In a recent report published by People Management Insight, in partnership with Oracle, the question posed was: ‘How can HR build a resilient business?’ It’s an incredibly pertinent question for HR professionals. The world is in transition and Covid-19 has changed life as we know it. In a recent executive briefing, McKinsey stated that the global economic contractions resulting from the pandemic had “far exceeded those of the great recession that ended in 2009 and have occurred at a much faster rate”. Organisations need to plan for how to emerge resilient by focusing on EBITDA (earnings before interest, taxes, depreciation and amortisation), margins, revenue and, most importantly, leading their virtual workforces.
Some of the statistics make for sobering reading: 60 per cent of UK organisations have reduced their workforces and 81 per cent have furloughed staff. Monthly GDP in the UK is 11.7 per cent below February 2020 levels. And, with a growing number of cases and further lockdown restrictions, any signs of recovery have lost momentum, meaning prolonged uncertainty looms.
It leaves the HR function with a dilemma. And it is one where we cannot point to a previous formula for success. Undoubtedly, we have to focus on cost saving in the commercial sense, actively considering all possibilities to ensure the organisation continues to be successful or, at the very least, survives. The natural assumption is that headcount and budgets will need to be slashed and for certain functions this may be particularly pertinent. For example, L&D budgets have been cut and in some cases teams furloughed. Indeed, research by People Management in June found 38 per cent of those surveyed had seen L&D budgets reduced and, of those, 58 per cent by more than 75 per cent.
Most firms prioritised the health and safety of their employees and pivoted rapidly to virtual working at the start of the pandemic. The remote working model was seen as short term and a method by which to manage risk. Things were put on hold as we readied ourselves for a short period of turbulence and uncertainty, with the assumption that normal service would resume by the summer of 2020. Some topics did garner increased focus, such as employee wellbeing, but again with emphasis on the short term. Many of us didn’t consider how we needed to grow our leaders to lead through this crisis.
At the London Stock Exchange Group (LSEG), we have really reflected on our approach to development over the last six months. Initially there was significant postponement across many of our signature programmes as we strongly believed that we would be returning to the office this calendar year and would be able to bring our leaders together from across the globe.
One of the core components of resilience is linked to the ability to pivot and take an agile approach across everything we do – and leadership development is no different. Our leaders make our business more resilient and leading in the virtual world needed to be a core component of our approach. Our natural inclination initially was to replicate what we had in a non-Covid world. As we reflected more deeply, we realised applying the context of coronavirus was imperative. The pandemic is affecting us all, and this is broader than individually, within our teams or even within our organisations. Societally, this is having a big impact on us all.
As a result, our approach to leadership development has been increasingly contextual – we recognised early on after the first lockdown that we were entering a whole new virtual world that created a new challenge for leaders. Within weeks, we started working on a series of short, practical webinars exclusively for our people leaders. These were designed initially to help them make the mindset shift to contextualise the impact of the pandemic on them, their team and working practices, and to give them practical tips on how to make the switch.
A week or so before lockdown, we had just run the first module of a flagship leadership development programme for our managing directors – the most senior 2 per cent of our organisation. While this was very well received, the impact of the pandemic meant we could not roll out the programme across the world as planned, and had to pivot our plans quickly, and unexpectedly, to create an alternative virtual programme. Subsequently, and in just a few months, we have created and delivered a virtual leadership development programme for not only our MD population, but also our directors – a bespoke programme for more than 600 of our most senior leaders.
Our most recent Ways of Working survey found 93 per cent believe the group is responding effectively to the pandemic, 88 per cent feel supported and 88 per cent are confident in senior leaders' ability to lead the business during this time. Despite the uncertainty created by the crisis, the transition to remote working has not affected individual and team focus, with 90 per cent of colleagues clear about what is expected of them. Staff also believe our people leaders are adapting well to the new ways of working, with 86 per cent getting support when needed.
However, we recognise we cannot be complacent, as the effects of the pandemic continue to affect individuals in different ways. In particular, colleagues have begun to feel less connected (90 per cent felt connected at the start of lockdown, but this has dropped to 76 per cent in just a few months), and find it difficult to disconnect from work. So building a resilient business starts with resilient leaders. The LSEG has demonstrated that investing in our people remains a core component of our strategy, regardless of the global pandemic.
Jig Ramji is group head of talent at the London Stock Exchange Group