This article is part of a

Mercer series published in

the Strategist, a weekly
thought leadership
supplement of the Business
Standard.
By Padmaja Alaganandan & Anuradha Oza

When we work with clients from across the globe, we find that communicating
difficult news in bad times is one of the challenges they dread the most. I
really dont know what to say, is what we hear most often. And, as a result,
they focus on things like strategy and cost-cutting while retreating into their
offices.
But we know that it is possible, even in the worst of times, to speak the truth
and to be empathetic while showing resilience and hope, thereby carrying
people with you. When the Towers fell on September 11, Rudy Guilianis
statements were heard around the world, The number of casualties will be
more than any of us can bear ultimately... Tomorrow New York is going to be
here. And were going to rebuild, and were going to be stronger than we were
before.
Threats to companies are coming from the outside in. It is particularly at
this time that the leadership team in an organization needs to communicate
authentically, walk the talk and learn: in essence, lead from the inside out.
In our experience, these principles are the key to employee engagement in a
downturn.
We do as we say
Edgar Schein, as part of his breakthrough work on learning and culture, had
pointed out that people in organizations face survival anxiety and learning
anxiety. Learning anxiety accounts for a good portion of resistance to change
we choose not to learn because it means changing what we value, or
risking failure or being judged. As he rather acidly pointed out, unfortunately,
organizations choose to address this issue by increasing survival anxiety:
either an employee learns to do things or he loses his job. According to Schein,
learning thus happens under coercion, because survival anxiety overshadows
the fear of learning (and of change).
In a downturn, survival anxiety does not have to be created. It is a given. That
said, it is even more true that coercion is still not the best way to go, and that
an exploitative approach of creating anxiety in people while stretching them
on their work tasks can be counterproductive. In order to build employee
engagement in these times, companies first need to communicate candidly
and clearly about their current situations. If times are difficult and profits are
plunging, say so. Convey specific actions that the company is taking to address
these issues. Elicit employee suggestions and participation in finding solutions
collaboratively. It is especially important to communicate that resilience is a
Employee engagement in times
of uncertainty
choice: while we have not chosen the external circumstances, we can choose
our response and step up to the plate.
The way a company behaves in a crisis is remembered for a long time. Our
work with our clients as well as documented evidence suggests that companies
that communicate honestly and then try to make amends as best they could
to employees whose lives and jobs were affected in downturns, are able to
show greater employee engagement and loyalty over a longer period of time
than companies that allow rumors to flourish, act without notice and leave
employees adrift. The latter evoke employee ire, and, in some cases, have been
banned from recruiting from some of the worlds leading business schools for a
few years.
In one case, one of our clients, a major multinational bank, communicated
honestly with employees about painful layoffs, and empathized with them.
They also acted consistently on what they had promised. Interestingly, as their
CEO said a couple of years later, the company had conducted exit surveys with
staff who had to leave as well as climate surveys with those who were retained,
and both these surveys showed that regard and trust for the company was
higher than ever before, despite the enormous pain people had faced. As he
said, My job is to tell it as it is but also to give hope. The entire leadership team
tried to do that consistently, and I think we succeeded, despite misgivings.
So do as we do
Apart from communicating regularly and acting consistently, the leadership
team should also focus on creating an environment of psychological safety
so that people can pick-up new skills without the fear of failing. Starker
differentiation between high performers and the others becomes a necessity
in challenging times, as companies focus on raising the performance bar to
up the ante on productivity and results. However, we have also seen that such
performance differentiation can create greater anxiety in people, which in turn
can interfere with their ability to learn the skills that the company so badly
needs. Times of hardship can also be times in which people can be motivated to
give the best they have to offer. In order to counter performance anxiety, and to
keep people engaged and enthusiastic, we recommend that not just individuals
but entire teams are mentored and coached.
The basic premises of employee engagement do not change in difficult times:
while employees want security, they also seek challenge and growth. One of our
clients told us that in the best of times, they cannot wait for a manager to learn
on the job. In these times, organizations need people to learn faster than ever.
Boundaries between departments are collapsing and organizations continue to
become flatter as roles get reevaluated and managers take on more work.
Learning teams are a powerful way to address multiple needs, both for the
organization and the employees. For instance, we have seen that communities
of practice are a very effective tool in uncertain times: people have willingly
2
shared their anxieties when coping with new situations as well as actively
learnt from each other. A term taken from the field of knowledge management,
the concept essentially involves professionals meeting or interacting over
work-related issues to share insights and to learn from as well as coach each
other. Since communities of practice have people with varying backgrounds
drawn together by a common interest in sharing knowledge, the hierarchies
in the group are very loose. Since questions are asked authentically, and since
everyone has something to learn as well as to teach, people do not worry
overtly about perceptions and power plays. Some communities of practice in
our client organizations span continents, where people interact via special
sites designed to facilitate their interaction. These communities of practice also
foster innovation which in turn helps companies tide over crises.
The HR challenge
What is needed to make these learning teams work is people who are willing
to act as connectors and facilitators. The HR function can have a huge impact
here. In our client organizations, we have seen greatest successes when the
HR function has willingly embraced this culture. We have examples of clients
who have taken the lead to play this role: their contribution in terms of
essential issues such as scheduling meetings, ensuring technological support,
documenting reflection sessions so that everyone benefits from the teams
discussions and ensuring sustained group mentoring from top management
have all served well to increase learning, reduce anxieties and to show
exponential business results in the process.
In order to create positive, engaged employees, the leadership and the HR
teams are the message, and they need to lead through doing: by enabling,
learning and teaching.
To read other articles in the series, visit www.mercer.co.in/indiainsights
About the authors
Padmaja Alaganandan
leads Mercers Human
Capital business in India.
Padmaja has over fifteen
years of experience
covering a wide
spectrum of business
consulting dimensions
including business
strategy, organizational
design, performance
management, change
management and HR
Policy formulation
among others. She can
be reached at padmaja.
alaganandan@mercer.com
or +91 80 4185 7756.
Anuradha Oza is a senior
associate in the Human
Capital India team. A
Harvard and London
School of Economics
alumni, Anu has over
fourteen years of cross
functional experience in
corporate HR, consulting
and corporate social
responsibility. She can
be reached at anuradha.
oza@mercer.com or
+91 44 4397 4018.
Visit our website at
www.mercer.co.in
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