Monday, October 27, 2008

A New Paradigm For Employee Engagement: Part I

Fear has become the catalyst for engagement and retention.

As headlines scream layoffs and unemployment numbers spiral ever higher, fear grows like weeds among senior employees as anxiety about keeping their jobs builds daily. Couple this with a declining economy resulting in fewer new jobs and it's no wonder that those still employed are riding emotional roller coasters.

Short-term relief, long-term pessimism and daily uncertainty are now motivating many of today's executives.

Retention, so recently the hot button issue among the corporate hierarchy is no longer part of the dialogue. Concern about losing key people doesn't have the same urgency when the ranks of available executives in the marketplace continues to swell.

Executives are engaged all right, but they’re engaged out of fear. They know that layoffs across all levels, sectors and industries will continue and they don't want to be next.

Short-sightedness rules the day

In this environment, employee satisfaction has been trumped by shareholder wrath.

With the outlook for profits in 2009 appearing dismal, many companies are reducing or entirely eliminating employee development programs for their current workforce. Balance sheets and budgets rule all decision-making. Employee engagement initiatives have been relegated to the discretionary and seemingly unnecessary expenses column.

While such draconian measures may be required for companies' short-term fiscal health, what happens in the long run when the primary factor driving employee engagement is fear?

I’ve witnessed companies, during past cost-cutting sprees, shred the programs that exhibited their commitment to employees. And I’ve seen employees' reactions when they're forced to undertake increased workloads along with decreased benefits. As anyone who has ever been in that position can confirm, it's not the optimal formula for an engaged, productive workforce.

While it's true that fear can be a motivator and undoubtedly keeps employees from roaming, there is a significant downside. Fear does not instill loyalty. Fearful employees do not have their employer’s best interests at heart and probably never will. Fear is rarely a formula for ongoing success.

Get ahead of the curve

Think ... and act long term.

Employees, executives included, have much to be concerned about. For many, their personal wealth has declined in tandem with the job market and options are fewer. So while their current fear may keep them bonded to their companies and willing to do whatever it takes to keep their jobs, it’s not the kind of glue that sticks.

Eventually this crisis will pass and once again the cry will go out for increasing engagement among employees and improving retention. When that time comes and the “hammer” passes from the employer back to the employee, companies can find themselves reaping the "rewards" of their neglected workforce.

Key employees can ... and do ... jump ship once the lifeboats return.

Nothing is as constant as change

Those companies that have done best by their people during a downturn will be the quickest to prosper and hold onto valued employees when the tide turns ... which it eventually will.

Conversely, those companies that have ignored critical concerns and dismissed the fear prevalent in the workforce are not planning for success in a future turnaround. Even with present budgetary restraints, costs associated with ensuring positive employee engagement are minimal.

Given how many dollars are spent on exiting employees, one wonders why companies choose to neglect those still with them.

It could be, that they're - penny wise and pound foolish.

Wednesday, October 15, 2008

The New Workplace Reality

It’s amazing how quickly things can change.

With the calamitous shock to the stock market and business leaders like Bill Gates predicting that unemployment “may peak at more than nine percent,” the prospects of easy job finding have all but vanished overnight.

And with that has come a sudden change in business priorities and an altered outlook among employees.

What a difference a year makes

This time last year, long before the economy went haywire and free market nations opted to nationalize their banks, businesses and their HR professionals were focused on the twin issues of engagement and retention.

Holding on to top performers and dissuading them from venturing out into the friendly waters of the job market was a critical priority. Companies knew jobs were easy to come by and they made every effort to identify and meet the needs of their workers while brushing up the welcome mat to attract new ones.

The results of engagement surveys were obsessed over and programs were rolled out designed to ensure employees did not roam.

But the pendulum has swung and what was recently a “sellers” market for employees has gone the way of the dodo bird as the anxiety felt by those who fear their jobs are in jeopardy grows with each new negative headline.

Couple this with the rash of downsizings now being announced and you have a scenario designed to keep employees chained to their jobs and fearful of even considering options.

Talent management still matters

In times like these, cost cutting becomes the name of the game. And the easiest way to reduce cost is to reduce headcount while simultaneously freezing the number of new hires.

As employers “pull in their horns,” so too do employees. Survival becomes paramount, trepidation about pursuing outside options grows and career advancement takes a backseat to job security.

But employees paralyzed by dread is not a formula for moving business forward.

Evolved employers know that people really are their most important asset and that retaining them through fear rarely leads to increased productivity or business success. While cutting staff may be necessary and running lean an imperative, maintaining employee engagement is now more important than ever.

So while the reality of finding jobs in the current workplace has changed, the need for engaged and committed employees has not.

Friday, October 10, 2008

How Safe Is Your Severance Package?

Anxiety has become the great common denominator among corporate executives.

“What if I lose my job?” is the question many ask as fear about how well they can withstand a job loss steadily grows.

Their fear is warranted.

Many have seen their net worth fall rapidly as the stock market freefalls, investments plummet and property values continue to decline.

Add in the frozen credit markets and the buzz about an impending global recession and you have a recipe for unprecedented stress that is being felt in all sectors around the world and in virtually every household in America.

The rules keep changing

Not too long ago, when an executive was fired, they could anticipate a healthy severance that would tide them over until they found their next job. No matter how short their stay with a company, it was widely felt that providing attractive exit packages was a good investment.

