be. Better mental health means boosted employee productivity and engagement, ultimately leading to higher profits and success for your business.

Better customer service
The better your customer service, the more customers you will attract and retain. Great customer service is central to the success of your business. Organisations that excel in customer service see the results of their efforts in the financial success of their businesses.

However, the success of your customer service will depend on the mental health and wellbeing of your employees. An overworked, stressed, or struggling employee will ultimately result in poor customer service. And this can hurt your brand reputation.

In contrast, employees that are well looked after and have high wellbeing tend to provide far better customer service, show more enthusiasm for their job, and be more productive in their role. These factors alone can boost business turnover and help win and retain high numbers of new customers.

Improve brand reputation

As a brand, if you support the mental health and wellbeing of your employees, it won’t take long for others to hear about your efforts. Employees love to shout from the rooftops about organisations they work for that allow for benefits such as flexible working hours, unlimited holidays, gym memberships, health insurance, and paid therapist appointments.

Organisations that provide the mental health of their staff are more likely to be highly favoured by their team, potential employees, and their customers. When people know that you care they are more likely to care about you, too. And in order to grow your business, you want people to care about it. So, supporting the mental health and wellness of your team is a great place to start.

Final words
Prioritising the mental health and physical wellness of your employees doesn’t just benefit them, it can also benefit your business. Healthier employees are happier employees and that means better job satisfaction, higher motivation levels, and increased company loyalty.



Redefining presenteeism in the workplace

Matt Jenkins argues that there are many reasons why people feel they can’t bring their “real self” to the workplace, which affects their productivity and retention of talent.
Many are familiar with the phrase “”Presenteeism‘As a person who gets a job even if he is ill. From coughs and colds to burnout and illness, people who go to work are less engaged and can be distracting.With vitality Reported by the BBC in June of this year Eighty-three percent of workers reported that presenteeism was present in the workplace. The quarter says it has deteriorated over the past year. There is no doubt that presenteeism is becoming an increasing threat to businesses around the world. However, there is a whole new category of presenteeism that needs to be considered. The idea is that an individual feels that he or she cannot bring his or her true self into the workplace, such as an extroverted or introverted personality, a sexual orientation, or a true expression of race or culture.

Hidden employee
Last year’s report from the Bureau of Higher Education Statistics (Hesa) found that African-American and Caribbean-black graduates were 6.3 points and 7.9 percent less likely to be satisfied with their work than white graduates.This is in addition to CIPD study found that LGBT + employees are more likely to experience workplace conflicts It’s more harassing than heterosexual or cisgender opponents.

Before Covid-19, there was a commonly held understanding of what it meant to be ‘present’ at work – it typically meant daily attendance at a particular office building. The term presenteeism was coined to describe the phenomenon at its extreme, and most work activities were based on co-location in a physical space. In fact, most forms of career advancement were generally considered to depend entirely on physical presence in the workplace for a regimented period of time.

However, since Covid-19 accelerated pre-existing trends towards more remote and flexible working, the concept of being ‘present’ at work has shifted. The pandemic eroded the concept that presence relies on physical co-location because for the past 18 months employees have had no choice but to be ‘digitally present’ as they work more flexibly across a range of settings, including their home.

The flexibility of work has not only impacted the space we work in, but also time. ‘Presence’ was once synonymous only with synchronous work, in which people work together on things at the same time (usually at a single office location). Now it is also an aspect of asynchronous work, in which work doesn’t happen at the same time for everyone and the cloud is the key location.

The workplace of the future

It is increasingly becoming clear that this redefinition of presence asks new questions of the office building. It can no longer be a dumb and unresponsive container for work activities carried out synchronously by a workforce that is physically attendant on a consistent and unchanging basis. In the post-pandemic era; it must become a smart and connected entity that can curate and manage the interactions of an office population whose presence will fluctuate with demand and reflect more unpredictable working patterns.

The pandemic has raised several debates in corporate real estate teams about the purpose of the office. While there is no single answer to this conundrum, the universal response in that the corporate office building will remain of critical importance as a hub to build culture and generate social capital, to seed innovation and train staff. But it will no longer be the only channel for work and it will no longer require daily attendance. In what some commentators have described as ‘omni-channel working,’ employees will work in the future via multiple channels. The task of the office building will be to become a ‘destination of choice’ that brings the right people together at the right time with the right tools for certain face-to-face activities.

The future-ready connected office

If ‘presence’ in the workplace is no longer a one-dimensional idea, but an increasingly multi-faceted one, then a stable, effective and unobtrusive digital infrastructure is needed to underpin all the emerging considerations around hybrid ways of working. Software and systems architecture need to seamlessly plug into the physical workplace and connect to other systems to work effectively and seamlessly to create the most flexible and collaborative work experience. Smart systems should be modular and scalable, so that companies can test the principles of the connected office at a basic level and be future-ready to scale up. In this context, the use of LED connected lighting with embedded IoT (Internet of Things) sensors makes a lot of sense from an operational and design perspective.

Academic research in the field of environmental psychology suggests that the continuing endurance of the office building is because it enables us to invent, collaborate, and learn together most effectively. There are fundamental psychological reasons why we need to be physically co-located to support creativity and innovation. As researchers Carlo Ratti and Matthew Claudel predicted in the Harvard Business Review in 2016: ‘Human aggregation, friction, and the interaction of our minds are vital aspects of work, especially in the creative industries. And that is why the quality of the physical workplace is becoming more crucial than ever.’

After the pandemic, the quality of the physical workplace will increasingly include smart systems and software to connect the infrastructure as part of a collaborative ecosystem. A shift in what it means to be present at work has seen to that



A new role for business leaders: Moral integrator

Claire was looking forward to the long holiday weekend. After two brutal weeks of late nights and early mornings getting ready for a new product launch, dealing with supplier disruptions in China, and managing a sudden labor shortage in Germany, the Fortune 500 CEO was ready to catch her breath and spend some quality time with her family. The plan was to leave first thing Saturday morning to beat the traffic headed to the shore. Instead of the alarm, though, Claire awoke to her cellphone buzzing. It was her company’s general counsel. The night before, one of the company’s top executives had been recorded drunkenly berating a waiter in racist and homophobic terms. Posted to TikTok within minutes, the video had already amassed more than 2.5 million views and was spreading like wildfire across Twitter and Facebook. Social media commentators were demanding action, institutional investors were calling, and requests for comment were flooding in from major news outlets. “Claire, how do you want to handle this?” asked the lawyer on the other end of the line.

In the past, few executives might have considered addressing social issues as part of their job description. Now, in an era when a single tweet can obliterate US$4 billion of a company’s value, it’s become even more important for leaders to understand how to negotiate this sensitive territory: in fact, it’s a business imperative. Executives need to know how to make sense of and engage with these issues so they can simultaneously deliver business results that satisfy shareholders, build trust with their employees, and meet the expectation many have that organizations are responsible for driving more equitable outcomes for society.

And the issues on the table are expanding rapidly. We saw this when North Carolina passed a bill in 2016 banning transgender people from using bathrooms in public buildings that did not correspond with their birth sex. Payments firm PayPal responded by curtailing its investments in the state, and performers canceled concerts and events. Amy Cooper, an employee of financial-services firm Franklin Templeton, was summarily dismissed by the company in 2020 after social media channels exploded with outrage over a viral video of her racially charged altercation with a Black bird-watcher in New York’s Central Park. More recently, when state legislatures proposed laws to restrict voting rights in Georgia, locally headquartered companies Delta Air Lines and Coca-Cola eventually came out against the move, following heated public debates. Underlying these demands is the notion that businesses have certain moral and ethical obligations to the public.

More PwC insights

Ten Years to Midnight
Increasingly, ordinary people, customers, employees, suppliers, and even social media influencers expect leaders to speak out and act ethically, and immediately, when it comes to issues of justice and equity in their organizations—and in society at large. These emerging leadership challenges cannot be delegated or outsourced if companies are to build and retain stakeholder trust. And they most certainly weren’t on the radar when most of today’s executives were in business school or working their way up the corporate ladder. No, these new challenges require a fundamental shift in how business leaders understand and practice ethical leadership.

The present conceptualization of ethical leadership considers leaders as moral individuals within their organization (and increasingly in society). But it does not address how to bridge the gap between internal and external stakeholders’ expectations. The negotiation of this complex set of relationships requires the integration of what might appear to be competing codes and values: the fiduciary responsibility to maximize investment returns versus the moral obligation to fulfill the organization’s stated purpose and contribute positively to the external world. It’s a difficult balancing act. For example, retrofitting manufacturing plants to cut carbon emissions in support of environmental sustainability goals may be the right thing to do. But it can cost a company hundreds of millions of dollars in upgrades and lost productivity, negatively affect quarterly earnings, erode the balance sheet, and depress share price.

CEOs, rather than being heroes or charismatic leaders, have to become moral integrators: people who recognize this tension and have the self-awareness to use collaboration and listening skills to navigate a world in which accountability is defined in different ways by different audiences.

Defining ethical leadership
Morals are an individual’s standards for right behavior. Ethics are the codification of individuals’ morals that inform the decisions they make and the actions they take. For instance, a person who believes institutionally raising animals for food is morally wrong may choose to adopt an ethic of veganism.

CEOs, rather than being heroes or charismatic leaders, have to become moral integrators: people who have the self-awareness to navigate a world in which accountability is defined in different ways.

So, what is ethical leadership, and where does moral integration fit in? Ethical leadership came into its own starting in the early 2000s, largely in response to corporate scandals such as that at Enron, the high-profile energy company that collapsed owing to fraud. Historically, the academic literature has defined ethical leaders as both “moral persons,” meaning that they themselves act in a moral fashion, and “moral managers,” meaning that they foster an environment that inspires or compels others to behave morally.

This definition has since been enhanced by introducing the dimension of moral entrepreneurship, whereby leaders innovate new norms of behavior that contribute to society’s moral development and build stakeholder trust. Consider the CEO of Seattle-based Gravity Payments, Dan Price, who in 2015 instituted a $70,000 minimum salary among his employees, or the menstrual hygiene company that includes people of diverse gender expressions in its advertising rather than only cisgender (people whose sense of identity corresponds with their birth sex) women.

The operational and financial benefits of ethical leadership are significant and demonstrable. Studies show that ethical leadership improves the bottom line and produces returns. It directly combats corporate wrongdoing, such as financial fraud. There’s a link between ethical leaders and positive employee performance. When employees trust their leaders to act ethically, they are more willing to speak up when they see something wrong. The employees of ethical leaders tend to be more satisfied with their jobs and more willing to go the extra mile. In social psychology, that’s called organizational citizen behavior (OCB). OCB describes discretionary actions on the part of employees that are outside the formal performance management and compensation systems and beneficial (or intended to be beneficial) to the organization. For instance, OCB is demonstrated by that salaried employee who stays late and works over the weekend to help others meet a pressing deadline, or the one who volunteers to organize office-wide social events and brings homemade treats for team members’ birthdays. Ethical leaders increase OCB, and studies have demonstrated that OCB is a contributing factor to enhanced firm performance.

Two case studies
As part of my doctoral studies, I analyzed how organizations applied ethical leadership in response to publicized incidents of anti-Black racism involving their employees. The goal was to test the idea for the role of moral integrator. I focused on two cases that took place in the United States in the last three years within publicly traded companies. The cases followed the same basic pattern: a casual observer’s smartphone video of an employee demonstrating racist behavior went viral; social media users quickly identified the employee’s company and flooded its social media accounts with demands for an organizational response.

In one case, the event occurred in the workplace; in the other, it transpired outside the office, but the location did not appear to make a difference in how the public reacted. In both cases, the companies responded to the outcry with a mix of statements on social media, press releases, and traditional news interviews with corporate executives detailing the steps the company was taking to address the situation.

The employee in one of the cases was terminated as soon as the video went viral. In a video interview with a business news outlet, the company’s CEO discussed the decision to immediately fire the employee in terms of aligning management’s actions with the organization’s stated values, claiming “zero tolerance for any kind of racism.” Journalists questioned the CEO’s portrayal of the company’s ethos, noting that former executives and current board members had financially supported political candidates with ties to white nationalism and that the company’s track record of hiring and promoting underrepresented groups was abysmal.

In an open letter on the company’s website, the CEO repeated the importance of diversity and inclusion (D&I) to her personally and to the company, noting that D&I directly contributed to delivering superior service to clients and returns for investors. However, none of the company’s public quarterly or annual reports bore any mention of D&I. The topic was also absent from the two earnings calls following the event. Neither the company’s leaders nor the analysts raised it.

The response in this first case exemplified a lack of moral integration by the organization’s leaders. Although the CEO made the expected remarks in the media about the incident and about the company’s values, and the company acted quickly to discipline the employee, when it came to communicating with investors and proactively taking a stand on the issue of racism, the executives were silent. The message conveyed was that the company outwardly presented an image of caring about D&I but inwardly considered it irrelevant to investors. In other words, talk of anti-racism was a show for the public rather than a topic for the boardroom. The company’s response did not move the dial or signal that this was a watershed moment. To a degree, it came from a standard tool kit. Firing an employee for behavior that violates a company’s code of conduct is an established human resources practice.

Public reaction to the company’s handling of this incident was mixed. Members of the business press heaped praise on the CEO for being so passionate about D&I. Social media commentators lamented the lack of tangible outcomes, noting that firing a single employee and returning to business as usual did not address systemic issues. Ultimately, the incident and the company’s response did not appear to hurt earnings or share price. The executives lived up to their fiduciary responsibility to investors but not to the expectations of some stakeholders.

In the second case I examined, the executives approached their response differently. The employee was not terminated as a result of the incident. Rather than focusing on the employee, the CEO and other leaders concentrated on the broader issue of racism in business and society. They framed the event as management’s failure to properly train and educate employees about unconscious racial bias. “This is on me and my team,” said the CEO. Some cable news journalists questioned whether this response from the company would make it a target for activists looking to create trouble for prominent brands. One interviewer seemed to imply that the problem was the recording and sharing of the event rather than the incident itself. The executives dismissed this notion. Instead, they acknowledged that they could not eradicate racism because it was a systemic issue in society—but they could address it within their company. And they transparently put forth a plan to start driving change there. Moreover, they made their training curriculum freely available online for other organizations to use.

The incident and the cost the company incurred in responding to it were proactively discussed by the executives on the two earnings calls following the event and mentioned in the quarterly and annual reports. Most importantly, these executives were humble. They met with the individuals who were harmed in the incident and apologized. They also listened to concerns from community groups and publicly shared what they learned. The company’s earnings and stock price rose following the incident, and the company earned praise from stakeholders across the board.

