COVID-19 and the Future of American Business for 2020 and Beyond

INTRODUCTION

The year 2020 will forever be marked by an unforeseen lesson in vision. We didn’t see it coming, but we all must now recognize where the lesson is leading us. And we, the business and organizational leaders, are obligated to confidently embrace this time for improvement. We must be creative, innovative, and progressive in offering improved employee and customer experiences, more successful business strategies, far more efficient operations, and stronger local, national, and global economies.

Some businesses are healthy and thriving, while countless others will never reopen. Some workers are lamenting their return to the office, while others enthusiastically prepare for a new normal. We, the business leadership community, need to acknowledge the facts of what was, what is, and the future we need to create. Leaders are challenged to set new standards that focus on people at every level, that serves every investor, employee, and customer, and delivers excellence at every product and service interaction.

The American experience has always been fraught with the tension between bold individualism and entrepreneurship and the establishing of a national community to ensure a common good. The interplay between government, business, education, and non-profits is a hallmark of our American economy.

Today, the CEOs of America, small business leaders in every state and entrepreneurs in every community have a new responsibility. 2020 marks the year in which we, the business leadership community, must provide a new vision for the American economy and confidently carve our own path in this new adventure that none of us could have foreseen.

The starting point is innovation of service to employees and customers. How do we serve a marketplace full of new demands with increased technological engagement and exacting expectations of convenience and safety? Our lives and our businesses are being largely remade by this global pandemic which has impacted our businesses, families, employees, customers, and other stakeholders. We can cooperate, compete, and improve. To that end we have diligently gathered a wealth of wisdom and insights from our contemporaries—CEOs and leaders from around the country— who are sharing their understanding of this sea change that is the intersection of commerce, customers, convenience, and caution. Additionally, we have scoured numerous articles, essays, and briefs being drafted in response to this ever-changing time. We have prepared this paper which we hope will guide us all toward quicker success in the coming months, years, and decades.

This paper is crafted for the great leaders we need during this critical time. Leaders need insights, understanding, and strategies for the future. We are in a time of great challenge and transition. The current global pandemic is forcing companies, organizations, and leaders in all areas to move in new directions toward new goals. Some businesses will collapse. Some will thrive. There is no question that all businesses will be different.

It is our desire to provide leaders with ideas and realities in six fundamental areas that will determine future success. We outline some of the most significant challenges CEOs are facing today, including relating to the health of their workers and customers, ensuring the continuity of business operations and distribution channels, adopting new technologies and processes, and adapting business strategies to a new and evolving marketplace.

This paper also shares insights and ideas on how to successfully emerge from this crisis. We present various strategies and solutions to aid you in navigating the changes from unprecedented work stoppages, lack of consumer confidence and spending, new legal requirements and limitations, and ever-changing work from home (WFH) expectations.

The most successful businesses are those that are able to pivot quickly, adapt to new technologies, and lead their people through necessary transitions. Some organizations will not be able to adjust to these new realities brought about by this pandemic, and sadly, they will risk closing. Organizations willing to move quickly, think strategically, and find new opportunities will capitalize on a new talent pool, new resources, and fewer barriers to entry. 

The four of us hope these insights help!

Part One of Six – PEOPLE

Leaders create processes and programs to attract and retain employees, to serve customers, to develop people professionally, and maintain goodwill within the communities they serve. Today, we also realize that our businesses are in jeopardy if our employees are ill or if our customers’ business expectations change. The centrality of people, all people, compels us to shift our priorities from shareholder value to stakeholder value. If we put our key stakeholders first, in this order – (1) employees, (2) customers, and (3) community then (4) shareholder value will be at its full potential.

Challenge: Company’s Role for the Health of Employees and Customers

This pandemic increased awareness of the employer’s responsibility and liability for providing a safe work environment. Various questions have been raised regarding office environments, production facilities, travel obligations and caring for, and managing, sick or exposed employees, immune-compromised individuals, or those at the highest risk of danger.

Opportunity: CEOs need to make health and safety a strategic priority, and set (rather than follow) standards in their industry and community. By being pioneers and developing their own standards of safety they will enhance their market position, attract top talent, and assure valued customers. Top talent and preferred customers will be attracted to the companies that are initiating rather than merely following guidelines. COVID-19 has created a stronger role for the employer, and safety and health guidelines must ensure we are meeting the needs of our employees at every level.

