In unprecedented times, it’s important to look back on what we’ve already learned. Responses to past crises can help inform the processes and strategies businesses will need to thrive in the future.
When Athena Chintis CPHR discusses some of the management practices she read and heard about at the beginning of the global financial crisis in 2008, she says she simply can’t believe the way people were treated by organisations.
Now head of people and culture at Cliftons Venues, Chintis was employed by Citigroup in 2008. At various banks and financial institutions she had worked through the ‘recession we had to have’ (early 1990s), the Asian Financial Crisis (1997), the dotcom crash (2000), the events of September 11, 2001, and then the GFC.
“Fortunately, more organisations now adopt a different type of approach to a crisis, rather than just walking people out the door, as I was told some organisations did.
“We’ve learned to behave in a far more empathetic way, in a more humanistic way and with a greater focus on retention, not redundancy as the only option. We’re now asking ourselves a lot more often, is this the way people want to be treated?”
These days, says Chintis, there is a greater focus on open communication.
In the past information has often come from rumours and media articles. When people were made redundant, often they weren’t even allowed to go back to their desks to pack up their belongings.
In the past we have also witnessed mass layoffs without any career support offered to those who lost their jobs. Media coverage of crises often included images of shell-shocked workers filing out of a CBD building – Lehman Brothers offices around the globe during the GFC, for example – carrying a cardboard box.
During the GFC the layoffs really were on a grand scale. In the final quarter of 2008, at the very beginning of the period of financial strife, over 150,000 jobs had been stripped out of the global financial sector. That included 50,000 at Citigroup alone. In one day, Credit Suisse announced 5300 layoffs, having already cut 1800 jobs, and Japan’s Nomura Holdings another 1000. Macquarie Group slashed 10 to 15 per cent of its jobs in Asia, and JP Morgan laid off 9200 employees.
“The biggest lesson from my time in GFC was to utilise my networks, peer groups and internal groups to collaborate on people-related initiatives when there’s little or no budget,” says Chintis, also AHRI’s NSW president. “I’ve brought those lessons into today,” she says.
“I can remember, during the GFC, staff reading stories in the press after decisions had been taken by a business.” Justine Cooper FCPHR, Head of APAC, Brook Graham.
Communication and collaboration
Now head of Asia Pacific for diversity and inclusion consultancy Brook Graham, Justine Cooper FCPHR worked as an HR director at Barclays Bank during the GFC. She agrees that communication has become a major focus of people management during the COVID-19 crisis – not just more often, but better quality.
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“We’ve seen much more collaboration,” says Cooper. “I can remember, during the GFC, staff reading stories in the press after decisions had been taken by a business. Now, at our firm we’re involved in lots of collaboration across the industry, from one industry to another and through the supply chain, with people being much more open around what it is that they’re doing, with the intent of being able to learn from each other. There’s a strong sense that we’re all in this together.
“This year I’ve seen creative ways in which organisations have been leveraging ideas from their people at every level. In our own business we’ve got a shadow board working with our partners and senior leaders. We’ve seen clients leveraging their employee resource groups, hosting community forums, creating new teams to look at different scenarios, etc.
“They’re getting insight from various people and feeding that real-time insight into the decision-making system, to help the business figure out how to respond and take advantage of opportunities. That’s all a result of diversity of thought.”
Compare that, she says, to the almost instantaneous cost-cutting and people-cutting many businesses undertook as soon as things began to go downhill during the GFC and other past crises.
“I was lucky enough to work for a decent employer during the GFC, who had redundancy policies in place and outplacement support, etc.,” she says. “But I saw some horrendous examples of layoffs, of people receiving text messages to be told they no longer had a job, for example.”
In 2020, she says, we’re seeing much more of a people-first mindset, one that focuses on physical, emotional and mental wellbeing.
Another change is around the nature of leadership. Throughout the GFC, says Cooper, while communication was often consistent and regular, it was very much top-down. It was all about updates that indicated the captain had a plan and was in control of the ship.
Today, Cooper and Chintis agree, we’re seeing much more honesty, humanity and authenticity from leaders in terms of their communications.