In both cases, the executives were trying to perform a delicate operation of integrating their personal ethics with both the expectations of organizational stakeholders and their fiduciary responsibility to shareholders. These goals may not always seem to be aligned because of the costs involved in delivering to stakeholders in the short term. Companies know they must build and maintain trust with societal stakeholders by acting in accordance with evolving societal norms for ethical conduct. The recent focus on environmental, social, and corporate governance (ESG) programs and reporting reflects the awareness of this imperative among investors and analysts.

How to incorporate moral integration
How can CEOs both head off incidents that will spark a backlash and send messages that all stakeholders will accept?

In the two cases analyzed here, certain executives stood out because they simultaneously managed stakeholder and shareholder expectations, particularly regarding the ability of businesses to bring about social change in their organizations; and they listened to stakeholders and shareholders with discernment. They engaged in difficult conversations with individuals who had been harmed by the events involving their employees, and publicly acknowledged, with humility, the challenges their businesses faced.

They reframed the issue of corporate participation in efforts to promote social welfare as investments that benefited the business as well as society, not purely as an expense. For example, the CEO in the second case explained that the company was investing in its culture to directly enhance customer experience and said that this would drive revenue and market share—key contributors to share value. The CEO put the company’s actions into words that linked ethical leadership practices to fiduciary responsibilities in terms investors understood and could appreciate.

One way to emulate this approach is to learn how to have the right kinds of conversations. This is where coaching can help. Dialogue should not be performative, appropriated by corporations solely for the self-serving goal of enhancing organizational efficacy. Coaches can support organizational leaders in practicing ethical leadership by helping them make sense of these complex situations and then, through dialogue, creating lively exchanges and mutual understanding between groups with seemingly competing priorities.

Another element to encourage is heightened self-awareness. Self-awareness prepares leaders to better trust their instincts and act in alignment with their values. Both elements are critical to the practice of ethical leadership. In the second case study above, the self-aware leader instinctively acted with humility and tried to address the systemic cause of the problem: racism in society.

Self-awareness also improves resilience. The surest way to cause people to burn out is to make them do something for money they believe to be wrong. To engage in more effective and productive dialogue, leaders will need to develop a strong sense of how their words and actions affect others. Among the many ways to cultivate self-awareness, mindfulness is one of the most powerful. Mindfulness is often trivialized, despite neuroscientific research demonstrating its value.

Every day, executives are facing events and realities that require moral integration: viral videos of racist language from employees, pay equity concerns, sustainability targets, and ransomware demands, to name a few. They need the ability to operate beyond existing leadership practices. They need to understand how to connect in more authentic ways with stakeholders without compromising their integrity. As moral integrators, they can help influence their shareholders to accept initiatives aimed at advancing social justice by translating their actions into terms compatible with their fiduciary relationship. Similarly, organizational leaders can work with stakeholders to understand their concerns and desires for change and identify approaches for implementing solutions. Ultimately, these approaches can deliver results that build trust in society and produce sustainable shareholder value.



The Power of Sign Language to Create a More Connected and Inclusive World

Like most college and university presidents, I find this fall to be an especially promising time as our schools have resumed face-to-face instruction across the country. We no longer take for granted the power of learning in the physical presence of others. While learning can be effectively achieved virtually, after the hiatus of face-to-face learning for many of us over the past 18 months, we enter this new academic year with a deeper and more profound appreciation for the physical presence of our communities. Language is central to all of this.

At Gallaudet, our reunion this fall on campus is especially poignant and perhaps more deeply cherished. For our linguistic minority that uses and learns through both American Sign Language (ASL) and reading and writing English (bilingual education), being back on campus means restoring our 3D visual language and learning experience and our visual sign language vibrancy. When the Covid-19 pandemic hit, we seamlessly shifted our entire educational mission into the cloud, into the digital virtual world, including our pre-K-12 educational programs. However, a majority of our students left campus to reside in predominantly spoken language environments and maintained their lifeline to the signing visual experience through video screens. Once the screen is turned off, so too, is their access to the visually vibrant signing campus. While we were able to replicate much of our sign language vibrancy online, we lost the 3D and physical vibe that we achieve when we gather and socialize, whether it’s intentional and planned or just incidental meetings in the halls or on our campus grounds.

Access to language and communication is a fundamental human right, one that all too often is denied to deaf, hard of hearing and deafblind people. Only one to two percent of deaf children worldwide have access to education in sign language. For centuries, sign and spoken language have been set up as rivals inchild development, language planning and deaf education, presenting parents with a stark binary option, pick either spoken language or sign language, denying too many children the full range of options to support their language, brain growth andlifelong well-being. Consequently, policies and practices have missed the opportunity to support families and children,embracing the full possibilities that can be achieved if every child — not only deaf, hard of hearing and deafblind children — receives exposure to sign and spoken languages. Sign language is not only beneficial for those born deaf. Most adults will suffer from late hearing loss after the age of 55. Knowledge of sign language, far more than most people realize, is a universal imperative.

At Gallaudet in 1960, a team of researchers proved that ASL was a language in its own right. Today, on our campus and in the Gallaudet neighborhood, you see the power and vibrancy of sign language everyday with both hearing and deaf people. Many of the nearby businesses have signing employees, as well as visuocentric menus and point-of-sale terminals. On H Street there is a signing Starbucks, a deaf-friendly Chase branch, and Mozzeria, a deaf-founded and deaf-staffed Neapolitan pizza restaurant. Just a few blocks away is the Apple Store at Carnegie Library with nearly two dozen deaf employees. We are seeing the power of how American Sign Language strengthens our community and brings us together in new and inclusive ways. Late deafened people and their families can now find settings where they can naturally immerse themselves in sign language to build a more inclusive family experience for everyone.

Our sign language economy in the United States is big business. It brings economic value to our cities and our neighborhoods. Our local and state bilingual education programs create thousands of jobs for deaf and hearing people who are bilingual. Colleges and universities across the nation generate more than$43 million in revenue from teaching ASL, with Gallaudet training most teachers for these programs through our Master of Arts in Sign Language Education program. Gallaudet is proud of the fact that our university and our alumni have played a major role in building a sign language economy in the U.S. now worth an estimated $2 billion to $3 billion.

There are many misconceptions surrounding sign languages. Just like there is no universal spoken language, sign language is not universal. There are hundreds of sign languages and dialects used throughout the world, including ASL, Black ASL, and protactile sign languages used by deafblind people

The human experience and research affirm that the brain does not prioritize spoken language over sign language. Science has shown that the brain recognizes sign languages and spoken languages equally. Science also has shown the benefits or “gain” of learning visual language on brain development, including enhanced reading skills and comprehension, improved complex brain functioning especially with math and music, even protection against diseases like Alzheimer’s. Importantly, research on how human brains produce language on the eyes and hands as effectively as through the ears and mouth is changing our understanding of the impact of visual learning and visual language on the development of the brain and children.

Sign languages are currently enjoying a moment in the spotlight, from the myriad of deaf actors using sign language in recent movies such as CODA and television shows such as New Amsterdam and This Close, to the use of certified deaf interpreters at recent COVID government briefings. All of this is welcomed, but these must not just be fleeting moments that fade once the cool factor wears off, an all too familiar experience for the deaf community. Sign language should be respected, embraced, valued the same as any other language each and every day.

More than ever, as Gallaudet has returned to campus and the classroom, I contemplate the power and vibrancy of sign language and its integral role not only in our students’ lifelong success but also in the creation of a more inclusive and connected world. As it has for 157 years, our university remains steadfast in its mission to expand bilingual learning opportunities across our students’ lifespan. By doing so, Gallaudet will continue to help the broader world more fully recognize, respect and embrace the value of deaf, hard of hearing, and deafblind people and their contributions to our world.

But Gallaudet and the broader deaf community cannot do this alone. Our world needs a sign language mind shift, a profound societal awakening that access to any language, signed or spoken, is ultimately about the fundamental right to human connection – connection that we all rightly expect, need and enjoy – connection that is so central to our life and liberty.

Fittingly, the theme of this year’s International Day of Sign Languages was “We Sign for Human Rights.” I invite all of you to be our partners as we grow the signing ecosystem and cultivate opportunities in the local, national, and global economies. What can you do? Befriend your deaf, hard of hearing and deafblind neighbors and colleagues, take ASL classes, support deaf organizations and businesses, hire deaf talent, and immerse yourself in the vibrant signing culture close to where you live and work. We all will be enlightened through our shared experiences and the far more connected and inclusive world that we create together.



How Entrepreneurs Solve the Big Fish vs. Big Pond Dilemma

ollaboration with a partner is not strictly a two-way affair; instead, prospective partners take the entire competitive landscape into account when forming ties.

In the movie Jerry Maguire, a sports agent played by Tom Cruise is fired from his top agency after openly criticising its impersonal approach. He is forced to go it alone, but all his clients desert him, preferring to continue to be represented by a large, established organisation. That is, all except American footballer Rod Tidwell (played by Cuba Gooding Jr), who feels his career could use more personalised attention.

While movie-goers know that, indeed, things end well for Tidwell, an important question remains: When striking a partnership, is it better to be a big fish in a small pond, or a small fish in a big pond? In a paper published in the Academy of Management Journal, my co-authors* and I looked at the particular case of developers and publishers of PlayStation2 (PS2) video games, at a time when self-publishing of titles was not yet an option and developer-publisher ties were necessary to commercialise a game. We found that the level of experience of developers and the relative uncertainty they faced in terms of getting personalised attention from a publisher were driving much of their decision to seek a certain “pond” size.

Two conflicting goals requiring a trade-off

Akin to the book industry with its authors and publishing houses, the video game industry involves developers that propose game concepts and initial development, and publishers that provide late-stage development and access to markets. Out of the 163 PS2 games which have sold more than 1 million units, only 30 were published directly by Sony, the manufacturer of the console.

When partnering up, developers typically seek two things. On the one hand, they want a close collaboration in order to develop the very best product there is. In an extremely crowded video game market, an average product may essentially be a “dead fish”, so to speak. (Over 3,800 game titles have been released for the PS2.) On the other hand, developers would also like to secure the largest market access. After all, how sad if no one ever hears about their newly launched PS2 game.

The problem is that meeting both goals to the highest degree is unrealistically difficult. Large publishers with strong connections to retailers and which are able to organise vast launch campaigns often attract many high-calibre partners. As such, a partner may not receive a lot of personalised attention. Especially if many other, stronger developers work with the same publisher. A trade-off is usually necessary.

We collected data on 367 developers of PS2 games and 170 publishers between 2000 and 2009, the time period when console games were most popular. The majority of our sample firms were based in the three countries that dominated the industry: Japan, the United States and the United Kingdom. Our data collection strategy enabled us to build a comprehensive dataset on the activities of the mostly private developers and publishers in the industry.

We supplemented our data analysis with two waves of in-depth interviews. We found that younger or newer entrepreneurs focused on getting development help and worried less about reaching the largest number of consumers. This point was particularly salient for early-stage developers. As one of them told us: “When you’re innovating … there’s always some snag and always some complication that you did not foresee. It is crucial than [an established firm] is going to support you.”

Keeping an eye on the other horses in the race

In addition, the more competitive the market – i.e. the more developers are out there competing for publisher attention – the more a novice entrepreneur might be concerned about getting the proper level of attention that will ensure product differentiation. An interviewee said: “You have to worry about the competitive set that the publisher supports. The publisher may have great capability in your title because they also publish your major competitor. Then you have to ask yourself, is it going to lead them to prioritise your project lower.”

After all, entering a collaboration is only the first step. Securing the desired resources from the partner/publisher is not always guaranteed. Established firms in technology industries may sign more developers than they can eventually support, a fact that is not lost on these entrepreneurs. The number and the quality of the “other horses in the race” create uncertainty – and a definite threat – for developers. As a matter of fact, our data showed that when a developer ranked lower than average (in terms of the quality of its previously published games), it was 26 percent more likely to have its projects cancelled than its higher-ranked peers.

In all, experienced entrepreneurs who didn’t expect to need as much support based on their track record were willing to give up almost four times as much development help as inexperienced developers to secure better market access. Of course, publishers do not wait around to be chosen. Naturally, established publishers with high market access also prefer to partner with experienced developers, reducing their risk of needing to toil over duds.

Collaboration is more dynamic than it may seem at first glance

Although our dataset concerns the video game industry, our results apply to other types of entrepreneurs who need to form collaborations, partnerships or other types of ties to go to market. These include content creators of any kind partnering with platforms or other market intermediaries that may help refine their products. Biotechnology entrepreneurs partnering with pharmaceutical firms to hone their products and gain market access are another great example.

In fact, we all face the big fish/big pond dilemma more often than we realise. When we take a job in a famous company, we accept the idea that we are (in all likelihood) going to be just one of the many very smart people working there. Standing out may prove difficult. Conversely, if we choose to work for a new start-up, we may rise rapidly, but our opportunity to shine outside the firm (through speaking engagements or media requests, for instance) may remain limited. In our personal lives, if we choose to befriend a very popular person, we may have to fight for their time and attention.

Any sort of collaboration entails a trade-off between our status, the status of the partners we have in mind, and the status of the other people interested in partnering with them. The process is a lot more dynamic than it seems. Depending on the competitive landscape, you may want your very own Jerry Maguire.



How To Be A Good Internal Consultant

As an internal consultant and a member of an internal consulting team (although “internal consultant” or “internal consulting” is not in our “official” job titles), my colleagues and I are often called on to lead, support, and offer coaching, consultation, or facilitation services on wide-ranging areas, projects, and initiatives including culture, change management, conflict management, leadership development, organizational development, learning & development, onboarding, and so much more. Indeed, now more than ever, today’s HR professionals play the role of internal consultants (Miller, 2016).

The Association of Internal Management Consultants (AIMC) says that an internal consultant provides various client support services within the enterprise. They may be in a variety of areas (e.g., project management, quality management, human resources, information technology, training & development, finance, supply chain management, process improvement, etc.).

According to Phillips, Trotter, and Phillips (2015), “The rapid rate of change coupled with heightened competition on a global basis is increasing the need for companies and public sector organizations to develop effective internal consulting capabilities” (p. 3).

Important competencies to be a successful internal consultant (Phillips, Trotter, & Phillips, 2015) include communication skills, feedback skills, problem-solving & analytical skills, and organizational skills. Additionally, several core consulting skills (AIMC, 2017) are needed, such as business acumen, business process optimization, change management, coaching & consulting skills, and project management.

If you want a company to value you as an indispensable internal consultant — especially in the human resources, talent management, and leadership development space — here are a few tips I’d like to share based on my work and experience as an internal consultant.