Solution: Innovative CEOs and leaders are working with their teams and industries to develop, establish, and test new guidelines and policies pertaining to safety in the workplace. In addition, the CDC and the World Health Organization have outlined best practices for providing safe work environments and protecting both at-risk and exposed employees. This is a starting place.

Companies should first approach health and safety holistically. The policies and procedures created now must be cognizant of the physical, mental, and economic health of both the employee and their family members. While drafting or revisiting guidelines for in-office and travel safety, PTO, and WFH, consider all the ways your employees are impacted now, and the support they will need.

Second, engage employees in workspace initiatives. Work cooperatively—give them a voice and a role in establishing guidelines and policies. Challenge them to determine the level of risk they are willing to assume, how the changes are best implemented, and how this will be communicated in the organization. For these new initiatives to be effective, team engagement and ownership are vital, so design your program accordingly.

Third, be proactive in taking a leadership role in defining how the industry responds to the needed health changes. Make recommendations, offer to test new products, and volunteer to be a beta when new guidelines are initiated. This increased awareness is dramatically changing what is required of employers, and we believe it is better to have a seat at the table, rather than wait for direction.

Lastly, involve customers. Companies need to observe, listen to, and solicit input from customers on how they want to interact. What safety initiatives do they want? What is too cumbersome? Effectively engaging customers, and communicating with them on updates and changes, ensures they feel heard, valued, and part of the process.

Challenge: Communicate, Communicate, and Communicate

Communication — how, what, and when — is a more significant hurdle. Many CEOs admit they were underprepared for the level, the needed consistency, and the new mediums required for communicating during this crisis. The resulting lack of communication caused fear with employees, decreased productivity, and reduced engagement. It also created concern from customers who did not know if companies could still meet their needs, were safe, or even still in business.

Opportunity: CEOs who prioritize communication are far more likely to have a more engaged team and a more loyal customer base. The best CEOs and leaders understand that their employees and customers can handle bad news. What they cannot handle is no news. The best strategy is transparency. Be open and honest about where your company is doing well, what the challenges are, and how your employees can help.

Solution: Remain visible. Create a communication strategy that ensures employees are clear about what is expected of them, they have the tools and resources needed to achieve the expectations, and they receive regular, honest, and transparent updates.

Communication with employees needs to be increased during times of crisis, especially with a remote workforce. Start each day with check-ins, get company updates on a weekly basis, and ensure coaching sessions are scheduled routinely. Employees need to be informed as they engage and talk with customers more often than leadership.

Ensure communication with employees is a two-way street. Employees need both (1) feedback on their performance and (2) the opportunity to share their concerns as well as their ideas for increasing productivity and service.

Regular communication is needed with customers on everything from how operational procedures have changed, how your products and services have been adjusted to solve their current challenges, and what the company is doing to keep both customers and employees safe.

Ensure that leadership from every level is intimately involved in communications. Customers and employees need to see and hear from the CEO, as well as from division, department, and team leaders. Using all mediums—especially video—is key to ensuring that messages are effectively communicated.

Challenge: Leading Remotely

In a matter of weeks, what was considered innovative became the norm. Companies had to determine how to transition from having employees working onsite to working from home. The challenges were many, including having a lack of proper technology, uncertainty as to how to manage and lead employees who were isolated from supervisors and coworkers, and a lack of systems and guidelines for workers and managers to adhere to. While most CEOs interviewed said their teams performed well under the pressure, most also admitted the experience caught them off guard and under-prepared.

Opportunity: Leaders recognize the long-term benefits of remote workforces, such as decreasing the need for expensive office space, increasing the pool of talent they can recruit, and fostering a new enthusiasm and loyalty from employees as a result of greater work-life balance. The effort needed to foster workplace community is inviting new ideas that are positively shaping the company’s culture.

Solution: CEOs and leaders should rethink their approach to facilities, employees, and managerial accountability. There is tremendous possibility in taking a holistic approach to how you invest resources, find top talent, and lead teams going forward.

Leaders need to update their business plans as it relates to the office space they actually need now that many workers will remain remote. What will that office space need to look like in terms of number of employees in the space, sanitation, air filters, handless doors, and several additional safety measures?

