Every founder's and leader's assumptions, strategic plans, and visions for their companies' futures have been profoundly changed by Covid-19. As the virus lingers, its economic impact will affect corporate culture for years. How will things change, and by how much? What must leaders do to best adapt now and in the months and years to come?
Prior to the onset of Covid-19, with the U.S. economy at near-capacity employment, a healthy corporate culture was increasingly viewed by boards and C-suites as essential to a company's ability to grow. Today, new norms and habits have been forged during the crisis. It is too early to tell what the mid- and long-term changes to organizational culture will be, but to be sure, the way organizations work will never be the same. With little to no negotiation between employees and employers when Covid-19 hit, employee safety took priority over productivity in many cases, and friction began to build around the significant consequences for brands, customer experiences, and long-term company reputations.
We recently surveyed a global panel of leadership and culture experts that included military and government leaders, corporate culture icons, academics, authors, and culture analysts along with CEOs of for- and not-for-profit entities to examine the uncertain future and share their insights about what's in store for corporate culture. Complete results and analyses of the survey can be found here. Some lessons:
Virtual work is now probably here to stay in some form. As virtual work becomes the norm, how will culture be built without day-to-day [in person] interactions? This generation of leaders now have more emotional challenges to address in their workforce, including how they will help employees to achieve psychological safety. --Dee Ann Turner, former vice president talent and human resources for Chick-Fil-A, CEO of Dee Ann Turner & Associates
You Go Into the Pandemic With the Culture You Have
Responses from leadership panelists revealed that culture change will likely be slow, even in the midst of a global pandemic (and perhaps because of it). Norms, values, assumptions, and behaviors are often deeply entrenched within organizations and not easily changed.
Analysis showed panelists view three distinct cultural pathways emerging as organizations respond and recover. Each pathway requires that leaders assess where an organization is, plan, and act decisively to drive positive cultural change and restart growth.
This [pandemic] experience has raised the level of importance of having trust in each other to be successful in whatever is the mission of the company. It has also emphasized our interconnectedness as well as our responsibilities to each other. --Jane Delgado, president and CEO of the National Alliance for Hispanic Health
Panelists noted two major risks for leaders interpreting pandemic-related changes to their organizational culture. The first is the tendency to assume the nature of culture changes rather than working to truly understand them in context. The second is failure to bring the full voice of the collective (employees) forward through measurement, which can and will affect performance.
Culture is not something you "fix" like a car or toaster. Leaders must have a disciplined approach to assess and measure the culture at defined periods. This process should inform their strategic plan and supporting priorities. --Tim Kuppler, director of Culture and Organization Development at Human Synergistics International
The survey showed three cultural pathways organizations are likely to be on at present:
- Strengthened and enhanced: Companies that entered the pandemic with a strong, managed, constructive culture will discover a new resiliency that will help them recover faster than others. The crisis can be an opportunity for these organizations to further disrupt or differentiate.
- Adaptive and recalibrating: Company cultures that were already in transformation prior to the pandemic can now be seeded with new possibility and develop adaptive leadership mindsets. For these organizations, the crisis can be a catalyst for evolution or even growth.
- Arrived and deprived: Companies that entered the pandemic with a weak or poorly managed culture will find that the level of improvisation and resetting required is beyond their capacity for change, creating potentially existential risks.
CEOs must consider how their culture will help them navigate the new reality and then take advantage of the strengths of their culture to develop new ways to win in the marketplace." --James Rodgers, founder of the Diversity Coach, leading strategist in the field of diversity management
A Social Contract Under Disruption
In the context of the abrupt and extreme changes to work environments and employee routines as a result of the pandemic, the survey revealed a more fundamental expected reset within the social contract--the spoken and unspoken agreement between employees and employers.
Many workplace policies and practices have been rewired into a new and employer-centric social contract, with neither time nor precedent to guide the negotiation of Covid-19 policies and practices. Unnegotiated contracts create friction and fear, and a wide range of employee protests have emerged in recent weeks--on a small scale, such as refusing to use videoconferencing in an attempt to preserve the line between personal and professional life, and a more public scale, such as employees at a meatpacking plant staging a mock funeral procession. Friction continues to grow as primal needs for health, safety, economic stability, and personal privacy are met with both requests and demands to "return to work" or adapt to a "new normal."
The most important question that CEOs must ask is to their employees: What needs to change to help you be successful in your work? Only when employees feel safe and heard can they begin to make customers feel the same way. --Ginger Hardage, former senior VP of Culture and Communications at Southwest Airlines, founder of Unstoppable Cultures
The broad nature of the contract reset between employees and employers during this crisis leaves much open for discussion and negotiation. Panel member responses pointed to employee health (first and foremost), commuting, teleworking, traveling, office space, training, onboarding, communications, leadership development, technology adoption, corporate social responsibility agendas, market surveillance, and intelligence gathering as most important to reevaluate.
Corporate culture leaders who act decisively on this opportunity to reinvent the workplace social contract can create significant strategic, cultural, talent, and operational advantages for their organizations in a post-Covid-19 market. But it will take time, leadership commitment, and transparency if employers are to find balance and engender trust.
A Pathway Emerges
Humble Leadership author Edgar Schein, a renowned expert in culture change and organizational design, advised, "Leaders must show that with complex, messy, systemic, interconnected problems like responding to Covid-19 or the next pandemic, collaboration must escalate as a central value in producing new, better and innovative adaptations."
Founders and leaders will choose from a myriad of paths moving forward in the weeks, months, and years to come. Regardless of how they move forward, the insights from this survey suggest they do the following:
- Listen with empathy: Create a safe space for people to share their stories and reveal their truths without consequence of judgment to engender trust with actions that exemplify credibility, reliability, low self-orientation, and compassion.
- Measure and gather the voice of the collective: Design a way to gauge your organization's culture to ensure it aligns with what you have heard from employees. This will give confidence and clarity about where your organization stands and where it must go.
- Renegotiate together: Generate the conditions under which culture data insights underpin the renegotiations and cross-functional conversations produce imaginative and innovative agreements.
Daniel P. Forrester, Philipia Hillman, and Eliza McDevitt are with Thruue Inc., an expert consultancy that helps leaders build cultures that drive growth. We partner with clients to assess their organization, align around a story of growth, make strategic decisions, chart a plan for change, and activate its strategy and culture. To learn more visit thruue.com