First, it doesn’t matter how smart or knowledgeable you are or how much experience you have or bring. If you want to excel as an internal consultant and have top corporate decision-makers listen to you, you’ll need to master the art of influence & persuasion — how to sell your ideas and convince leaders to go along with you. Leaders are short on time and attention. You must master the ability to be concise, to-the-point, and ensure that your timing is right. For instance, if you are advocating for a specific program or agenda, but it does not align with your organizations’ goals or senior leaders’ mindsets, it will be very unlikely your proposal will ever have a chance of getting off the ground. The ability to both gain senior leadership buy-in and support and navigate an organization’s hierarchy, politics, and culture is absolutely critical to an internal consultant’s success (Zentis, 2018).

Second, learn to be interpersonally savvy because it is “an essential part of getting things done within organization” (Barnfield & Lombardo, 2014, p. 235). “Interpersonal savvy helps you read and address relationships appropriately and at the right time” (Scisco, Biech, & Hallenbeck, 2017, p. 261). I have seen individuals with graduate education and degrees (i.e., knowledge) be terribly ineffective at internal consulting because they were unable or unwilling to move out of their comfort zone (i.e., relying solely or mostly on knowledge or technical skills, rather than being savvy enough to read the situation and the relationship and understand what others need and respond accordingly).

Third, a positive attitude goes a very long way in helping you gain social capital, as well as getting you to the table of these decision makers. Regardless of how smart, talented, or experienced you are, if you have a bad attitude and cannot get along with others, you will struggle to get senior executives to listen to you. They may accept your work or ideas but will never see you as a leader or a person with the potential to become one. You have to play nicely with others. Even if you are the resident “genius” and you know how to do everything, if your attitude sucks, no one will care what you have to say, even if you’re right.

Earlier, I shared important competencies needed to be a successful internal consultant. These included Communication Skills, Feedback Skills, Problem-Solving & Analytical Skills, Organizational Skills, Business Acumen, Business Process Optimization, Change Management, Coaching & Consulting Skills, and Project Management.

Here are 8 competencies (some of these will be identical, similar to, or complement the ones previously outlined, while others will be new and different) you can incorporate into your repertoire to help become an effective internal consultant:

From CCL Compass (Scisco, Biech, & Hallenbeck, 2017):

  1. Communication (p. 9) – “Listen, convey your ideas and emotions with clarity and authenticity, and adapt your personal speaking as needed for the situation and audience to foster an environment of trust.”
  2. Interpersonal Savvy (p. 261) – “You need interpersonal skills to recognize and assess what others need. These skills involve not only listening to others, but also include noticing social cues that communicate how others are thinking and feeling, even if they don’t say so outright.”
  3. Influence (p. 17) – “Your greatest leadership asset is your ability to understand and persuade others. Influential leaders know how to get others to work with them, whether or not formal authority exists.”
  4. Tolerating Ambiguity (p. 401) – “[I]n today’s business environment, ambiguity is pervasive and affects leaders at all organizational levels. . . . Learn to handle ambiguity comfortably and confidently and learn to anticipate situations rather than simply react to or retreat from them. Make peace with ambiguity and gain greater control over how you handle key decisions in daily situations and over your career.”

From Awaken, Align, Accelerate (Nelson & Ortmeier, 2011):

  1. Business Acumen (p. 159) – A leader with strong business acumen understands the global environment, business model, and key drivers of the organization, and leverages this understanding to recommend alternatives and measure performance.
  2. Building Collaboration (p. 285) – A collaborative leader participates with and involves others, promotes cooperation, builds partnerships, and resolves conflicts.
  3. Creating Alignment (p. 57) – An effective change leader creates alignment by ensuring the structure, systems, people, and processes are aligned in support of organizational goals.

From Bernholz and Teng’s Harvard Business Review article (2015):

  1. Be Entrepreneurial & “Be Scrappy” – In Bernholz and Teng’s article, in which they offered recommendations on how to build an in-house consulting team, one of their suggestions is “be scrappy” and adopt an entrepreneurial mindset. At EMC Information Infrastructure (EMC II, which has since been acquired by Dell), an information technology, storage & protection company, Bernholz (now VP, Head of Corporate Strategy at Adobe) and Teng (now VP of Global Business Transformation at Commvault) knew they didn’t have the luxury of having extensive support staff that external firms often enjoyed. So they made up for the staffing shortfall “by assigning all [internal EMC] consultants to an “office development” team, such as recruiting, training and onboarding, knowledge management, or social committee. Though these require time commitment beyond project-work, they offer team members the opportunity to shape the group’s operations and culture, instilling an entrepreneurial mindset among [internal EMC’s] consultants.”

Takeaway: Here’s my advice to those who wish to be outstanding internal consultants to organizations. To increase your chances of success: (1) Take a few steps back (figuratively) to really understand the issue or problem and absorb (like a sponge) everything you see, hear, and experience; (2) Build and maintain solid long-term relationships throughout the company; and (3) Work to connect the dots by thinking about and asking these questions: (a) “Why has this issue been a recurring one?” (b) “How many people or departments have an influence over this or play a key role?” (c) “Who truly holds the decision-making power and who are the influencers in the organization?”, and (d) “If others (inside & outside the company) have come up with a solution, why has it not worked?” By talking and listening to others, you will be in a great position to better know and understand the organization and the industry in which it sits. Finally, learn to get along and work well with others and be nice. If you are a jerk, you will have a very hard time providing internal consulting services.



Five actions to help your organization leap from survivor to thriver

A new generation of leading companies emerging from the pandemic crisis will operate by the rules of a new S-curve of growth.
To innovate at scale, organizations can take a future-back approach by using future scenarios to create a multi-horizon strategic roadmap.
Using data to understand the customer and moving from supply chains to supply networks will help companies innovate the unique experiences customers demand.
Since World War II, the global economy has followed an extended S-curve of growth. The foundation of this growth has primarily rested on the traditional value drivers of scope, scale and efficiency to measure performance and value.

However, within the last 10 years, we’ve begun to see a shift, both with the backlash against companies that ignore their systemic impacts on the world, and with the explosive rise of digitally-driven, hypergrowth “unicorn” companies that have exponentially raised expectations around the consumer experience and propelled valuations to new heights.

We expect another disruptive generation of leading companies to emerge from the current pandemic crisis, accelerating existing trends and creating new ones. They will operate by the rules of a new S-curve, where innovation timelines compress and ideation, prototyping, piloting and commercialization will happen in rapid cycles at global scale.

Examples of companies that leaped onto the new S-curve during the pandemic include a healthcare enterprise software company developing a video-based medical consultation service in 48 hours for healthcare workers in the UK, an African taxi start-up becoming a delivery service, and a Canadian biotech company that used its AI platform to identify drugs already FDA approved that had the potential to treat COVID-19.

These and other innovative companies have left behind the traditional drivers of scope, scale and efficiency in favor of long-term value creation to meet the dynamic demands of their customers or broader society. In following the path toward long-term value, organizations will need to build their performance using new transformational value drivers that put humans at the center of purpose and strategy, deploy technology at the speed where exponential benefits accrue, and innovate at scale to be at the forefront of reshaping industries and customer expectations.

innovation infograph
The magic of the next S-curve showcases solving challenges with creative approaches
Even before the pandemic, customer behaviors and preferences were shifting toward hyper-personalized, predictive and adaptive customer experiences. The pandemic, which has kept many people at home, has rapidly escalated these expectations. Customers want the companies they interact with to know who they are, what they want and how to deliver products and services that are of high value to their lives.

Companies that use data to gain a deep understanding of their customers and provide unique experiences — whether it’s individualized cancer care, custom-designed and 3D printed athletic shoes that provide a perfect fit or furniture that is ergonomically designed to relieve a customer’s specific pressure points — will exponentially accelerate along the next S-curve of growth.

To innovate at the speed and scale they’ll need for success, companies will have to transform strategically, digitally and operationally.

Companies that use data to gain a deep understanding of their customers and provide unique experiences will exponentially accelerate along the next S-curve of growth.

How EY can help
Strategy consulting
EY-Parthenon professionals recognize that CEOs and business leaders are tasked with achieving maximum value for their organizations’ stakeholders in this transformative age. We challenge assumptions to design and deliver strategies that help improve profitability and long-term value.

Read more
A future-back approach sets the strategy for innovating at scale
Innovating at scale along this new growth trajectory requires companies to take a future-back approach to strategic planning, as exponential value creators have done in previous times of crisis and change. Leaders of these companies look into the distant future and consider whether their business will be as relevant then as it is now. They then use their purpose to explore their opportunities and their vision to work future-back scenarios that make sure they are following a path where the priorities and actions of today are positioning them on a relevant and exponential trajectory for 15 or 20 years down the road.

With future scenarios as a starting point, companies can then create a multi-horizon strategic map that charts a course from the future back to today. The latest EY Megatrends report is a think-tank research report on global futures and highlights five steps for developing a future-back strategy using megatrends as a foundation. The concept of future-back planning results in an ability to break free from past assumptions, explore megatrends that will change the world and identify weak signals beginning to reveal the future. From there, organizations can use that understanding, today, to develop a better strategic investment and transformation plans.

Future-back planning provides an opportunity to break free from past assumptions, explore megatrends that will change the world and identify weak signals beginning to reveal the future. Organizations can use that understanding, today, to develop a better strategic investment and transformation plans.

Data will be the differentiator between products and unique experiences
Technologically, companies looking to make the leap from middle of the pack to exponential value creators, will need to more effectively harness the reams of data they are already collecting and generate vast amounts beyond what we collect today.

In a recent EY study, 83% of digital transformation leaders understood the value their companies could gain from leveraging data and analytics insights to speed innovation. Even 70% of digital transformation laggards see the same value.

Understanding the value data can bring
of digital transformation leaders use data to help them innovate faster.

To be successful, organizational leaders need to see data as an asset worth investing in. Further, companies will want to act on the following three innovation imperatives, as outlined in How data can help you innovate when change is constant:

Assemble the right teams that have experience across strategic change, design thinking, data science and industry knowledge. They’ll be able to ask the right questions to get the right results.
Develop a human-centered innovation business model, operating model, and culture that embraces and drives change. Using data to augment the capabilities and experiences for people in innovative new ways is the key to realized value.
Deliver insights and results fast and have a clear plan for industrialization. Analytics sprints can help teams iterate through business questions, starting simply and becoming increasingly complex to support new innovations that can be embedded at scale.
Of course, any actions companies take to strengthen their data and analytics, and artificial intelligence capabilities will need to tie back to the future-back strategy the company has set.

Customer expectations propel operational value chains into an autonomous era
Operationally, value chains will need to evolve to keep pace with making innovations tangible and real in terms of products and services for customers. For years, companies have relied predominantly on efficient, just-in-time supply chains that mass produce products to ship in bulk to customers. In delivering hyper-personalized experiences, companies will need to move toward flexible, resilient supply networks that are highly responsive to local needs, and flexible enough to reconfigure and deliver new products and services quickly.

In a networked era, supply chains will be data-driven and allow for end-to-end visibility, hyper personalization and real-time communication. This will allow companies to manufacture uniquely designed, bespoke products at scale. Emerging technologies also will play a critical role in disruptive innovation by helping companies to make real-time decisions and integrate data to source, make, sell and deliver their products.

In an autonomous era, companies will produce products at or nearer to the source of consumption. In this new autonomous reality, items would be available to customers on-demand and in real-time by accessing the flow of intellectual property and production when needed and producing products in seconds.

If the goal is to deliver hyper-personalized experiences, companies will need to move toward resilient supply networks that are highly responsive to local needs, and flexible enough to reconfigure and deliver new products and services quickly.

Along the new S-curve, the beyond is closer than we think
Along the new S-curve of growth, innovating at scale will require companies to place humans at the center of their customer journey, develop a future-back strategy, harness their customer data to deliver unique experiences and turn their supply chains into networked then autonomous supply networks. By understanding individual customer needs and delivering at scale in real time, companies can find themselves leading the next generation of post-pandemic disruptors into a beyond that is closer than we think.


The Explosive Growth In Coaching: One Of The Biggest Trends In Business

This week BetterUp announced another $300M round of funding, valuing the company at $4.7 Billion. Recurring revenues are already over $100 Million this year more than doubling year over year. Vendors like SpringHealth (Unicorn on the therapy side of coaching), CoachHub (a fast follower to BetterUp), Torch (coaching integrated into L&D), and others are now riding this wave.

As Alexi Robichaux (CEO) puts it, the world of benefits, learning, and employee development have merged. And I really have to agree. And the “digital health” industry itself has received more than $20 Billion this year, showing how explosive this new combination can be.

If you think about it as a CEO, the connection is obvious. We want our employees to feel healthy, energetic, engaged, and ready. Our Employee Experience research points this out in detail: all these benefits programs come together.

Later this month we’re going to be launching a massive study on this market, one we call The Healthy Organization. And what you’re going to see is that wellbeing programs, coaching, development, and leadership coaching are all connected together. In fact the one silver lining of the pandemic is that it taught us all a big lesson: if you don’t focus on the “whole person” at work, all these individual HR programs don’t add up.

Consider what Alexi tells me about his clients (Chevron, for example). Before the use of coaching, managers had sporadic leadership development training and many of them just struggle to learn to lead. Remote workers and staff members try to “learn to deal with stress” on their own. The wellbeing strategy is clear at the CEO level, but the head of compensation and benefits often sees these as “programs” and measures results through utilization.

BetterUp, which integrates development, coaching, assessment, and career growth, ties all this together. So this massive spending on “benefits” (which sits in the comp department) and the similarly massive investment in training (which sits in L&D) can now come together.

Chevron: Precision Development At Scale

I’ve interviewed Chevron in detail and the impact of BetterUp is amazing. Let me share some details here.

Since the start of the program in July of 2020, more than 1,200 Chevron leaders received personalized development. The Net-Promoter score of the experience is +65 (my last study of corporate L&D found that the L&D function itself has a negative net-promoter score), and 94% of these leaders say “coaching makes them more effective at their job.”

And it gets even better. Through a new offering called Coaching Circles, Chevron leaders can come together in small global groups to discuss and learn through expert facilitated discussions. These programs have now reached more than 3,000 Chevron leaders in 15 languages.

Other benefits from leaders (analyzed through self-reflection and assessment) at Chevron include a 15% increase in employee recognition, 12% improvement in business alignment, 13% improvement in problem-solving, and 16% improvement in strategic planning.

And in the case of Chevron, this initiative has helped the company transform and improve its entire performance management process. As the energy industry goes through massive change, this benefit alone more than cost-justifies the investment.

Where Is All This Going?

