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July 30, 2020

Has working from home created a culture crisis?

Why employees and management are finding it harder to be engaged

Tara Arndt

Creating and maintaining a strong organizational culture is a delicate, difficult task even in the best of times. Right now, we’re not exactly living in what most would call “the best of times” as we simultaneously deal with a dangerous pandemic and attempt to restart a weakened economy, all while coming to terms with complex social issues.

What we’ve been going through since sometime in first quarter 2020 has forced many organizations to keep employees working at home. At first, this was messy, complicated and confusing with some employees hating the “new normal” and others thoroughly embracing it.

In early May of 2020, Gallup tracked employee engagement and found that it had risen to an unprecedented high of 38 percent. (The average number had been around 33 percent for quite some time.) Performance and productivity was also strong, something most experts had not expected.

But as of July 2020, Gallup discovered that engagement had plummeted to a new low of 31 percent.

Is coronavirus the only cause for the drop?

The current state of engagement is the result of an unprecedented combination of inter-related factors — the protests and riots that came on the heels of the death of George Floyd in late May; unemployment figures not seen since the Great Depression; often premature, sometimes ill-advised efforts to open businesses; and the resurgent pandemic have caused U.S. workers to lose all of the record engagement increase — and then some.

The numbers for workers who are “actively disengaged” — the ones who truly dislike their job and the company they work for to the extent that they openly complain to their colleagues — have held steady from early May through June 2020. So, if they’re not the cause, where is the big drop in engagement coming from?

The largest drop starts at the top

From May to July 2020, engagement levels fell precipitously for people of color, those working on-site versus at-home, blue collar and service employees, and men. (Ironically, a Mercer study found that women are suffering higher levels of stress during this time yet their engagement doesn’t appear to have gone down.)

But the problem really starts at the top: Managers and leadership showed the largest decrease in engagement.

Much of that appears to come from not only the uncertainty caused by the pandemic but from the problems with employees working remotely and the personal issues that  it creates. In addition, managers and leadership are dealing with the fear of returning employees to work safely along with the difficulty in keeping everyone informed and on the same page when they’re not all in one place.

Leaders have always been key to the success of any organizational culture. But now leaders carry more weight than ever in shaping employee perception of the company and, subsequently, their engagement with it.

If, for example, the leader of a manufacturing operation that has been shuttered can effectively communicate a well-thought out, safe plan for reopening, that can go a long way towards reinforcing or developing a significantly powerful culture.

What are employees most concerned about?

A variety of sources have identified the primary issues:

  • Welfare of the family — Are the kids OK? Can they go back to school? Is my spouse or significant other going to be alright? Are my parents safe?
  • Financial concerns — Men are more concerned with the status of their careers and jobs; traditional cultural expectations are still a force in our society
  • Work-life balance — A particular concern for women: balancing workload, family, and worrying about the impact of the pandemic on society overall
  • Lack of support from management and leadership — This is a concern for all employees but more women feel overlooked, unheard and uninvolved in the business

How to bring employees together when we’re far apart

If culture is all about community, how does that work when many employees are working remotely? When people are working together it’s far easier to develop an ongoing esprit de corps that engenders a visibly strong culture. So, how does a leader make that happen when most, if not all, of the employee population is at home? Here are a few basic suggestions:

  • Make sure management talks about the culture — reinforcing it, articulating what the leadership of the company truly values.
  • Never waver from the culture you want to instill. Stay true to it and talk in terms of dealing with the problems brought on by our current situation and rising above them.
  • Find even more ways than usual to recognize employees for their behaviors, attitudes, performance and productivity.
  • Use your video conferencing program for more than company or team meetings. Encourage employees to use it to connect with each other for lunch hour conversations; breaks; exercise sessions; book clubs; or anything that will help bring them together more often in less stressful situations.
  • Ask employees what they need to be successful. The more they feel listened to and appreciated, the better.
  • Talk directly with employees. Find out how they’re doing, what they need, what’s working and what’s not. Focus on their needs and be proactive in addressing their concerns.
  • Then make sure you’re providing them with what they need — the resources and support to help them stay healthy and productive.
  • Communicate often and be as open and transparent as possible. What is going to happen if and when there is a “next phase” of the pandemic?
  • Develop leaders by providing education and coaching, and make sure they are showing empathy to employees.
  • The more resilience you can demonstrate to employees, the more trust they will have in leadership and the company in general. And that creates even more engagement.

Remember, culture is not a “thing” you repair like a malfunctioning machine. It’s an organic, very human construct that results from leaders having the ability to actively assess the quality of the culture and the level of engagement, transparently create strategic plans and priorities to make the culture come to life and sustain, and then communicate that effectively — and passionately — to employees.

What is the prognosis for the rest of 2020?

The recent drop in engagement is far worse than post-9/11 or prior pandemics. Because of the intense social unrest causing disruptions within companies, it has been much more difficult for leaders to manage performance-related factors, and diversity and inclusion challenges are more in focus than ever before.

All of the factors causing the drop in engagement have also made it increasingly difficult for management to provide a clear focus for the future.

Leaders not only have to deal with performance metrics and how those should be measured during the pandemic, they also have to confront the anger and sadness caused by the killing of George Floyd in Minneapolis and the aftermath. How do corporate policies and practices regarding fairness, inclusion, promotion, performance review and more function during this tense, frightening time?

As long as the COVID-19 pandemic causes states, cities and municipalities to shutter businesses, and as long as the safety of employees could be threatened by returning to the “normal” workplace, it is nearly impossible to predict exactly what can and should happen and when.

Culture and engagement are more important than ever

Right now, corporate leadership has an unusual opportunity to shape a different kind of culture — or find a way to reinforce and reinvigorate the one that was left behind at the offices we all inhabited until sometime in March 2020.

Improving and maintaining culture during this crisis begins with leaders and managers focusing on the key factors that will bring employees together, coming to agreement on how to proceed, and communicating what needs to be done — and what the plans for the future will be — with absolute clarity and consistency.

The uncertainty bred by the pandemic and the subsequent shutdowns coupled with the societal upheavals being felt by everyone, everywhere will undoubtedly make the tasks incredibly difficult. But doing nothing or continuing to plod along doing what has always been done is not the answer. Not only won’t engagement improve, it runs the risk of getting worse.

Culture is the glue that holds the organization together. But it can also create a distinct competitive advantage. A great culture is extremely hard for your competition to copy, and it can attract and keep the best talent.

Workplace engagement — wherever that workplace happens to be — is more important than ever: making sure employees feel included, that diversity is important to the company and that everyone feels as though the company cares more about the people than the profits.

Remember: if you wind up with some kind of hybrid work environment where some have returned to the workplace while others remain at home, that can require an altered approach. If everyone was working from home but now some are interacting on-site, that can cause those who are still working remotely to feel left out and can cause those who are now going back to the workplace to feel estranged, even burdened by any perceived potential risk.

Culture can be somewhat subjective, but the most effective cultures value people, provide a path to career growth, and adapt whenever necessary to meet customer needs as well as those of the employees.

Is this unfortunately historic low in engagement a temporary slide or a long-term problem? We won’t know for a while. In the meantime, we can do whatever is possible to make sure that doesn’t matter as far as employee engagement is concerned.

Marsh & McLennan Agency is here to help

Building a strong culture can seem like a task that’s entirely too daunting. But doing it right is worth every effort.

MMA has a team of experts to help you analyze your current culture, make recommendations for moving forward, create the right plan, and effectively communicate it.

To learn more, contact your Marsh & McLennan Agency representative.