“We’ve partnered with clients where the CEOs have done regular Q&A sessions where nothing is off the table,” says Cooper. “Some really difficult and uncomfortable questions come through, and the CEO responds with honesty and transparency – ‘We don’t have all the answers, but this is what I can tell you’.”
This demonstrates a level of humanity and vulnerability that simply wasn’t there during past crises, she says.
“This year I’ve seen creative ways in which organisations have been leveraging ideas from their people at every level.” Justine Cooper FCPHR, Head of APAC, Brook Graham
Earlier in 2020 at Unisys, the company’s vice president and general manager of APAC, Rick Mayhew, was holding exactly those types of meetings with various teams across Australia and Asia. The feedback he received from many people who were working from home was that they missed their teams. Some people felt disconnected and physically isolated.
During past crises, in many organisations, such issues wouldn’t have raised any flags.
But with the knowledge we have today around the importance of wellbeing, the response was immediate. The management team developed a fun, physical team challenge in which anybody could participate, whether they’re locked down or not.
The physical and mental wellbeing program was called U-Move and was run during the month of September. Teams of employees from eight countries across the APAC region competed in a step challenge, which could also include other forms of exercise for those unable to leave their homes.
Some teams arranged daily virtual training sessions together. Others involved their families in extra physical activity.
A Canberra-based team met up to walk 30 kilometres around Lake Burley Griffin. Was there a prize for the winning team? Yes and no. There was a prize, but importantly it went to a charity nominated by the team. And there wasn’t just a prize for the team that completed the most physical exercise. Other awards went to charities of choice for teams that had the best name, the best shared photo, the best social post, and more.
The project was a success – 77 per cent of participants said U-Move was helpful in making them more active. The proportion of employees participating in daily activity leapt from 24 per cent to 86 per cent. And 69 per cent said they enjoyed feeling a part of a team. Most importantly, the percentage of people who said they were feeling ‘very concerned and stressed’ fell from 17 per cent to zero.
It was a very different attitude toward employees than most businesses demonstrated during the GFC.
Purpose is everything
Employment crises have been occurring throughout various spaces and industries, socioeconomic groups and social backgrounds for decades, says Malcolm Kinns, CEO of Generation Australia, an education-to-employment charity. Generation Australia supports people with significant barriers to employment by helping develop their careers.
For these individuals and for his organisation, every day is a crisis from which they are learning, and every day is a victory over that crisis.
“I think organisations are much more conscious of a process that they should go through to support people,” says Kinns.
“But I think the reality still exists that those populations who are most vulnerable tend to suffer the most during recessions and downturns,” he adds.
What will benefit organisations as well as communities, he says, is deeper thought around the new shape of the organisation, skills that will be required to move forward into the new reality, and a powerful understanding of the essential nature of diversity in getting there.
“The inherent piece that we need to learn in our hiring practices is to celebrate diversity for what it brings to the organisation, not from the point of view of diversity as a box-ticking exercise, but from what you get from that diversity – a strategic diversity of thought.”
John Alexander FCPHR, AHRI NSW State Council member, agrees that deeper internal thought is an essential ingredient when moving forward into uncharted territory. Organisations he has worked with in the past, including GE, Abbott and The Salvation Army, have wisely used downtimes to upskill staff in preparation for when the curve swings back upwards, he says.
The most important lessons from the past, he says, reveal that what sets successful businesses apart is organisational purpose.
“I’ve spent a lot of time in for-purpose, community-focused organisations,” he says.
“They tend to be more resilient because the people who work within those organisations feel as though they have a real purpose, and sometimes individuals will put that purpose in front of everything else, because they’re caring for a client or a patient, for example.
“So, for me, the best lesson that can be learned from organisations that have succeeded in the past is that organisational culture that offers staff members a purpose, and therefore inspires, encourages and promotes particular behaviours and opportunities during challenging times, is essential,” he says.
“Open and honest communication is vital, as is some form of recognition for staff. But to me, culture and purpose are the constant secret to success.”
This article first appeared in the December/January edition of HRM Magazine.