As you’ll read about in our upcoming Healthy Company research, Wellbeing at Work has come a long way. Going back to the Cadbury employee health and living facilities in the 1800s, today companies want to provide an end-to-end “healthy experience” for employees.

This brings together the disciplines of employee engagement, development, job design, and coaching into one integrated view. Add a dose of technology, and you get AI-enabled coaching, “whole-person” assessment, and a myriad of digital health programs added on. It’s a new whole-person focus for employees, and this brings the entire function of HR together. All in the flow of work.

And the vendor market comes together too. Vendors like BetterUp, which focuses on the whole employee “system,” will transform the way we think about corporate training, wellbeing, and leadership.

As I’ve told people many times, if there’s one thing we’ve learned from the pandemic, it’s about the “unquenchable power of the human spirit.” When we give people the right support and a safe environment, they do amazing things for your company.

Start thinking about all your HR programs as investments in the “whole person” at work. It will pay off many times over.



Data Drop: Touchless Greetings, the Death of the Open Office and the Impact of Class on Collaboration

Returning to work was always going to churn up a mixed bag of feelings among employees and HR vendors are looking to get a sense of what those feelings are. Combine it with the ongoing wave of resignations, increased automation in the workplace and what you’ve got is a recipe for data telling you the story of how people are reacting to it.

As usual, my inbox is full of the latest studies and surveys being conducted by HR vendors, researchers and employers of all sizes. In today’s data drop, we’re going to take a closer look at how employees are coping with all these factors and what they aren’t looking forward to about going back to work.

No Touching
Remember the days of handshakes? Well your memory might be the only place they exist moving forward. After COVID-19, it’s only natural that a heightened awareness of contamination and swapping germs will be more commonplace. As employees return to work, employers are finding ways to give people more distance from each other or more opportunities to sanitize themselves and their environment.

When it comes to greeting each other, a Qualtrics study reveals that more than a third of employees say they’ll be using touchless greetings with colleagues, such as a wave or a friendly nod.

You might be tempted to think: what’s the big deal? It is after all, it’s just a greeting among people you already know. But the fact is, many employees have anxiety about the awkwardness of social situations and following proper etiquette when returning to the office. And for many of these people, this will be the first time they have met colleagues face-to-face. Around 57% of people surveyed said they would be meeting some colleagues for the first time when returning to the office.

While it may seem a small thing, this might be a good time to establish some norms around social etiquette, at least in the short term future while so much uncertainty swirls around COVID variants and how to ensure people are vaccinated.

Give Me My Space
As long as we’re talking about vaccinations, the folks over at interior design and architecture blog Homedit conducted a survey that revealed some concerns people have about the new workspaces they’ll be coming back to.

There were two really notable points to come out of it though. The first, was that 72% of employees feel that their employer should require some kind of proof of vaccination in order for someone to return to work. The data illustrates what many an HR professional knows to be true; the level of anxiety around COVID-19 has only eased somewhat following vaccine rollouts.

READ: Employee Experience Remains a Priority as Work Models Shift Post Pandemic

The second only illustrates their anxiety about being around each other further, with 83% of respondents saying they would prefer any other office layout than an open one. And science may have finally given us more of an understanding as to why that is.

A study released in June from the Journal of Management & Organization show that open office plans have a negative impact on employees. Specifically, it studied the impact of open office noise on cognitive performance, physiological stress and mood, monitoring things like heart rate, facial expressions and skin conductivity. The findings show a causal relationship between open office noise and physiological stress. People tended to sweat more and facial expressions show signs of tension.

After a year of people finding new levels of productivity and comfort working at home, plunging them back into any office environment could have negative impacts. If you’re absolutely certain returning employees to an office is what you want to do, you might want to consider ways to help them find spaces that ease stress levels. If you don’t, keep in mind that more than half of employees around the world are willing to find a new job if their employer eliminates the option to work from home at least part of the time.

Class Collaborators
Collaboration is a key component of a dynamic workplace these days and something that you find everyone from floor manager to C-suite executives talking about. It’s a skill that pops up in just about every job description these days and employers spend a great deal of time figuring out ways to facilitate and encourage collaboration.

Research published in the Journal of Personality and Social Psychology suggests that what drives someone to collaborate may not simply be their personality type, but their life experience, particularly as it relates to class. The study looked at groups of people from varying classes performing interdependent team work. What they discovered is that groups from lower social class backgrounds had conversations that were more wide-ranging, active and balanced than their middle and upper-class counterparts, something key to high team performance.

As the study notes, these people often fail to stand out as individual star performers in a divide and conquer approach to work, but when working as part of a collective are extremely effective.

Previous studies have revealed that in most collaborative environments, 3-5% of the employees involved were contributing 20-35% of the value add. Perhaps future research will draw a link between the two, but in any case, when looking at building teams that diverse in both culture and style, class may play a bigger part than you ever imagined.

Returning to work was always going to churn up a mixed bag of feelings among employees and HR vendors are looking to get a sense of what those feelings are. Combine it with the ongoing wave of resignations, increased automation in the workplace and what you’ve got is a recipe for data telling you the story of how people are reacting to it.

As usual, my inbox is full of the latest studies and surveys being conducted by HR vendors, researchers and employers of all sizes. In today’s data drop, we’re going to take a closer look at how employees are coping with all these factors and what they aren’t looking forward to about going back to work.

No Touching
Remember the days of handshakes? Well your memory might be the only place they exist moving forward. After COVID-19, it’s only natural that a heightened awareness of contamination and swapping germs will be more commonplace. As employees return to work, employers are finding ways to give people more distance from each other or more opportunities to sanitize themselves and their environment.

When it comes to greeting each other, a Qualtrics study reveals that more than a third of employees say they’ll be using touchless greetings with colleagues, such as a wave or a friendly nod.

You might be tempted to think: what’s the big deal? It is after all, it’s just a greeting among people you already know. But the fact is, many employees have anxiety about the awkwardness of social situations and following proper etiquette when returning to the office. And for many of these people, this will be the first time they have met colleagues face-to-face. Around 57% of people surveyed said they would be meeting some colleagues for the first time when returning to the office.

While it may seem a small thing, this might be a good time to establish some norms around social etiquette, at least in the short term future while so much uncertainty swirls around COVID variants and how to ensure people are vaccinated.

Give Me My Space
As long as we’re talking about vaccinations, the folks over at interior design and architecture blog Homedit conducted a survey that revealed some concerns people have about the new workspaces they’ll be coming back to.

There were two really notable points to come out of it though. The first, was that 72% of employees feel that their employer should require some kind of proof of vaccination in order for someone to return to work. The data illustrates what many an HR professional knows to be true; the level of anxiety around COVID-19 has only eased somewhat following vaccine rollouts.

READ: Employee Experience Remains a Priority as Work Models Shift Post Pandemic

The second only illustrates their anxiety about being around each other further, with 83% of respondents saying they would prefer any other office layout than an open one. And science may have finally given us more of an understanding as to why that is.

A study released in June from the Journal of Management & Organization show that open office plans have a negative impact on employees. Specifically, it studied the impact of open office noise on cognitive performance, physiological stress and mood, monitoring things like heart rate, facial expressions and skin conductivity. The findings show a causal relationship between open office noise and physiological stress. People tended to sweat more and facial expressions show signs of tension.

After a year of people finding new levels of productivity and comfort working at home, plunging them back into any office environment could have negative impacts. If you’re absolutely certain returning employees to an office is what you want to do, you might want to consider ways to help them find spaces that ease stress levels. If you don’t, keep in mind that more than half of employees around the world are willing to find a new job if their employer eliminates the option to work from home at least part of the time.

Class Collaborators
Collaboration is a key component of a dynamic workplace these days and something that you find everyone from floor manager to C-suite executives talking about. It’s a skill that pops up in just about every job description these days and employers spend a great deal of time figuring out ways to facilitate and encourage collaboration.

Research published in the Journal of Personality and Social Psychology suggests that what drives someone to collaborate may not simply be their personality type, but their life experience, particularly as it relates to class. The study looked at groups of people from varying classes performing interdependent team work. What they discovered is that groups from lower social class backgrounds had conversations that were more wide ranging, active and balanced than their middle and upper class counterparts, something key to high team performance.

As the study notes, these people often fail to stand out as individual star performers in a divide and conquer approach to work, but when working as part of a collective are extremely effective.

Previous studies have revealed that in most collaborative environments, 3-5% of the employees involved were contributing 20-35% of the value add. Perhaps future research will draw a link between the two, but in any case, when looking at building teams that diverse in both culture and style, class may play a bigger part than you ever imagined.



Five things freelancers must know about GST

The outbreak of the COVID-19 pandemic has accelerated the adoption of technology and transformed the gig economy. Owing to the mounting uncertainty, people have switched over to freelancing. At present, India has the largest freelance workforce after the US.

A freelancer is a person who works independently and earns an income on a per-job or per-task basis. It could also be contractual, usually for short-term work. Freelancers work on multiple projects simultaneously for different clients. A freelancer is not an employee of any organisation and hence is not on pay-roll or entitled to any company benefits or perks.

Under the current Goods and Services Tax (GST) laws, any person supplying taxable services must be registered at the start from where they are providing such services. GST rate, as applicable to any other service provider (which is typically 18%), would also apply to such freelancers, based on the nature of services being provided.

GST affecting income
For registered freelancers, GST liability which is required to be deposited by them with the government is usually collected from the service recipient. This is over and above the value of services rendered by freelancers. While the same may result in slight working capital/cash flow issues with the time difference in payment to department viz-a-viz collection of their payments from customers, however, there would not be any other impact on freelancer’s income. This holds true in most cases unless the customers do not agree to pay GST over and above their value of service i.e. when the value of services are contractually agreed to be inclusive of GST.

In addition to the same, freelancers may be eligible to claim an input tax credit of GST paid to suppliers/vendors on procurement of goods or services, which are used in their freelancing business, subject to conditions. Hence, typically GST is not a cost to them if applicable.

For an unregistered freelancer, while there would not be any liability to pay GST, any GST paid on procurements to vendors would be a cost as they would not be eligible to claim input credit for the same. Accordingly, in such cases, the same would have an impact resulting in an upward increase in the overall cost of services rendered by freelancers to their customers.

Voluntary GST registration
When a person is not mandatorily required to obtain registration under GST law (usually when it does not cross the threshold limit), they can register by choice even if the turnover is less than the prescribed threshold.

If a freelancer obtains voluntary GST registration, they will have to abide by the provisions of the GST law. Also, they would be required to undertake all the related compliances and pay the applicable GST. However, obtaining voluntary registration may increase the overall compliance burden. This is seen as a preferred option while dealing with B2B customers, as they usually deal with registered persons. Obtaining GST registration would also help to reduce the input GST costs which a person may incur on procurements which would then be available as credit to such freelancers.

Services on online marketplaces
GST is generally applicable in both scenarios, i.e., where services are provided via online marketplaces like Upwork, Freelancer, etc. or directly to clients. The liability to collect/ deposit the same with the IT department would remain with the ultimate service provider in both scenarios, as per criteria mentioned earlier.

In addition to the same, in case of online marketplaces like Upwork, Freelancer etc., an analysis may be required to examine if the same would qualify as an ‘e-commerce operator’ under GST law. In such a case, additional GST compliances would have to be undertaken by such online marketplaces. Online marketplaces qualifying as e-commerce operators, would also be required to collect TCS @ 1% from persons, including freelancers who are supplying their goods and services through their electronic platform. Credit for such TCS would be available to such persons, subject to conditions.

In addition, depending on the exact nature of services being provided through online marketplaces, GST implications would have to be determined from such service providers.

Filing returns
Freelancers are required to comply with the prescribed compliances like other registered GST assessees. They would be required to undertake filing of monthly/quarterly (depending on turnover) returns, i.e., return of outward supplies (GSTR-1) and summary return for outward and inward supplies (GSTR-3B). In addition, annual compliance in the form of GSTR-9 is also required to be undertaken depending on the prescribed turnover.

In case the freelancer’s turnover exceeds INR 5 crore, annual reconciliation statement in the form of GSTR-9C is also required to be filed. Multiple penalties for non-compliances (registration, documents, invoices, etc.) of various provisions have been provided under the law, however, in case of delay in filing of monthly/quarterly returns, a late fee of INR 50 per day per return has been prescribed.

GST registration benefits

One may argue that obtaining GST registration would result in additional compliance burden on small service providers like freelancers, however, it may be noted that GST has provided a very simplified compliance process for taxpayers.

There are various benefits in obtaining GST registration such as availability of GST credit for tax paid on procurements, which in case of unregistered freelancers would be a cost. Same can also be utilized for discharging output GST liability of services, by the freelancer, thereby passing minimal burden on the end consumer.

Further, obtaining GST registration also helps service recipients gain more trust and deal more transparently with freelancers. Even the government encourages larger businesses to deal with GST compliant service providers.



The Politics of Influence in Top Management Team Meetings

Interactions between the chief executive and other members of the top management team appear to follow distinct scripts. Managers who take note can boost their standing or stay out of harm’s way.

Top management teams (TMT) have been studied since at least the 1980s for insights into how chief executives and their deputies make the strategic decisions that can make or break organisations. But little is known about what exactly happens in the decision-making process, which more often than not is steeped in politics and power play. This article is about a ground-breaking study we conducted that filmed and analysed verbal and non-verbal exchanges in TMT meetings as they happened.

Our findings, published in a new paper, suggest that, contrary to previous research that highlighted the influence of stable, longstanding alliances in organisations, coalition-building in TMTs can also be in the moment and fluid. By forming even temporary coalitions with other TMT members and deploying simple influencing behaviours, senior managers can persuade the CEO to take their side and sway key decisions.

Reading the room right

We studied two TMTs similar in size, gender composition and other key dimensions. TMT A belonged to a medium-sized computer game company based in Canada while the other, TMT B, was the top team of a business services company with global operations.

For each team, we videotaped their meetings and examined them in minute detail, from emotional tone, body posture, hand gestures to eye contact. We also interviewed each of the team members after the meetings.

Five kinds of CEO-TMT member interaction patterns emerged, which we outline below.


In the most amicable of the interaction patterns, the CEO and other TMT members see eye to eye right from the start.

What would be a wise strategy in this environment? Build on this congenial atmosphere by employing the rational argument and drawing others into the conversation.


This is when the CEO disagrees with the rest of the team at the beginning, and the team resolve their differences through a constructive discussion during the meeting. Our findings show that managers can gain legitimacy by appealing to a higher authority and, again, by using rational argument to great effect.


This is a scenario in which the CEO retreats to the background as an observer, while two team members debate an issue.

