How can leaders repair the damage the recession has done to trust and morale?
Dr Simon Hayward, CEO, Cirrus and JB Aloy, Executive Director, Employer Branding and Employee Research, Ipsos MORI write for The HR Director
The recession has had a negative impact on employee engagement. There has been a widespread erosion of trust. Despite economic recovery, there is still a great deal of uncertainty. Economic upheaval forced many organisations into patterns of short-term thinking as long-term planning became too difficult in a volatile climate.
Research from Ipsos MORI found that investment in employee development, motivation and wellbeing fell by 20% during the recession, and that long-term investment in people is still lagging behind pre-recession levels. So, how can organisations today engage employees in order to boost performance and build a sustainable, successful future?
In answering this question, one key area is clearly how the leaders set the course for the business. Cirrus developed a framework of ‘Connected Leadership’ based on five themes that are all critical to a company’s long term success and sustainability. These are:
• Creating a shared direction and purpose across your business
• Being authentic and creating a shared values-based culture
• Involving colleagues across the business in devolved decision-making
• Building teams that collaborate effectively across the business
• Being agile in the face of changing circumstances facing your business
Connected Leadership embodies the shift away from the old style of command and control leadership and hierarchical structures. It is about leading through influence, deeply engaging employees with a shared purpose and direction, and devolving decision making across the business.
For Connected Leadership to work effectively, a successful relationship between HR and the C-suite is critical. Connected Leadership requires a high degree of trust, not only between HR and the C-suite, but across the entire organisation – trust that each person and team will play a part in the process, and trust that each person and team will seek what’s best for the whole business based on a shared purpose.
Together Cirrus and Ipsos MORI explored how the five-factor model of Connected Leadership resonated with the senior business leaders of Corporate Britain in a major research initiative, Leadership Connections: How HR deals with C-suite leadership. We interviewed C-suite leaders and HR directors from many of the UK’s biggest organisations to discover which factors were most important to them. We also asked C-suite leaders where they needed most support from HR, and where they felt HR is currently most effective.
We found that Britain’s business leaders are alert to the risks of short termism. A recurring theme was the need to build for the future in order to deliver sustainable growth. The biggest priorities, shared by almost two thirds of leaders, are making sure their companies are agile and have a sense of shared direction. Just over half prioritised collaboration and creating shared values.
The area where C-suite leaders most want HR to do more – supporting business agility – is also the area where HR has the greatest opportunity for improvement.
When we spoke to HR leaders, the weight of attention was also on the need to be agile. This was seen as an important end in its own right, especially given the increasing demands from customers, and the increasing challenges from competitors and new entrants. As Tanith Dodge, Director of HR at Marks & Spencer commented, “Everybody wants everything now. The customer is much more demanding in our digital world. You’ve got to be agile, you’ve got to be fast, and you’ve got to have speed to market, to turn things around quickly. Customers expect access to everything immediately so you’ve got to have that agility.”
So how do you embed this long term capability to be agile? By engaging people, giving them responsibility, and encouraging new ways of working in our digital age. Angela Spindler, CEO of multichannel retailer N Brown, said that, “Although the need for agility is fuelled by technology, actually the technology doesn’t achieve anything in itself. It is about changing the way people work, the way they think, the way they view data, the way they interact with customers.”
The elements of Connected Leadership appear central to achieving this change in how people work. We found that each of the other four elements of Connected Leadership are seen as a central part of ensuring the company remains agile. Agility depends on companies being able to respond to challenges quickly – which means people need to be engaged and empowered to make decisions rather than having to refer decisions up the chain and wait for a response. To do this effectively, there needs to be:
• A clear sense of shared direction
• A willingness to trust and collaborate
• Shared values
All of these are necessary to provide a framework and capability for business units to make positive, agile decisions which are in line with what the company’s overall direction and purpose.
Sarah Dickins, People Director, Provident Financial Group, summed up both the challenge and the opportunity: “Because of the rate at which businesses are transforming, there’s a really important role for HR to play to make sure organisations are ready for that change. That’s where HR can really, really add value, because it’s all about the right talent, the right organisational design, engagement strategy in line with business strategy and how connected our people are to the customer, because that customer connection is becoming more and more important.”
By making these critical connections, today’s organisations can deeply engage employees in order to improve performance and build sustainable, long-term success.
© The HR Director 2015