Severance packages mitigated the disruption felt by terminated executives, reduced the potential for litigation and improved the odds that those leaving retained positive feelings towards their former employer. Plus, they helped ensure that remaining employees perceived the company as a fair, concerned and responsible corporate citizen and, in spite of layoffs, a desirable employer.

But as the number of fired executives grows and future layoffs loom larger on the horizon, generous exit packages will be among the casualties of the economic meltdown.

Less is not more

In an article entitled Lehman Staff Gets the Shaft in Severance, the NY Post told the story of one Lehman employee who left in March, after 16 years with the firm.

Her severance package included salary and benefits continuation for 13 months. A safety net designed to last through April 2009.

But on September 30, she along with other former Lehman employees, was informed by letter that the company was ”no longer able to provide salary continuation or other benefits and as a result you will not receive payment on October 3 or thereafter.”

Totally unexpected ... and, unfortunately, completely logical.

Lehman Brothers, having been forced into bankruptcy, simply does not have the funds. And today, many companies are in a survival mode that will force them to alter their severance policies.

The new reality

So what’s an executive to do? Prepare for the worst case scenario.

Proceed as though you will be given a zero separation package and plan and act accordingly.

Ensure your cash reserves are adequate to support an extended job search and as I've written previously, develop Plans B & C.

The marketplace will be shedding many more jobs in the upcoming quarters as companies retrench to remain viable. Many will just not have the cash - or credit - for severance payouts.

The saying, "It's not in the bank until it's in the bank" has never been truer.

Friday, October 3, 2008

Entrepreneurial Career Options

When it comes to careers, you have two options: Work for someone else or work for yourself.

As I’ve written previously, the first option will become considerably more difficult in the upcoming months, so if you haven’t considered the second, now would be a good time to identify and explore entrepreneurial possibilities.

Entrepreneurship can take many forms, from independent consultancy to the formulation of a business, from the development of a local service company to the acquisition of a multinational franchise.

In other words, no matter how meager the job market gets, if you’ve prepared for worst case scenarios, a well executed entrepreneurial option can give you a way to survive and possibly thrive in difficult times.

Risk-averse executives

The magnitude of risk aversion expressed by those who have been employed their entire careers seems to increase in proportion to their status in the company. I’ve coached many successful senior-level executives who are highly reluctant to strike out on their own.

For all their accomplishments, they are less confident than many newly arriving immigrants in their ability to make it outside the corporate cocoon. For them, the notion of starting or buying any kind of business is fraught with angst, doubt, fear, rationalizations, etc. They want the safety net they think an employer provides along with a steady salary, benefits, perks, etc.

Unfortunately, during times of economic crisis, the financial well being of many companies can be in far worse shape than the personal portfolios of its employees.

Where is the safety net when that happens?

Entrepreneurship vs. Employment

While “being your own boss” is a not-so-secret wish of many executives who glamorize the independence it brings, the likelihood of success is never certain. It’s that uncertainty that often stops them from pursuing it.

Well, the likelihood of job-finding success in the current corporate marketplace is also becoming increasingly uncertain and may only get worse in the months ahead.

When that happens, adding the active pursuit of an entrepreneurial option may make good sense.

Because, when the uncertainty associated with finding a job or entrepreneurship starts to level out, spending time pursuing one or the other presents a more equal risk/reward ratio … with one key difference:

For the foreseeable future, executive employment opportunities may be fewer and harder to find than innovative entrepreneurial options.

Wednesday, October 1, 2008

Contemplating A Career Change

What will you do if you don’t find work in your chosen field?

If jobs across the board start to dry up, what options will you pursue?

Those are the questions I raise to clients as the crisis in the credit markets threatens to grind commerce to either a snail’s pace or complete halt. The significant increase in the number of impending layoffs and the possibility of widespread hiring freezes underscore the importance of knowing those answers.

Fewer jobs, more candidates

One certainty that will emerge from the current economic situation is that in the short term, more people will be vying for fewer jobs.

Some looking for work in this crowded job market will come up empty. Even after they’ve made all the right moves … responding to ads, contacting headhunters, networking, exploring smaller companies, out-of-area opportunities and different industries … they’ll still be unemployed.

Plan B

If it appears that no one is hiring your skill, at your level or in your field, what are your alternatives? What else can you do?

First, redouble your efforts. Go back and start the campaign all over again. Explore deeper, improve your focus and push harder. Many times, those who put in the most effort get the best rewards.

But these are not ordinary times. When the economy is running as usual, changing jobs is often easier than changing careers. But in times like these, when it’s business as unusual, career changing may prove to be a necessity.

Plan C

The plan of last resort, like the “lender of last resort” addresses basic survival.

How can you earn sufficient dollars to maintain a desired lifestyle if your traditional career path is blocked?

What to pursue and how to pursue it are as individualized as the people, jobs, services and products in the workplace. No one size fits all. Each individual’s options can be as broad, diverse and as “out of the box” as the range of their talent, skills, interests, abilities … and risk tolerance.

Unfortunately, most executives don’t consider career changing until all other avenues have been exhausted and both their resources and nerves have been frayed. That’s one of the biggest mistakes they can make.

If you don’t have a viable plan that spells out what you’ll do should your job search be protracted and unproductive, you’re choosing to ignore a potential reality.

That’s a choice you can’t afford to make.

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