Duelling managers can bolster their case by declaring ownership (“this is my project”) and drawing on one’s experience and knowledge (“I know my team better than anyone else”). The spectating leader might be wise to delay a decision while emotions cool, as the CEOs in our study did.


This is when a disagreement between the CEO and a team member triggers an adversarial dynamic at the start of a strategic issue discussion. There is a risk the decision-making process becomes polarised.

Here, participants need to be politically savvy. They can seek support, build a coalition by directly appealing or looking at colleagues, and draw on the credibility and agenda of others. A CEO could check to see if there’s scope for an upward appeal (“the founder needs this to be done before the end of next month”).


This pattern evolves when the CEO and a TMT member are in opposition: The former challenges and undermines the latter while other members simply look on.

For those who find themselves in an undermined position, dismissed and ostracised by the team, the best chance of surviving is to duck, retreat and fight another day. In our study, one executive chose to derail the discussion, and another turned the conversation to another topic. Another magnified the risk of the rival proposal.

Playing your cards right

Importantly, we found that more than one constellation could form in a single meeting. Team members can be congruous or cooperative when they discuss one issue and adversarial or undermining another. This suggests that the TMT decision-making process is more dynamic and nuanced than shown by previous research.

How you use influencing behaviours matters. For example, we observed rational argument in all five constellations albeit with very different delivery – relaxed incongruous, emphatically with plenty of hand gestures in cooperative, and calm and authoritative in undermining. Each led to different outcomes. Thus, tone of voice and body language can be very effective influence mechanisms.

Finally, cultures also play a part. In East Asia, for example, leadership styles tend to be more hierarchical, providing fertile soil for undermining and adversarial situations, although the general patterns hold.

TMTs are contested spaces characterised by conflicts, alliances and negotiated orders. When collaboration fails to resolve differences, our study shows that executives with deft political skills are likely to prevail. In other words, those who can relate well and demonstrate situationally appropriate behaviour in a manner that inspires confidence and trust will get their way.

Our findings offer tips that could help senior managers navigate the patterns of interaction we observed. A reliable guide to reading the situation and deciding what actions to take is to ask yourself: Am I aligned with the leader? Am I aligned with my peers? How much energy do they have about the issue? Then play your hand accordingly.



Do you really want that promotion?

If you are good at your job, all sorts of push-pull forces within your organization—and society at large—will propel you into bigger roles with more responsibilities, including managing people for the first time or taking on larger teams.

And many people understandably want those bigger jobs, and the reasons go beyond the pay bump that often comes with promotions. It’s called a career ladder for a reason: it’s something to climb. As human beings, we are wired to strive for greater status, and all the markers that come with it: titles, more pay, and a better office (at least, back in the day when people had offices). Social media platforms amplify that dynamic because we share our titles with the world.

Within organizations, there can also be an assumption that all high-performers want to move higher. So, as managers assess and develop talent to be future leaders, the default belief at many companies is that people will want to move up—a point that I hadn’t quite appreciated until I interviewed Shawna Erdmann, the senior vice president of learning at Comcast, the telecommunications multinational based in Philadelphia.

“Often the leaders of a company, including boards and HR, will pick and choose among upcoming executives for promotions, but no one ever has a conversation with that individual to ask them, ‘What do you want to do? What are your ambitions? What do you see as your goals or your next steps?’” she said. “So often we miss that critical piece and then we wonder why, when we elevate someone, they might not do as well as we expected. But nobody ever asked them, ‘Do you really want that job?’ Maybe they were just super happy making a difference at their particular level, and they didn’t have the ambition to do the next thing. We need to get better at having those conversations.”

Listening up
The crises of the last 18 months have led to profound shifts in our perception of the role of organizations in society, the nature of work itself (how and where it gets done), and the qualities that matter most in leaders now. This period of disruption has also led many people to reconsider what they want to do and where they want to live. And so, with all these fundamental career questions being put on the table, I would argue that we should add one more: do people really want the promotions that everyone assumes they want?

Yes, I get that it might seem like trying to fight gravity. The reward systems we have in place are structured to create a powerful upward pull. But once the thrill of the new title and pay bump wears off, a lot of people find themselves in roles that they may not like or be suited for. It’s a fact of life that many people think they want a particular job until they actually get that job.

The reward systems create a powerful upward pull. But once the thrill of a new title and pay bump wears off, a lot of people find themselves in roles they may not like or be suited for.

It’s a point that Kasper Rørsted, the CEO of Adidas, made to me when I interviewed him back when he was CEO of the German chemicals company Henkel. During our conversation, I asked him what advice he would give to someone who was about to become CEO for the first time. His answer is just as relevant for anybody looking to move into any higher position because every senior position brings new demands and difficulties.

“I would ask them the question, ‘Do you really want the job?’” Rørsted said. “It’s such a demanding job. On the outside, it looks very shiny. But there’s a lot of hard work. You get paid to do all the uncomfortable things. You don’t get paid to go play golf in Savannah. It’s not just glamour. I’m not saying it’s hardship, but are they able to live with it? So that’s the first one—‘Is it really what you want?’”

The question is a personal one for me. Over my 30-year journalism career, before I moved into consulting four years ago, I twice turned down an offer to run a big newsroom department. I was the number two in the department, and so the assumption was that I would want the job. But in working closely with my boss, I had exposure to what his job entailed, and I knew that much of it didn’t suit my strengths or personality. And I wanted to keep doing what I enjoyed most as an editor, which was working with reporters to do great journalism. Did I pay a penalty in terms of my trajectory there? No doubt. Do I regret it? Not for a second.

The “up or out” culture that started in many fields such as law and academia—the pressure to achieve a certain rank within a certain period of time or else—has become a bedrock notion of many companies. But some CEOs I’ve interviewed over the years have applied fresh thinking to compensation and hierarchies so that talented individual contributors feel rewarded without the usual pressure to move into bigger management jobs. They include Selina Lo, who was then CEO of Ruckus Wireless, a provider of wireless networking equipment based in Sunnyvale, California.

“In my company, there is a rule that all new managers need to know: that it’s not a given that their people [under them] will be paid less than they are,” Lo told me in our interview. “That’s part of becoming a manager—that you really have to enjoy enabling people. I want people who are good managers to be managers. I don’t want people to become managers just because they feel they need to.” And she wanted people who are not manager material but have other skills to get the monetary rewards for doing their jobs well.

Think of it as the Peter Principle in reverse: rather than rising to their “maximum level of incompetence,” according to the famous maxim that describes how ambitious employees often trip themselves up by taking jobs they are unqualified for, people may realize they don’t want a particular job because it doesn’t match their skills or career goals.

Don’t get me wrong. I’m all for ambition. But for those considering promotions or HR leaders managing talent pipelines, the ambition should not be blind. It’s time people start asking the question more often: do you really want that job?


Mature workforce – a team of domain experts, a talent pool!

Why should we hire mature, seasoned experts?
Hiring managers are often torn between hiring for domain knowledge, work skills relevant to the current era, and sheer experience. Experience counts in almost all facets of the professional dimension. While younger employees already have the upper hand in networking, face timing, and handling tech gadgets, but, what about in-depth knowledge derived from business experience?

Does age matter when you need domain expertise to run your business?
Age-related attitudes are a significant challenge in today’s workplace, largely influenced by skills, new age thinking, technology savviness, the pace at which businesses run, and the need for work opportunities across the age spectrum.

Our experience, and findings from our readings, have led us to understand that balancing age, work skills, and experience will be inevitable in work places of the future.
According to the United Nations’ World Population Prospects 2019, by 2050 one in six persons will be over the age of 65 – up from one in eleven in 2019. This longevity shift affects all societies globally, while some at an early stage, others at an advanced level.

Asia and Europe have some of the world’s oldest populations, with people aged 65 and older. Japan takes the lead with 28 percent, followed by Italy with 23 percent. At slightly under 22%, Finland, Portugal, and Greece round out the top five.

China’s population comprises 12% of people aged 65 and up. In the United States it is 16 percent, 6% in India, and 3% in Nigeria. (Sources: United Nations Population Division, World Population Prospects 2019)

According to Standard & Poor’s (S&P), by 2050 the number of elderly persons in the Saudi Arabian population overall, will rise to 15% from 3% currently.

So, what all this leads to is that traditional forms of retiring employees is a luxury that no society can afford any longer. Besides, science has proved that knowledge and skill (as obtained on the job, which are also the key indicators to any job performance) can continue to improve even at the age of 80.

Hence the question is – is it really wise to ignore the contribution of a valuable resource as the mature expert?

What’s our take?
As is our experience in our business, in today’s management parlance mature experts refers to the 45+ age group. Typically, a 45-year-old with management qualifications would have 20 years of domain experience. The majority of the mature domain management professionals on our own platform are under 60. People are retiring at the age of 50, either by compulsion or by choice.

According to the data above, certain countries are rapidly aging, while others are decades away from a similar fate. As a result, certain countries like Japan or Italy are experiencing a labor shortage, and others like Vietnam or HK are thirsting for the wisdom of experience. This imbalance is a business opportunity to explore flexible ways to engage the global workforce.


Beamery Acquires Flux: A New Type Of Talent Marketplace

he Talent Marketplace space is red hot. Driven by the hot job market, companies are snatching up tools to improve internal mobility and the Talent Marketplace segment has become essential.

This space, pioneered by vendors like Gloat and Fuel50, was designed to use AI and skills inference to help employees find internal jobs, roles, projects, and mentors. These platforms work exceedingly well (I haven’t talked with a single company that didn’t find success here) so vendors like Eightfold, Workday, Oracle, PeopleFluent, Hitch, and SuccessFactors have all jumped in.

The leading vendors (Gloat is the leader at this point) have intelligent platforms that can import employee profiles, identify skills from experience and resumes, and instantly recommend new positions, projects, and mentors. They then go further and create a company-wide skills taxonomy that can be used for internal development, skills assessment, and eventually workforce planning.

Initially designed to create “Inner Mobility” (Gloat’s original name) or “Career Paths” (Fuel50’s pioneering), these are now all-in-one employee experience platforms that pinpoint learning, help recruiters head-hunt internal staff, and help managers staff teams. Companies like Schneider Electric use these platforms to help managers “staff and organize teams” and even let employees find mentors, create career plans, and plan their personal development.

In other words, the Talent Marketplace platforms are eating everything around them. They’re starting to look like Learning Platforms, Recruiting Platforms, Talent Intelligence Platforms, and more.

And this is all good stuff. Right now companies find it difficult to identify the skills they have, the skills they need, and the location and fit of job candidates for open and new positions. The Talent Marketplace, once actively used, has the potential to help with all these issues. Hence the reason big vendors like Workday, Eightfold, and Oracle are in this space.

Enter Beamery, a company well known for the Candidate Relationship Marketing (CRM) platform.

Beamery is a pretty cool company. The first time I saw it I was more or less blown away. Similar to Eightfold, Beamery is a “data platform” not simply a software system. The company imports tens of millions of employee profiles and indexes them to find job candidates, fit people to new roles, and create high-powered recruitment marketing programs. And it also does things like identify who is in your existing candidate database so you can find “silver medal” candidates as hiring gets tough.

Beamery has been very successful. Workday Ventures and Accenture Ventures are investors and many big companies (Wells Fargo for example) use Beamery for their sourcing, campus, talent attraction, and candidate marketing processes. And this is now very strategic. Our new research The Definitive Guide to Talent Acquisition discovered that brand reach and candidate marketing is now the #1 factor in attracting job seekers, so Beamery is an important system.

So what’s new? Beamery just acquired an exciting company called Flux (most of you don’t know them) which has been building a groundbreaking new talent mobility system. The combination of Flux’s platform with Beamery makes the company highly competitive with the likes of Gloat and Eightfold and lets companies combine internal and external resourcing in a single platform

I won’t try to explain all that Flux does, but let me point out that it was built with Uber as a design partner, focused on using AI to find internal and external candidates for full-time, part-time, and gig work. It also gives employees control over their own development and careers with intelligent job, learning, and mentorship recommendations (similar to other talent marketplace vendors).

In addition to using a skills inference engine (which most of these platforms have), it also embeds a proprietary “Job Fit” assessment. What this does is essentially diagnose your personal interests, behaviors, and aspirations and helps you find “the right fit” rather than just “a job that leverages your skills.”

This is actually a pretty big deal. A typical skills system might suggest that “because you have an engineering degree and work as a software engineer you probably would be interested in a cyber-security job.” But in reality, you might be tired of engineering and really want to become a team leader or executive coach. A skills engine would never know this, but Flux would figure this out.

While there are other such assessments on the market, by embedding this into the Talent Marketplace, Beamery lets everyone in the company understand their thinking, working, and interaction style. SuccessFactors new People Model does this, but no other vendor really offers this type of functionality. You can buy a third-party assessment, but with Beamery and Flux this comes out of the box.

A large enterprise in the transportation sector reported using Flux very successfully, enabling it to place thousands of employees in full-time, part-time, and gig positions.

How does this fit into Beamery’s business? The company is positioning this as Talent Lifecycle Management, a single platform to manage candidates, employees and alumni. As you can see, Beamery sees itself in recruiting, internal mobility, and Talent Intelligence all in one.

And Beamery has something else up its sleeve. Understanding that the “skills engine” market is crowded and fragmented, the company wants its skills system to be a “hub” for others. While I haven’t seen how this works, Beamery designed its system to “translate” skills taxonomies from other systems, not necessarily to be “the single skills system of record.”

This, by the way, is what many other skills vendors are trying to do since most skills engines focus only on one part of the problem. Beamery, like other recruiting vendors Eightfold and Phenom, has a lot of experience inferring skills because of its large data set. So Beamery’s strategy, similar to that of Eightfold (and soon Gloat), is to let you add any type of data into the system – documents, email traffic, and other information that infers and validates skills.

In summary, Beamery is entering a very hot and exciting space.

In the last few weeks Gloat introduced its Organizational Agility (talent intelligence) and Opportunity Hub (third party content marketplace). Eightfold has expanded into vertical talent intelligence, intelligent job architecture, AI-enabled succession management, and new learning solutions. And other vendors keep piling on. So while Beamery has a pretty impressive system, they also have plenty of competition.

I will be discussing all this at our Irresistible Conference (May 23-25 in the beautiful USC campus) and explain how all this comes together. Please come join us to learn much more.