While office space may be more expensive, many companies will need less of it.

Human resources will need to become proactive and strategic to capitalize on the opportunity that remote employment brings to the hiring pool. Leaders and CEOs have a tremendous opportunity to hire the talent they want and need without being restricted by geographical location and time zone. Rethink what your company needs from a talent perspective in the coming years, and then challenge human resources to find, recruit and onboard those needed individuals.

Training must also be revamped; everything needs to be reviewed, big and small. Employees new to the WFH environment will require a host of new technical skills. Supervisors will need to know how to lead and engage a remote workforce.

Adapt new training methods that include more virtual, self-paced learning; shorter, more frequent training segments; and instruction that pertains to both professional and lifestyle issues.

Challenge: Personal and Professional Engagement with Furloughed Employees

Many CEOs interviewed were forced to furlough longstanding employees, initially with no idea of when or if they can have them return. As such, retaining workers is the priority. Artificially high unemployment benefits are deterring many from wanting to return to work; some will not return to the labor force.

Opportunity: Now is the time for leaders to show their empathy for employees, especially those who have been furloughed. Organizations that treat furloughed employees with compassion and respect are those most likely to have loyal employees eager to return to work. It is very possible that some reluctant employees will return to work and leaders need to ensure those employees, once again, become enthusiastic toward the organization and toward leadership.

Solution: Many CEOs are actively communicating with furloughed workers. Some have created internal communication strategies or small team projects to ensure regular and meaningful connections, helping to foster their desire to return to work.

Treat furloughed employees with compassion, empathy, and respect. It is the right thing to do, and from a company perspective, it’s imperative as all employees will be watching and judging leadership on their interactions. Leaders should remember that while power has shifted today, it won’t be long before attracting and retaining top-quality employees will become an issue again.

Challenge: Attracting, Recruiting, and Hiring the Right Talent

Before the pandemic, finding talented team members was almost impossible. Post pandemic, employers will be able to choose. Many CEOs understand that power has shifted in their favor. CEOs acknowledge that it is probable that some furloughed employees will not return to work and that the number of talented individuals looking for new opportunities will grow.

Opportunity: Employers are now in the power position, and the opportunity to find, hire, and engage top talent is at an all-time high. Before 2020, the unemployment rate in the United States was at a record low of 3.5%. But now, the National Bureau of Economic Research is reporting that 42% of those who have been laid off won’t get their jobs back. Millions of people have filed for unemployment. Many employees believe that this is a good time to make a change in their career, their industry, or their working environment. Many employees will not go back to their former employer, even if they are invited to return to their former position. This will result in an overabundance of new and experienced candidates when companies start to hire again. Managers and leaders can scrutinize the talent they want.

Because of the increased use of technology and the resulting cost savings, companies may be able to offer employees a higher salary, more flexibility, and more benefits. There will likely be retirement-eligible workers returning to work.

Solution: Get clear on the talent needed in your organization, both presently and in the coming years. Work with Human Resources to bolster your recruiting strategy and network, even as it causes labor expenses to increase in the short-term. Employers should know their ideal employee avatar, so they are in agreement on the employee they are looking for. Short-term efforts to acquire the right talent will pay dividends in the long-term.

The Human Resources department needs to function like the sales department and create a proactive pipeline of the right talent. Hiring and keeping the right people is an investment in corporate culture. Attracting talent is one step. Engaging and retaining employees depends on the feeling of connectedness they have with the organization.

Talent remains a great competitive advantage, and with the pandemic employers now have more choices.

Challenge: Assessing Employee Performance

Organizations are changing how leaders perceive and judge performance. People working from home will be assessed on the results they provide, not just on their personality—their charisma— or on their location.

Opportunity: Every downturn forces executives and mid-level leaders to assess the contribution of each employee. The new environment of working from home means employees are being assessed based on a different set of standards than before the pandemic.

With only 29% of companies giving high marks to their own review process (Mercer) this is an opportunity to rethink how we assess employees, communicate, and receive feedback, as well as review the purpose and anticipated results of performance evaluations. Companies are realizing that to be successful there is more needed from employees than numbers-based performance.

