5 minute read 24 Apr 2020
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How long-term value fits into the short-term COVID-19 imperative

By

Michael Bertolino

EY Global People Advisory Services Leader

Leader of growing, future-focused team of talent practitioners. Award-winner. Supporter of women in business. Extreme cyclist. Husband to Mensa-sharp wife and two thoughtful kids.

5 minute read 24 Apr 2020

Companies who live their purpose through COVID-19 will generate long-term value that will pay dividends long after the crisis has passed.

In the last couple of years, we’ve been seeing a shift toward long-term value creation, which looked beyond a company’s financial performance to include the human factor: customers, employees and society. Companies were beginning to be judged both by their value in the stock market and their value to society.

Specifically, I said as the new year began that I’d keep one question top of mind: “What happens when people matter most?” When I wrote that blog, I had no idea how important that question would be in the context of the crisis we face now.

As companies around the world grapple with the impact of COVID-19, leaders looking to protect their companies may be tempted only to ask short-term questions:

  • How do I manage the financial implications of this crisis for investors and shareholders?
  • How do I solve for liquidity needs while addressing what I see as business imperative issues (which may not include the necessary actions I need to take to activate my workforce)?

These are vital questions for sure — putting an entire company’s focus on answering these questions correctly may keep it going in the short term or power it up for the long term. Yet, without considering the people factor, I expect these companies will be judged unfavorably when stakeholders — customers, employees, investors and governments alike — go to measure the impact of long-term value.

Through the prism of “people mattering most,” companies should be asking first and foremost: How do I keep my employees safe? How do I keep my customers engaged? How can my company help society?

For companies that are guided by purpose, these questions, and many more, will be of primary consideration in how organizations build resilience in the short-term and position themselves for readiness and recovery in the long term.

Those who know me best know that I strongly believe employees should be a company’s number one priority, particularly in times of crisis. They are a company’s heart and lifeblood. They are the ones who innovate with technology, deploy the assets and create the consistently exceptional experiences that delight and serve customers across the value chain. Employees who are well cared for through exceptional employee experience enhance customer-centricity and enhance the performance of the organization, which helps create liquidity through optimized performance. This is (or should be) every company’s goal.

There is a saying: “happy employees equal happy customers equal optimized outcomes.” And yes, even during a crisis situation people can, and should, find happiness. During this especially challenging time, employee safety and wellbeing should be table stakes. Understandably, people are feeling anxious and uncertain about the future. Company leaders need to demonstrate understanding and empathy in a way that is genuine.

If employees feel that their company and its leaders care about their wellbeing at work and at home, they will be more likely to trust the decisions the company makes. Trust and purpose go hand-in-hand. If a company has earned the trust of its employees, it is more likely to earn the trust of its customers and more likely to optimize performance.

Safety and wellbeing extend beyond the physical to include mental and emotional. In a time of crisis, this means paying close attention to personal dynamics and identifying and addressing any biases that may arise. In this era of inclusion and diversity, biases still exist. In times of stress unconscious bias and its more sinister cousin, discrimination, may bubble to the surface in ways companies may not expect. They need to push past this part of human nature. Diversity and inclusion of thought and experience is critical to succeeding in today’s age — before, during and after a crisis. Purpose is activated by a sense of belonging. Employees that feel a sense of belonging in their workplace, particularly in times of crisis, are more likely to be engaged and productive.

Safety also includes maintaining confidentiality. Safeguarding employee confidentiality, including any health-related matters, needs to remain a top priority. Confidentiality signals trust. If the company breaches an employee’s privacy or confidentiality, even if it thinks it is doing it for the greater good, the company will lose the trust of its workforce. This in turn will have broader impacts on employee engagement and productivity — not to mention regulatory impact, depending on jurisdiction. A company willing to sacrifice the trust of its workforce, for whatever reason, has lost sight of its purpose.

While most of a company’s attention should rightly be focused on the health and wellbeing of its workforce, there are additional opportunities that companies aligned to their purpose can pursue. Travel bans, collective- and self-quarantines and the movement to an exclusively work-from-home model are creating challenges around business continuity and productivity. However, it is also spawning new opportunities for alternate, inclusive and flexible ways of working.

New collaboration arrangements are surfacing as companies ramp up remote working models and implement split teaming. Jobs may be disappearing in one part of the company, but others may be emerging that affected employees can shift to. Reimagining workforce arrangements to address employee wellbeing while maintaining business continuity will generate opportunities to innovate, too. Meanwhile, companies could unlock the potential for new connections within the organization and across its ecosystem as everyone pulls together to keep the workforce safe and business operating.

Purpose is the “North Star” that guides a company through good times, but especially through bad times – remember: culture matters most during murky waters. Companies that have the right defined purpose and are clear on the workforce values that align with it can actively plan to protect their people during this challenging moment in time. These companies will earn the trust of their employees, who will be more engaged and motivated to deliver exceptional customer experiences, and better positioned to contribute to society more broadly. These companies are already generating long-term value that will pay dividends long after the COVID-19 crisis has passed.

Summary

In the era of COVID-19, organizations must continue to put people first in order to build long-term value. By doing so, they will earn the trust of their employees, customers and stakeholders. 

About this article

By

Michael Bertolino

EY Global People Advisory Services Leader

Leader of growing, future-focused team of talent practitioners. Award-winner. Supporter of women in business. Extreme cyclist. Husband to Mensa-sharp wife and two thoughtful kids.