Agile and Accountable Organization Design the Need of Hour: Study

When it comes to organization design, the last few years have seen companies continuously experimenting with it, with changes in business dynamics, geographies, and new product or service launches. Organization design is a specific science. However, according to Josh Bersin’s latest study, many companies seem to be practicing it inconsistently or have very simplistic approaches. According to the study, as more than 90% of jobs are service roles today, traditional organization models do not work anymore; companies need models that empower people and encourage innovation. The study also found that organization design is one of the most important things to do today. It found that a great organization design is agile and accountable, creates clarity and productivity, and encourages growth. The study covered a few topics to help business and HR leaders develop a more agile and accountable design. Here are a few findings and recommendations from Josh Bersin’s latest study. See more: 4 Key Trends That Will Guide HR Strategies in 2022 Organization Design Matters Now More Than Ever Last year was one year of hope where businesses worldwide were looking to return to pre-pandemic levels. Just as they were starting to recover, the Great Resignation happened. Millions of people started quitting their jobs in droves in the U.S. alone. There were various reasons for this mass resignation. So, how can companies hire or retain great talent? According to the study, one way is to design models around remote and hybrid work, considering both are becoming a norm now. Simultaneously, the new models should also consider essential or deskless workers. Then, there is digital transformation industry convergence they must take into account. So, how should companies design their organization models? Josh Bersin’s study proposed seven major elements as part of its Organization Design Framework. They are business model design, operating model design, work design, job design, organizational structure design, methodology and approach, and implementation and adoption. Organizational Design Framework The Organizational Design Framework Source: Josh Bersin Company, 2022 According to the study, several management practices contribute to organization design. Hence, the framework groups them into seven elements instead of analyzing them independently. Leaders Lack Confidence in Their Organization Design The study surveyed over 350 companies and discovered a lack of confidence among leaders in their organization design. Most companies were not agile and accountable. They felt unsure when it came to managing their organization design and did not have clear guidelines for optimizing the redesign. The study also found that a few things worked, and a few were missing in the existing organization designs. Here are a few things that worked:
About 60% of respondents could clearly define the market segments they served.
About 51% consistently communicated their strategic direction.
About 50% understood the founder’s history and cultural impact.
Much of this clarity seems to have come about due to the pandemic. However, there were also a few critical elements missing.
Only 9% said they used agile organizational models
Only 11% used advanced methods to understand how work happened
Only 12% involved employees directly in organization design
The study further found that the organization design in most organizations surveyed was inconsistent, hierarchical, reactive, and traditional. To understand where companies are in the maturity level of their organization design, the study drew up an organization design maturity model as shown below. Organization Design Maturity Model Organization Design Maturity Model Source: Josh Bersin Company, 2022 While companies at level 1 have no expertise and perform poorly, companies at level 4 outperform others and can be considered role models. According to the study, 25% of the surveyed companies were at level 1, and 33% were at level 2. About 31% were at level 3, while only 11% were at level 4. Some Organization Design Strategies and Practices Are of More Importance The study tried to understand if all the strategies and practices of organization design matter or some have a bigger impact on business outcomes. After analyzing its organization design framework, it found that a few dimensions have a bigger impact. Accountability and rewards, flexible structure, and effective change management were found to have a very high impact on organizational outcomes. They were followed by purpose and business strategy, talent strategy, culture and leadership, skills and experience focus, and flexible role design. On the other hand, traditional job architecture and team-based structures had minimal impact. How can companies climb up the maturity model to become both agile and accountable at scale? Great organization design solutions are more strategic than having an agile manifesto and using traditional design models, jobs, and organizational structures. Here are five findings that can help.
As mentioned earlier, most companies feel insecure or inexperienced about organization design. Many of them also lack a dedicated organization design team. The study proposed that creating a dedicated team that owns, demystifies, and defines the domain pays off by enhancing business efficiencies.
Many companies have traditional hierarchical structures suitable for the industrial age and are least impactful on business outcomes today. Work design is the most impactful element, yet companies are least effective in the area. Hence, companies should focus on how they operate than how they organize.
Many companies think they need to be tech companies to work in agile ways. However, with the right approaches, any organization can become agile and accountable.
When many companies think of organization design, they focus on individuals when implementing the model. However, employee experience and capability considerations should be part of the design and not an afterthought.
A major finding was that accountability is vital to organization design. A focus on accountability and rewards makes success sustainable.
To help companies start, the study laid out 15 essential practices and strategies that have the biggest impact on business outcomes, including innovation, financial performance, and people metrics. 15 Essential Practices 15 essential practices of agile and accountable companies Source: Josh Bersin Company, 2022 See more: Tips for HR Leaders To Overcome 5 Common Objections When Proposing Change How Companies Can Move From One Maturity Level to the Next So, how can organizations move from Level 1 of the organization design maturity model to Level 4? The study lays down a few steps. However, before following these steps, organizations should know which level they are at. They should also realize that they cannot skip a step to reach the highest level. Further, they should commit the necessary resources and efforts to achieve the next level. According to the study, the following steps will help organizations move from one level to the next.
To move from Level 1 to Level 2, organizations should become intentional about organization design.
To advance from Level 2 to Level 3, companies should focus on strategy and culture.
To move from Level 3 to Level 4, companies should translate strategy into work activities.
With a good organization design becoming necessary, companies should also focus on operationalizing it. Here are a few steps they should take.
Identify the business problem to solve and define measures
Bring a cross-functional team together
Run organization design as a business process instead of a project
Build HR capabilities for organization design
To Conclude Organization design is no longer an option but a necessity for businesses to grow and thrive in a continuously changing world. Simultaneously, it need not be a mysterious black box that cannot be decoded. By identifying their level in organization design maturity, what capabilities they need to build, what elements they need to focus on to create the best impact on business outcomes, and what actions they need to take, companies can become agile and accountable. This will set up organizations for success, mitigating cost pressures, empowering employees, and finding the right solutions for partners and customers.


Why Compassionate Leadership Makes Both Dollars And Sense

TOPLINE Elon Musk sold more than 4.4 million shares of electric car company Tesla earlier this week for just under $4 billion, according to Securities and Exchange Commission filings released Thursday evening, shortly after the billionaire Tesla CEO agreed to buy Twitter.

Elon Musk Visits Site Of New Tesla Gigafactory In Germany
Tesla CEO Elon Musk talks on August 13 near Berlin, Germany. GETTY IMAGES
The sales took place on Tuesday and Wednesday, at prices ranging between about $872 and $999 per share, the regulatory filings said.

Musk still owns more than 168 million shares of Tesla.

Shortly after the sales were disclosed, Musk tweeted: “No further TSLA sales planned after today.”

$246.2 billion. That’s Musk’s net worth, according to Forbes’ estimates. His stakes in Tesla and rocket maker SpaceX account for most of his wealth.

Twitter’s board of directors agreed Monday to sell the company to Musk, wrapping up a dramatic period that began with Musk buying up 9.2% of Twitter and later making an unsolicited bid to purchase the entire social media company at a valuation of $44 billion. The deal—which still needs to be approved by Twitter’s shareholders—will require Musk to come up with some cash: The billionaire offered to pay for Twitter using $21 billion in equity financing, in addition to more than $20 billion in loans.

Shares of Tesla have fallen more than 12% this week, closing at $877.51 Thursday. Some analysts think the sliding share prices are tied to Musk’s commitment to buying Twitter, which could distract the Tesla CEO and force him to sell part of his stake in the company.

Amid climate catastrophe and pandemic-induced disruption, a new age is taking shape. To prepare, business must lead with digital, empower consumers and act with purpose, says Euan Davis, who leads Cognizant’s thought leadership.

The Future of Us COGNIZANT
Amid widespread dysfunction—a pandemic, a previously unthinkable war, unprecedented weather events, snarled supply chains, rampant labor shortages—it’s easy to sense the old world fading away, never to return. Less obvious, but as certain, is the dawning of a new era.

This new reality will be defined by a volatile planet whose citizens, businesses and governments discover new ways to function productively, safely, sustainably and meaningfully. It will also be infused with astonishing technological progress and innovation and hope.

Call it the “net zero era”—not because carbon reduction is the only need of the day but because the term encapsulates the many challenges the world faces, the most threatening of which is sustaining the planet. For business leaders everywhere, it will be essential to recognize the glimmers of this new era and grasp what’s important and what’s possible.

Field guide to the net zero era
We’ve developed a field guide to what the net zero era entails, as well as the three essential drivers forward-thinking businesses need to embrace to navigate it successfully. (For a full exploration of the topic, see our e-book “The Future of Us.”) Here’s a quick rundown on each driver—why it’s vital and how to prepare for it:

  1. Digital+: View everything through a digital lens.
    The complex solutions needed to solve our interconnected social, economic, health and environmental challenges will rely on the speed, automation, intelligence and connectedness that only a digital-first mindset can bring. New business and operational models—from “everything as a service” (XaaS), to circular business models, to systems thinking—will be supported by advanced modes of information sharing, collaboration and intensive analytics.

Going forward, organizations won’t find satisfactory solutions in isolation. Rather, they’ll need deeper collaboration through tech-enabled ecosystems that pool ideas, opportunities, capabilities and risk.

Organizations can prepare for this increased collaboration by empowering dedicated teams to swarm around a specific challenge, and connect these teams with other industry partners and innovative startups to unlock new insights about the art of the possible. Using systems thinking (mapping the impact of business decisions beyond the immediate next step in the supply chain and optimizing processes with objectives that extend to the benefit of a larger subset of players), businesses can also improve the value and effectiveness of their collaborations.

  1. Consumer empowerment: Understand the newly conscious, self-reliant consumer.
    The old customer relationship is broken. Consumers not only want to be known by the businesses they interact with through personalization initiatives; increasingly, they also demand agency over the formulation of the end products they buy, the services they consume, the choices they make, and the experiences they choose. Businesses need to provide the transparency, trust and control consumers increasingly demand.

Rather than placing consumers at the receiving end of the product development process, forward-thinking businesses are including them as partners in co-creating goods and services. The result: an end product completely suited to their lifestyle and principles, from reducing their environmental impact to getting the exact product for their needs or tastes.

This shift is already underway. Through social platforms, consumers are becoming more influential than traditional marketers, building and marketing their own content and even physical goods. Businesses must respond and prepare by identifying whether their current market segmentation offers enough insight about their customers’ values to engage them in a hands-on co-creation process. They should also consider which technologies could make it easier to obtain consumers’ input at different parts of the value creation process and product lifecycle.

  1. Purpose: Promote and support a sense of purpose and belonging.
    Shareholders, regulators and consumers are asking institutions to tap into a deep sense of purpose to persevere and thrive in a world redefined by illness and natural calamity but also refreshed by technological advancement and innovation. Attracting the next generation of talent and building closer relationships with customers will depend on developing and acting on a corporate ethos that guarantees workers of all stripes a supportive work environment.

In the net zero era, businesses seeking to attract and retain top talent must adequately invest in the planning, preparation and execution phases of hybrid work. A major piece of this strategizing will center on developing role-specific work-location strategies.

Using a heads-up/heads-down model, work-redesign teams can estimate how much of a given role’s time and responsibilities are spent on activities that are best facilitated in-office or remotely. The resulting flexible work structures should be customized, best-fit arrangements, based on employee input and guidance, and a work assessment based on activities instead of functional groupings.

Meanwhile, the physical workplace will become not just a place work gets done but an attractive place to mentor and be mentored, collaborate, exchange ideas, and develop cultural cohesion and a sense of shared purpose.

Facing the challenges of the net zero era will require targeted investment, innovative thinking and quick action. The pandemic has brought down the curtain on digital’s first act, and now the second act is about to begin. A new era is unfolding—the net zero era. This is the Future of Us.


Determining “nonnegotiables” in the new hybrid era of work

As businesses look for ways to move forward in a rapidly changing world, it seems that everything is in flux. “It’s a new era, one that’s focused on hybrid and new ways of working,” PwC’s recent workplace pulse survey reported. People are “all over the map” in terms of where they want to work—at home, in the office, or any combination of the two. At the same time, companies large and small are grappling with decisions over which mode of work makes the most sense for their business and their people.

In those industries in which remote and hybrid work is possible, flexibility is essential to attracting and retaining great employees, particularly amid low unemployment. “We are both seeing the fiercest labor market of our lifetime and employees making demands in terms of how they want to work, where they want to work,” said Harvard Business School professor Tsedal Neeley earlier this year. “So they do hold the power today.”

The current moment presents an opportunity for businesses to develop new arrangements: helping employees find the work experiences they seek and aligning new modes of operating with new people strategies. As Denise Hamilton noted in strategy+business, instead of a “great resignation,” there could be a “great renegotiation.” Of course, the need to negotiate new ways of working does not negate any of the absolute necessities for businesses to succeed. In advising companies, we have found that it is crucial to determine which facets of the work experience are “nonnegotiable.” (In this context, we use nonnegotiables to mean elements that must be strong within the organization. The flexibility of hybrid work brings benefits, but it must not damage these elements.)

Though nonnegotiables may differ somewhat from organization to organization, many of them apply to most businesses. We find it’s helpful to break them into four major categories.

A pyramid chart groups four categories of “nonnegotiables” in a hybrid work environment, applied to individuals, teams, customers, and communities.

The biggest category is nonnegotiables for the individual. There’s no higher priority for organizations than recruiting and retaining highly skilled workers. But in the hybrid era, organizations face something of a catch-22. “If businesses insist that people return to the office, they risk losing talent,” PwC US’s Governance Insights Center has noted. But at the same time, “if they let employees stay at home, they may have to grapple with maintaining a culture that was established onsite.” And, as PwC’s 2021 global culture survey found, cultural cohesion is important for ensuring employees feel connected to the workplace.

Meet the four forces shaping your workforce strategy
Businesses that are open to having top-notch, diverse employees as part of their team, regardless of where those employees live (or need to live for personal reasons), benefit. Businesses also must make sure their top picks are saying yes when given job offers—and are still with the company years later. This means closely tracking the experiences of prospects, new hires, and existing employees; learning why potential hires turn down jobs and why existing employees leave; and continuously working to improve both recruitment and retention.

It also requires close support of each employee’s growth through mentoring and skill development. In a 2019 article on training and development, the University of Massachusetts Global cited a survey in which “60% of respondents said they’d choose a job with strong professional development opportunities over one with regular pay raises.” And the following year, in the Harvard Business Review, Margaret Rogers, a vice president at consulting firm Pariveda Solutions, called more effective development programs the “most obvious solution to upping employee retention.”

Connections between colleagues are crucial for building teamwork, collaboration, and morale—and increasingly, productivity. These connections have also taken a hit during the pandemic, according to a study by Microsoft. And in a 2021 PwC pulse survey, chief marketing officers said their top concern was the potential loss of innovation stemming from diminished teamwork. The survey analysis concluded that technology, including “tools that enable collaboration at a distance—as well as tools that put the right data in front of the right people at the right time,” can help to mitigate the loss. Relationships and interactions can also be improved through use of cross-functional teams and peer coaching.

