Human Capital Intel - 10/15/2024
Employee antagonism | Too nice to manage | Making an attractive office | AI-led laziness
Welcome to the latest edition of Human Capital Intelligence. As always, we would love to hear from you at ken@stibler.me with news ideas, feedback and anything else you find interesting.
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By Ken Stibler; Powered by Reyvism Analytics
What’s Working:
Measuring engagement gets difficult as employee antagonism rises
Recent layoffs and restructuring efforts at tech giants like Cisco and Shell have ignited a firestorm of employee discontent, highlighting the growing challenge companies face in maintaining workforce morale while pursuing financial objectives. Cisco's recent cut of 5,600 positions prompted frustrated staffers to decry the move as "the worst layoff handling in history" on anonymous forums. Similarly, Shell's aggressive cost-cutting under CEO Wael Sawan has led to a marked decline in employee satisfaction, with workers voicing concerns about diminishing rewards and a perceived lack of care from leadership.
“It didn’t matter that their value for the company far exceeded the actual compensation they were receiving, cheap labor is the only thing corporations care about.”
— Anonymous user commenting on “As expected, people have been selected for layoffs randomly” in the The Layoff, a platform where employees discuss job cuts
Whether the commenters are valid or honest is besides the point, such sentiment is common and spreading. And while RTO gets a lot of the flack, companies’ productivity push puts leaders and employees in direct opposition about their ideal direction for work. At its worst, this situation can create a tradeoff between corporate financial objectives and organizational health as alienation leads to a weaponized disengagement. At Shell for example, one anonymous comment broke down the company’s earnings reports to show the perceived contradiction of spending cuts despite robust earnings.
The shift from passive to active disengagement poses a problem for organizational listening efforts. Traditional methods like annual surveys are increasingly struggling from low participation rates driven by aggrieved employees looking for an opportunity to vent. Rapid changes make the yearly survey useless too, with Anna Lyons, Chief Talent Officer at Alegeus, arguing that these days, "employee sentiment changes by the minute, not by the year.”
To address these challenges, experts recommend a multi-faceted approach to employee engagement. As Jeffrey Lackey, CEO of JKL Advisors, emphasizes, "The concept of a survey being a substitute for a conversation is ridiculous." This means moving beyond simple surveys to incorporate qualitative methods like focus groups and listening tours, ensuring that engagement measures align with business realities, and balancing technological solutions with human empathy.
Managers are increasingly too nice to be effective
In an era of heightened workplace sensitivity, managers are becoming too nice to be effective leaders. A study published in the Journal of Applied Psychology suggests that managerial leniency, often mistaken for kindness, can have unintended negative consequences. When managers allow misconduct to slide, it can lead to resentment among other employees who expect fair and consistent enforcement of workplace standards.
Similarly a survey by Preply reveals that 92% of managers feel they need more training on how to fire someone, with 55% reporting no training at all in this critical area. This hesitancy to confront challenging issues is creating a leadership vacuum that can harm overall organizational performance.
My colleague is delightful, but bad at their job. Does that matter? (SMH)
At the root of this issue is a significant skills gap in conflict management, with nearly half of manager candidates lacking effective conflict management skills, and only 12% demonstrating high proficiency. This deficiency extends to other critical managerial functions such as providing meaningful feedback and motivating outstanding performance. The reluctance to engage in these potentially uncomfortable, but necessary, aspects of leadership is creating a workforce of ineffective "nice" managers.
Implementing coaching programs for managers can also help build confidence in handling challenging situations. By fostering a culture where managers are equipped to be both kind and effectively assertive, companies can create a more balanced, productive, and ultimately more successful work environment. The goal should be to develop leaders who are respected not just for their niceness, but for their ability to drive performance and maintain high standards.
Creating an office employees actually want to return to
While much of the focus on offices these days is on whether to return to them or not, a deeper problem has emerged as many companies no longer have offices worth returning to. Staggered enforcement and hybrid arrangements are creating the worst of both in-office distractions and remote disconnection. Major RTO issues have shown no quantitative proof of the promised rise in innovation, creativity, and collaboration.
To create an office environment that truly attracts employees while contributing to organizational goals, companies need to rethink their approach. As research from the NeuroLeadership Institute and Akamai suggests, workplace connections encompass four key elements: connections with colleagues, leaders, employers, and roles (CLEAR). Current return-to-office mandates tend to focus primarily on colleague connections, neglecting the other crucial aspects of workplace engagement.
Quote of the Week:
“We will not tolerate some people bending their backs for others who just don’t feel like coming to work. There is no room in this factory for people who don’t get out of bed in the morning.”
— Tesla director in Germany André Thierig about sending managers to visit the homes of employees out on sick leave.
Unsurprisingly, workers weren’t very happy about their bosses knocking on their doors verbally berating them and threatening to call the police. Lawsuits are expected to follow.
Reading List:
Leaders tell employees to “touch grass”
Home Depot is requiring all of its corporate employees, including senior management and remote workers, to work one eight-hour shift in its retail stores each quarter. CEO Ted Decker states this initiative aims to keep employees connected to the core business and understand the challenges faced by store associates. While the move is rare and has prompted its own backlash, it comes as employers increasingly value grit and real context over the abstract work of corporate staff that often leads to disconnection from core value production - especially outside of services.
Read more in Bloomberg.
AI dependence sets the stage for lazy mistakes
A hiring manager, suspicious at the lack of qualified applicants, applied for his own job and received an automatic rejection. After an investigate, the company fired half of its HR team for failing to properly do their job, instead letting automated systems do all the work. Across different levels of organizations, the ability to replace or highly augment specific skills is enabling employees to outsource core parts of their work without following through with oversight of the automated work product. Beyond this, a lack of need means younger employees are missing out on key skill development.
Read more at the Wall Street Journal.
Compensation shifts from salaries to bonuses in productivity push
In a bid to maximize productivity amid rising payroll costs, an increasing number of American companies are restructuring compensation packages to include performance-based bonuses for a wider range of employees. A 2024 survey found nearly 30% companies incorporating incentive pay into new roles. This trend, traditionally reserved for sales teams and executives, is now expanding to encompass professionals such as accountants, human resource managers, and marketing assistants. Proponents argue that this model fosters greater productivity and offers high performers substantial earning potential, yet others express concern over the unpredictability of their income and the potential for companies to use variable pay as a substitute for competitive base salaries.
Read more in the Wall Street Journal.
Data Point:
21%
Number of U.S. employees who admitted to breaking corporate RTO polices in a survey of over 1,000 employees by ResumeBuilder
In Other News:
Companies are craving executives with emotional intelligence—these are the new expectations for business leaders. (Fortune)
Reshoring has led to a small business boom in the South and Midwest. (Fortune)
While executives think they lead growth mindset by example, more than half of workers surveyed said they don’t see evidence of that. (HR Dive)
How to Develop Continuous Learners: Leaders can help more employees upskill, reskill, and adapt to change by applying four key strategies. (MIT Sloan)
U.S. Hiring Accelerated in September, Blowing Past Expectations. (Wall Street Journal)
Changing Jobs Can Put a $300,000 Dent in Retirement Savings. (Wall Street Journal)
Four Ways to Energize Your Dull Team Meetings. (MIT Sloan)
California passes flurry of laws on paid leave, discrimination and job posts. (HR Dive)
Pay Transparency Laws – Do they Apply to Your Remote Workers? (Maynard Nexsen)
Microsoft exec reassures staff there’s no plan for Amazon-style RTO. (Fortune)