Prioritizing development on both the individual and team levels is also a nonnegotiable because of the challenges presented to organizations by skill gaps. “Half of all employees around the world will need reskilling by 2025—and that number does not include all the people who are currently not in employment,” PwC Global Chairman Robert E. Moritz and World Economic Forum Managing Director Saadia Zahidi wrote in the 2021 report Upskilling for Shared Prosperity.

Other nonnegotiables involve how your business connects with its current and potential customers. If customers feel ignored or underserved, they’ll bring their business elsewhere. Amid the current labor market churn, this has become a growing problem. CMOs report that current staff shortages are having a negative impact on the customer experience, with 40% citing it as a major issue.

As organizations test out possibilities for hybrid work, they need to ensure that staff are still having genuine, relevant interactions with prospects and new customers, while also nurturing existing customer relationships. For example, a business might need staff to travel to the office or to a client site for events celebrating customer milestones. Depending on what the client prefers, this could be an example of a time when a “Zoom party” just wouldn’t cut it.

Finally, it is critical to consider the implications of the hybrid work model on the broader community. More than ever, all stakeholders in a business—including its employees, its customers, its investors, and those who live in the same cities as its facilities—are looking for companies to take action on major social and environmental issues. They want to see organizations involved in the community.

The 2022 Edelman Trust Barometer found that “all stakeholders hold business accountable.” Personal beliefs and values now help determine which brands 58% of customers buy or advocate for, which companies 60% of employees choose to work at, and which businesses 80% of investors choose to put their money into. Having a prominent, active voice in addressing the biggest challenges of our time has become a business imperative.

So, as organizations experiment with hybrid work options, it’s crucial that they also examine their impact on communities and show a strong commitment to helping lead the way in creating positive change. Through employee surveys and other workforce engagement metrics, as well as regular check-ins between managers and their reports, executives can keep close tabs on all these elements and make sure the organization is advancing on them.

As businesses look to navigate through this time of profound change, there are no one-size-fits-all answers. The needs of all the different groups we’ve discussed must be balanced against one another—and those needs will keep changing, too. But, as long as your business knows what its nonnegotiables are, you’ll know which factors to keep a close eye on. And you’ll be in a strong position to chart a new path forward.


The importance of providing mental health support for staff

Mental health has dominated the headlines since the pandemic began. Uncertainty, anxiety and loss have affected many of us over the last 20 months and resulted in an increase in demand for mental health supports and services.

This experience has been no different for global workforces, many of whom shifted to remote working overnight and are now navigating a new hybrid model of working which is being interrupted by further restrictions as new variants emerge.

According to multi-market research we recently carried out with Ipsos MRBI, employers have more to do when it comes to supporting their staff’s mental fitness.

Just two in five employees feel that the resources provided by their employer during the pandemic have been sufficient to support their mental health.

Support for employees’ mental health:

HR calls for more wellbeing support after coronavirus

HR spends a third of time on mental health support for employees

How wellbeing initiatives have boosted employee engagement post-pandemic

The need for employees to have access to quality services to support their mental fitness and health has never been greater.

Employers have an opportunity to address this and reassure their staff that they will be there for them, through good times and bad.

Tailored supports for staff

When it comes to addressing mental health issues there is no one-size-fits-all solution.

Every workforce is made up of individual employees that have different levels of comfort when it comes to accessing and using different resources.

Employers need to consider the diverse nature of their specific workforce. Factors such as access to private space in their homes and familiarity with using apps and digital services all play a part in how employees view and use the resources offered to them.

According to our research, the top five supports most valued by employees are:


Digital team get togethers

Counselling services

Extra time/days off

By providing a menu of options for staff when it comes to supporting their mental fitness, both in person and online, employers can be sure to connect with staff from all demographics and meet various accessibility issues.

Lead by example

Our research indicated that most individuals are more comfortable talking to family and friends about their mental health than their employer.

Only one in 10 respondents feel comfortable talking to their employer, as opposed to six in 10 comfortable speaking to family. This may be because staff fear negative repercussions if they open up about their mental health struggles to their employer.

So there is a responsibility for employers to lead by example and normalise conversations around mental health in the workplace.

By having open and honest communication from the top down, employees can feel safe to share their own experiences without it impacting their career.

Greater awareness of the services available through employee assistance programmes (EAPs), like counselling, is also needed.

We witnessed an extremely low uptake of EAP services during the pandemic, which is surprising given the pressure people have been under during that time.

Staff need to be reassured that this is a completely confidential and free service that is there to help them through both physical and mental challenges and EAP contact details need to be easy to find and frequently communicated. Staff may also need further information and education around the different life scenarios where counselling can help.

The past 24 months has brought about an unprecedented amount of change to the personal and professional lives of people across the world and the conversation around mental health has, thankfully, been front and centre.

There has never been a better time than now for employers to step up and support their employees through all of life’s ups and downs.


Growth-Support Professionals Are Key To The Future

Professionals with the skills to support short-term growth are the big winners in the immediate aftermath of the pandemic, according to new data analysis.*

With nearly three-quarters (73%) of senior business leaders reporting that they are more confident in their growth prospects for the next 12 months than the 12 months prior, many are investing in talent that can enhance growth strategies, pushing up demand and subsequently salaries in some sectors.

Robert Half experts reviewed salary data from thousands of placements across more than 200 finance and accounting, financial services, technology, HR and marketing roles, finding that median starting salaries for professional services roles have increased by 4.9% over the past six months.

Businesses are hitting the ground running with revised growth strategies that include increasing headcount, driving customer growth and supporting demand. Analysis reveals that the four areas experiencing the highest wage growth over the past six months relate to these plans:

HR (+24.5%)
Businesses are increasing headcount to drive growth, and to manage hiring processes and onboarding they require talented, experienced HR teams who are able to make great hires at a fast pace

Marketing (+8.6%)
Including design, digital, marketing and communications, these professionals are responsible for increasing awareness, consideration and action, which is essential to driving customer growth and loyalty

Business intelligence and data analytics (+7.7%)
Data analytics and business intelligence experts provide information that identifies focus areas for growth, providing insights that can support hiring and marketing strategies, and ensure that businesses are using their resources effectively

Software development and testing (+7.2%)
Business leaders are preparing for increased customer volumes by working with DevOps professionals to strengthen and overhaul systems. Ultimately, organisations need sales of their products and services, which means they must be able to handle heightened demand

Commenting on the highest median starting salary increases, Matt Weston, Senior Managing Director for the UK, Ireland, UAE and BeNeLux, said: “Having been amongst the first to be cut during the pandemic, HR and marketing roles are now being created and backfilled at incredible pace, creating voracious demand with limited supply.

“These roles, along with analysis and DevOps roles, are on the front-line of business growth, supporting demand generation and helping to manage increased customer demand. However, the immediacy of the need is likely shielding more consistent demand in compliance and digital transformational roles.”

Despite the significant increases in the areas of the technology sector above, the sector average increase was 4.8% over the past six months, reflecting more consistent demand for skilled tech talent.

While businesses may be focusing on short-term growth, long-term transformation projects designed to extend digital capabilities and futureproof organisations are continuing in the background. Technology median starting salaries for technology roles have increased by 4.8% in the past six months, but salaries for tech transformation roles have increased by 6.9%.

Matt Weston added: “Steady business growth through technology is a long-term strategy for many businesses, and as they continue to digitise and automate, and improve systems already in place, technology talent will stay in demand. However, skills are, and always will be, in short supply.

“The pace of technological development means that tech professionals must constantly update and learn to ensure their skills stay relevant, and therefore there is always a slight lag – and those ahead of the curve are able to command higher salaries as a result.”

Functional, but still essential roles remain in high demand – for example within the finance and accounting, and financial services sectors. However, salaries within these sectors are not enjoying the same meteoric increases as others in professional services. Median starting salaries in finance and accounting creased by an average of 2.5% in the past six months, while starting salaries in financial services increased by 0.5%.

*Data for the study was collated for an update to Robert Half’s 2022 Salary Guide, which includes salary data for more than 200 roles by region, as well as analysis on the latest hiring trends across the UK.


Workers Facing Inflexible Office Returns Are Stressed Out And Anxious. Their Bosses? Not So Much.

A new survey shows full-time office mandates are tied to lower worker experience scores. Companies such as Hewlett Packard Enterprise, Atlassian and State Street share ideas for making different hybrid models work.

s the pandemic threat recedes and more employers call workers back to the office, new data from a survey of 10,000 workers describes a “troubling double standard” in the realities that employees and their bosses face, with non-executives showing much steeper declines in measures of work-related stress, anxiety and work-life balance.

Future Forum, a research consortium on the future of work launched by Slack and other partners, released on Tuesday its latest Pulse survey of 10,000 knowledge workers globally. The consortium, which also spearheads a working group of executives to discuss future workplace issues, found that non-executives are nearly twice as likely as top managers to work from the office every day, and their work-life balance scores are now 40% worse than executive respondents. Workers also reported more than twice the level of stress and anxiety as top bosses.

There was also a sharp divide between the employee experience scores of workers who have full-time in-office mandates and those who have hybrid or remote options, with declines twice as steep for full-time office workers when it comes to work-life balance and 1.5 times as steep for scores on stress and anxiety, the survey found.

“Executives are embracing flexibility while they’re telling everybody else to come back to the office,” says Future Forum vice president Sheela Subramanian. “What we’re seeing is just a lot more rigidity, more top down mandates happening and executives are not necessarily setting that model from the top.”

Meanwhile, Subramanian says, the overall declines in employee experience scores since its research last quarter come as some companies are requiring workers to revert to pre-pandemic approaches to office attendance. The new survey found that 34% of knowledge workers have gone back to working in the office daily, the largest share since the consortium began its research in June 2020.

Yet recent weeks have seen a wave of companies launch their hybrid returns to office, with many introducing policies that range from a few days a year to a few days a week onsite. At Overstock.com, most workers’ in-office mandates will be limited to a few days in the spring and late summer. Apple is easing workers in with a requirement of one day a week, which will grow to three days a week starting in May. Google has also said it expects workers to be in the office three days a week.

At Hewlett Packard Enterprise, which officially reopened its offices April 4, about 80% of its workforce is designated as hybrid, with no mandate for the number of days they should be in the office. These employees, as HPE CEO Antonio Neri wrote in a recent blog post, will be “working primarily remotely but encouraged to come into the office for collaboration.”

The company’s chief people officer, Alan May, says that HPE is doing more to articulate when those collaboration times might be. For instance, the tech firm asks leaders to meet with their employees every couple of months for targeted career, strategy and performance-metric discussions.

“We’re encouraging all of those to occur face-to-face where possible, in the office,” May tells Forbes. Collaboration events, meetings with customers and meetings designed to recognize workers should also be done in person, he says. Yet at the same time, there’s “certainly not an edict or a quota on the number of days people have to show up,” he says.

Still, May says, they’re trying to make the office a draw, with a new headquarters in Houston that includes make-at-home meal kits to take home, large outdoor screens for movies, onsite health and fitness facilities and a pop-up “makerspace” with equipment like 3-D printers for workers to dabble in their own projects or attend workshops with peers.

Of the “makerspace,” May says, “it’s an additional amenity that I think, frankly, is a lot more thoughtful than just another foosball table.” People are excited to be back on the new campus together, but that doesn’t mean “they suddenly jumped back in five days a week,” he says. “I think those days are gone.”

“Actually I don’t think you come together to work. You do the work remotely. You come together to build social bonds.”

—Atlassian cofounder Scott Farquhar
Future Forum’s Subramanian agrees being flexible doesn’t necessarily mean there’s no role for the office. Despite all the focus on where people will be working, their new survey showed that when employees are expected to work may be even more important to workers than where. While 79% of respondents say they want location flexibility, 94% say they want to be able to choose the hours they work.

When making plans for coming together in person, she says, companies should create team-level agreements for a set of core hours and be “really intentional about why you’re getting together—rather than ‘you need to come into the office so I know that you’re working and responding to my messages quickly.’”

“Intentional” is exactly the word Scott Farquhar, Atlassian’s cofounder and No. 123 on our 2022 billionaires list, used when describing his software company’s strategy recently. In an interview with Forbes, Farquhar said details are still being hammered out, but he expects the direction to be that employees who don’t live near one of the company’s offices will travel about four times a year for what he calls “intentional togetherness.”

He says he doesn’t call it working together “because actually I don’t think you come together to work. You do the work remotely. You come together to build social bonds.” When people come together, “I think it does look much more like a conference you go to.”

At Atlassian, the company allows people to work anywhere as long as three criteria are met: They’re legally allowed to work there, the company is legally allowed to employ them in that location, and the time zone works for their team, wherever people are based. Farquhar said about 10% of the company’s U.S. employees have moved states over the past 18 months, and 44% of its new hires in the U.S. in the past year live two or more hours from one of its main office locations.

Subramanian says it’s critical for companies with hybrid policies to set “behavioral guardrails,” as it’s “very easy for things to become inequitable.” That goes for executives, too. Ben Langis, head of workplace of the future at State Street, which has announced a hybrid work plan, says the giant asset manager has asked senior leaders to model the expectations it has for employees around working hybrid, and offers managers training on this new approach to work. “Everyone has to realize this is a large social experiment,” Langis says.

At Atlassian, where its Trello team has always had a remote-first approach to Zoom calls, if one person is remote, everyone else is join calls that way, too. That includes Farquhar: He once flew in from Australia for a town hall meeting at Trello’s offices but conducted it from a phone-booth sized room since some employees were dialing in remotely.

“I call it the Brady Bunch mentality,” he says. “Everyone has their own little box.”


A Fast-Growing New Player In Coaching And Development

The corporate coaching market is on fire. Today more than $360 Billion is spent on all forms of corporate training (average company spends around $1,400 per employee per year) and you can add an additional $300-500 per year on coaching. The result is a massive market, one that might be over $450 Billion or more.

Why all this spending? Companies are desperate to provide more personalized development for employees, and quite frankly, coaching networks work very well. Instead of paying $1000 an hour or more for an executive coach, you can give employees personalized development through a platform like BetterUp, Torch, SoundingBoard, Bravely, or CoachHub and they get personalized coaches for a fraction of the cost.

And the demand is growing. A new study by MetLife shows that almost 70% of employees are burned out and overworked, the highest they’ve ever seen. Traditional training programs simply cannot address this issue: employees need personalized coaching and mentoring to help.

Torch: A Pioneer With A New Approach

The current leader in this market is BetterUp (now valued at over $4.7 Billion), an aggressive company with many advanced offerings. But Torch, a disruptive competitor, is taking a new approach.

Torch was founded by Cameron Yarborough, an executive coach who wanted to add more value to his clients (interestingly, Alexi Robichaux, the CEO of BetterUp, was also a coach). Cameron partnered with Keegan Walden, a clinical psychologist and behavioral scientist, to build a platform that embeds coaching into an organization’s development programs. Through their acquisition of Everwise (a pioneer in mentoring networks), they now offer an integrated platform that combines coaching, mentoring, and digital learning into structured programs for a variety of use-cases.

Let me explain how it works. Most coaching providers can assess employees, assign a coach, and deliver and manage coaching experiences. While Torch does this too, at its core it is a “program-centric system.”

You can design programs with Torch (e.g. manager training, HIPO programs, DEI programs, onboarding), embed various forms of content (e.g. LinkedIn Learning courses, LMS content, articles, quizzes), and then add content and mentoring on top of these experiences. This makes any learning program even more personalized and sticky.

In a sense, Torch is a new type of content development solution. And since the platform embeds coaches and mentors (I’ll show the difference between coaching and mentoring below), the programs can focus on behavior change, not just education.

And to better align with an organization’s needs, customers can add their own leadership competencies, cultural values, and other forms of strategic content.

Most leadership development programs focus on topics and information. With Torch you can help leaders “directly change behavior” in a way that aligns such changes to the company’s culture, strategy, or initiatives.

FICO, for example, uses Torch for its senior leadership development programs. People watch videos, take courses, self-reflect, and embark on directed coaching programs during the experience. Torch, like BetterUp and others, gives people a 360 and helps them identify their weaknesses. The platform then uses this information to create a structured learning journey, designed specifically to build on strengths address the gaps.

While BetterUp continues to lead the coaching market, Torch is carving out a powerful niche. Zendesk, which is a BetterUp customer, uses Torch for its inclusive leadership program called “Ignite.” The Ignite program combines multiple modalities, mentoring, group coaching, and online learning, supplemented with C-Suite fireside chats and masterclasses.

As you can see from the flow chart below, this is a pretty interesting solution. A new manager can build self-awareness, meet in a group coaching event, create their career journey, and then meet with an individual coach for support. And this blended model works:

95% of employees who participated in the program reported high satisfaction with their mentor pairing and mentoring experience, and 91% saw an increase in their motivation to take on more responsibility and own their careers. More than 80% of managers found the group coaching sessions useful and engaging.

What does this tell us? The coaching market is starting to mature. Some companies want an end-to-end coaching solution for all employees, focused on democratizing and personalizing development. Others want a more architected solution, where coaches and mentors are integrated into programs that are aligned with organizational initiatives, competencies, and values.

Lots Of Innovation In Leadership Development Is Needed

The market for leadership development and soft skills (we call them PowerSkills) is massive. While traditional vendors like DDI, Harvard Publishing, Skillsoft, Franklin Covey, Ken Blanchard, and others have been around for years, today companies are desperate for highly personalized solutions that can drive meaningful behavior change. Coaching networks, which have exploded as important disruptive systems, are disrupting the market in an important and exciting way.


Going Beyond Budgeting

Is it finally time to slay the three-headed corporate budgeting monster? Many CFOs we talk to think so. They question the effectiveness of a rigid process often fraught with internal conflicts as they try to build resilience and improve agility when responding to unforeseen events. New heights of volatility and uncertainty unleashed by COVID-19 have pushed their frustrations to the boiling point. The C-suite is more open to change than perhaps it has ever been.

Among CFOs, alternative approaches to budgeting are getting a lot of attention. In particular, Beyond Budgeting, a concrete alternative to traditional budgeting, is gaining mainstream traction. The approach is producing impressive results at a growing number of global companies, including Handelsbanken, Bayer Pharmaceuticals, Volvo, Equinor, and Roche Pharmaceuticals. Moreover, a December 2020 BCG study confirmed that Beyond Budgeting has significant benefits: 59% of 174 finance executives surveyed reported increased sales, 56% saved significant costs in the budgeting process, and 41% freed up formerly held back financial resources. At the same time, respondents reported important improvements in organizational effectiveness, such as better business decisions (52%), more effective performance management (51%), and greater agility in reallocating resources (45%).

Traditional budgeting is like trying to square a circle, because the process tries to meet three ultimately incompatible objectives. (See Exhibit 1.) First, budgeting sets targets to motivate and promote performance. These targets require directional and stretch goals. Second, budgeting provides forecasts of what lies ahead, but the forecasts only work if they are realistic, unbiased predictions. Production, for example, has to know what the expected sales are, as opposed to the stretch targets that sales strive to meet. In addition, the timeframes for useful forecasts can often be longer or shorter than the one year set by most budgets. Third, budgeting allocates resources by setting boundaries around future spending so that management can control costs and intervene to cut them when necessary. The C-suite typically tries to ensure that resources are allocated to the most value-creating opportunities while preserving short-term agility.

Given these conflicting objectives, it’s no wonder that companies often fail to achieve them with the same instrument at the same time. The traditional budgeting process leads to a long list of problems and challenges, ranging from the significant cost and effort required to create the budget to counterproductive motivations, unrealistic targets, gaming, and year-end spending fever.

The Beyond Budgeting movement has distilled 12 principles that form the basis of its approach, 6 regarding leadership and 6 regarding management processes. (See “The Principles of Beyond Budgeting.”) Together, they are meant to help organizations create a comprehensive and consistent new steering model. Companies that have implemented Beyond Budgeting have slain the corporate budgeting monster. They have stopped traditional budgeting and achieved each of the three objectives separately and in new ways.

With Beyond Budgeting, companies still set targets, but they are typically directional, relative, and established by the business units themselves. The level of detail is also much lower than that of a typical budget.

Top-level metrics, such as revenue, EBIT, or ROCE, are all effective targets, especially when compared with peers and complemented with relevant nonfinancial metrics. Ratios, such as unit costs, are typically more meaningful than absolute numbers. A company can instill stretch motivations by defining targets relative to internal or external benchmarks. These targets motivate and steer performance by articulating a clear purpose, ambition, and strategic direction. Roche, for example, places a strong emphasis on openly communicating strategy as a guardrail for performance. Ultimately, a strong performance culture guides day-to-day decision making.

Targets should have time horizons dictated by need and circumstance: shorter if there is urgency (a turnaround situation, for example) and longer if required by goals or complexity (entering a new market or starting a new venture). End of December deadlines become the exception more than the norm.

Some companies go even further. Handelsbanken, a Swedish bank with 700 branches in multiple countries, does not set targets. The company aims to deliver return on equity higher than the average of its competitors, and it has achieved that goal every year since 1972—two years after management booted the budget. Branch performance is measured not against targets but against comparable branches—on cost-to-income ratios, for instance. Alternatively, a branch might set a target itself. The branch managers are trusted to know best how perform well against peers. To avoid unhealthy internal competition, there are no individual bonuses, just a common bonus scheme for all employees, driven by the bank’s performance against the competition. This stimulates collaboration and sharing of best practices across the bank.

We all know what happens when leadership asks for revenue projections from unit managers who are fully aware that the number they submit will serve as the basis for a target, often with a contingent bonus attached. Or when finance requests capex and opex numbers, and everybody knows that this is their one chance of getting access to next year’s resources—and that whatever number they submit will most likely be reduced. A forecast should be neither an opening bid in a target negotiation nor an application for resources. Forecasting should be its own separate process, dedicated to producing a realistic prediction of future performance.

The distinction between targets and forecasts becomes clear when the first forecast is completed. If it is below target, that does not mean the target cannot be met. Rather, the unbiased information that the forecast provides serves as a basis for determining the actions required to achieve the target. Finance has an essential role to play in framing and preparing management discussions accordingly.

The objective is to support good business decision making in areas such as short-term production capacity planning or long-term investment approval. Forecasts should be made for the time horizons relevant to the decisions at hand—which are not necessarily one year—and they should be updated as often as needed. Because the outside world moves quickly, most companies need to look ahead more frequently than once a year—at least quarterly, if not more often. Many companies use quarterly rolling forecasts with a five-quarter time horizon. Usually, forecasts are less granular than in prior budgets, because they are not conducted as a detailed, bottom-up exercise.

Best-in-class forecasting leverages algorithms to create unbiased predictions and provide managers with solid feedback on the impact of actions and initiatives already underway. Daimler Mobility has built a forecasting engine to produce monthly high-quality forecasts without expending prohibitive amounts of extra effort. Leaders are allowed to overwrite the algorithmic forecast to reflect information that the central engine was not able to incorporate. Changes in forecasts show whether an initiative actually affects performance. They foster discussions that focus on needed forward-looking action rather than on explanations or excuses for past results.

Some companies—such as the energy company Equinor—have switched to dynamic forecasting, which operates around a few predefined time horizons. Forecasts are created when circumstances change, and they support specific business decisions. Local units renew their forecasts when something happens that they believe requires an update. A common forecasting database enables the group to aggregate a companywide forecast, when needed, by tapping into the latest data.

Instead of defining rigid, top-down spending envelopes a year in advance, companies that use a Beyond Budgeting approach address resource allocation by combining broad target setting with better reporting. This allows them to delegate detailed decisions to the operational level, where the understanding of what’s required is clearest and resources can best be allocated in an agile way. Management can also issue burn-rate guidance that provides clarity on recommended cost levels.

More freedom and flexibility come with more accountability. To control and safeguard performance, finance sets up a transparent performance monitoring process that allows for quick intervention if needed. Reporting numbers in accounting-like detail usually does not achieve performance transparency. Instead, ratios, trends, and benchmarks for key business drivers provide easy visibility into where costs are moving in the wrong direction. For example, control charts, which track actual results against a trend or an average, are an effective way of monitoring cost development. Variances are investigated if they move outside of statistical control limits, effectively distinguishing signals (to be probed) from noise (to be ignored). Discussions between finance and managers should move from the descriptive (“Costs have increased by 20%”) to a focus on the drivers of costs and what can be done about them.

A company that uses Beyond Budgeting allocates capital dynamically rather than a year in advance. It typically replaces the traditional capex budget with a more continuous decision process, which also keeps one eye on the latest financing capacity forecast. In this way, the bank is always open to funding promising ideas or ventures.

Transparency on spending can become a “social” control mechanism that is highly effective at keeping value-destroying costs at bay. The Norwegian IT company Miles, for example, has no budgets (and no targets), including for travel and training. Employees can attend any course or conference they want. But when they return to work, they have to post on the company’s intranet where they went, what they did, and what it cost. Similarly, Netflix’s expense policy does not focus on detailed budgets but consists of a single sentence: “Act in Netflix’s best interest.” Expense transparency reveals any misconduct and ensures that people adhere to this principle.

Abandoning traditional budgeting is more of a journey than a one-time decision. We recommend a three-step approach: create the case for change, separate the budget objectives, and improve each process individually. (See Exhibit 2.) There will also inevitably be barriers to overcome.

Articulate the case for change. Most companies start by identifying all the issues that managers have with the current budgeting process using surveys and interviews. The results can make for surprising reading for the executive team, as pain points turn out to be not merely irritating but symptoms of larger systemic issues.

Management needs to define a clear vision of what it wants to achieve and how Beyond Budgeting can solve identified challenges. This will provide motivation for the business and finance teams tackling difficult change and ensure that all the various measures are moving in the same direction.

Separate and improve. Separating the three budgeting objectives is the next step. CFOs need to establish distinct processes and practices for each one—target setting, forecasting, and resource allocation. One of our clients renamed the existing forecast “Predict” to ensure a common understanding of what those numbers really mean. For those that find it nearly impossible to operate without a budget, remember that all the purposes of a budget will still be fulfilled—but in much more effective ways.

To make this kind of journey bear fruit, finance executives need to adopt a systems-thinking approach. Reducing the granularity of targets is only possible with better reporting, for example. Without performance transparency, management will have a hard time delegating responsibility. Changing processes can require changes in leadership style and the promotion of new values such as empowerment, trust, openness, and transparency. Consistency between words and actions, between management’s messages and management processes, is essential. Preaching autonomy and empowerment has little credibility if people remain bound by detailed travel budgets.

Overcoming the barriers to change. Organizational changes are always challenging. The three biggest barriers to implementation of Beyond Budgeting cited by executives in our 2020 survey were concerns about higher costs (46%), implementation risks (44%), and limited board support (33%). These concerns need to be addressed.

Concerns about higher costs arise from the management myth that without budgets, costs will rise and performance will suffer. The truth is that value-added spending might rise. It’s common to see a change in the cost mix, from less value-eroding costs to more value-creating costs. Also, if managers no longer need to maximize budgets in negotiations, the incentives that lead to year-end spending fever disappear. Many companies actually report cost decreases once the budget floor is abolished. In 2020, a public-sector organization in Norway ran a pilot allowing two of its units to operate without cost budgets. Because of COVID-19’s impact on travel and external activities, costs fell in all units, but none dropped as much as in the two pilots, which reported declines of 50%.

As for implementation risk, history shows that very few organizations go back once they have started, which should be a clear indication that this risk is low. And if things should go wrong, the old process can be quickly reinstated. No one will have forgotten how to budget. The downside risk is minimal compared with the huge upside potential.

We also recommend applying an agile approach: prototype, test, learn, and adjust. Run pilots in certain business units, if relevant. This will ensure demonstration of early benefits via quick wins, which in turn will create buy-in for more daring changes.

A skeptical board is an understandable concern. But this is often fueled by a second management myth: that budgets provide control. In fact, while having the next year described with accounting precision might sound safe, the only thing we know for sure is that the budget will be wrong. The fact that variances can be explained does not mean that managers have control. More often than not, variances are caused by bad planning assumptions or unforeseeable events. Detailed budgeting a year in advance can actually undermine the agility that many boards strive for in the current business environment. Beyond Budgeting gives CFOs the opportunity to make their companies more agile.

Finance is often the greatest enemy of Beyond Budgeting, which challenges its traditional role and accustomed practices. However, practice shows that the Beyond Budgeting approach actually makes finance people’s job much more meaningful. While the overall effort does not necessarily change, the work becomes more future- and business-oriented. The usual autumn sprint is replaced by a more continuous, and arguably a more manageable, process.

Beyond Budgeting has proven to be not only effective, but in many ways superior to traditional processes. This is especially true in today’s uncertain and volatile business environment. Many large organizations have successfully made the change. It is also a model that can serve as a window into what future financial management can look like. But remember: Beyond Budgeting involves not just a change in process but also in how management thinks about the future and about managing people. Managers shift from politburo-style central planning and command-and-control decision making to directional guidance, delegation, and trust. CFOs should plan carefully for the change and the journey.