Solution: Redesign performance reviews to appraise both hard and soft skills required for superior employee performance. This year reemphasized the importance of teamwork, communication, persistence, resilience, diversity, and the ability to adapt and change.

Reassess existing goals to fit the circumstances such as a drop in sales or employees adjusting to the new practices of working at home. Compassion needs to balance with accountability.

Remote workers, because they lack direct in-office supervision, need to have performance reviews more often. Technology makes this possible. Schedule frequent communication to provide feedback more often to help team members stay focused, engaged, and on track.

Lastly, have compassion. This does not mean eliminating or reducing standards. Leaders need to support their employees with the care and resources they need to be successful. For employees not succeeding in spite of the communication, feedback, and resources, handle them honorably as you develop performance plans or part ways. The most talented employees are relieved when leaders hold non-performers accountable.

Challenge: Creating New and Relevant Training for Employees

Several CEOs who were interviewed shared newly required WFH employees were transitioned without the proper training, tools, and security protocols. Suddenly, employees had to learn new skills.

Opportunity: Training strategies and practices need to be updated and overhauled to reflect the needs of today’s employees. Leaders are identifying the skills and resources teams need to be successful in their new work environment, providing the training to meet those needs, and delivering it in a way that is easy and effective for team members to learn and implement.

Employees are aware of their skill set deficiencies. They are willing to have a plan to help them improve. More employees are proactively seeking relevant development opportunities.

Online learning has exploded. The best professional speakers and trainers have pivoted to online delivery. This means organizations can now afford world-class training delivered virtually. While nothing replaces the energy, focus, relationship building. and learning opportunities afforded at in-person conferences and training events, employees themselves are more willing to learn virtually and more comfortable with online learning and programs.

Solution: Update the roles, responsibilities, and training needed for each employee. Develop individual training plans giving each employee a voice, and an opportunity to create their training plans. Training and development should be strategically-minded, personalized, and interactive. The most effective training considers how people learn best and offers current, relevant, and informational situations where coaching can occur.

Be ready to meet the learning needs of every team member. Some like to read a manual. Some like to have an expert provide one-on-one training. And some prefer to learn in a (now virtual) classroom or a conference setting. Find out how your employees like to learn, and then meet their needs.

Prepare a list of favorite conference speakers, authors, and trainers. Ask peers to recommend trainers and virtual training opportunities. Research the trainers and the services now being offered online. The cost of joining top business and leadership programs, as well as hiring some of the world’s best professional coaches, is easily managed as it replaces the previous hotel, food, travel, and entertainment expenses.

One of the most important parts of a leader’s job is to find the best talent they can afford, hire them, train them as needed, develop them to their full potential, and promote them to leadership. Organizations should include world-class training programs using both virtual and in-person opportunities to ensure the best talent is prepared for the next challenge.

Challenge: Managing Potential Conflict with Existing Union Rules and Contracts

Unions have historically played an important role in American industry, aiding workers when conditions become compromised. This pandemic has reignited the debate as to the role and relevance of unions which has historically been to (1) increase the number of jobs, (2) increase wages, and (3) increase safety.

Opportunity: Pre-COVID-19, unions were declining, with members questioning expensive dues, the value of membership, and even the need for unionizing given their healthy relationship with employers. There is now a renewed interest in the voice of the employee, especially essential employees, in terms of safety, sick leave, time to care for ill family members, and other new challenges.

Most union rules and labor contracts were developed in a pre-COVID-19 world. The old rules and contracts may no longer be relevant in a post-COVID world, creating tension at all levels which will only increase as operations come back online. Most parties are likely to be willing to discuss revisiting rules and contracts with the purpose of improving workplace conditions and potentially lowering operating costs. Unions want to save jobs that may be lost to automation. Employees want cleaner and safer working conditions.

The strong 2019 job market made it difficult to attract and retain top talent. The market favored employees which often led to management providing concessions to union representatives. Now, because of historic unemployment, management has more leverage. Many employees will have a realistic perspective of the marketplace and stay in jobs longer and accept job offers more quickly.

Solution: Non-union companies need to understand the risk of not prioritizing the care and safety of employees. Union companies should immediately reengage with union leaders to care for employees.

Employees, shop stewards, and local unions will each interpret new workplace rules differently. This confusion requires clear lines of communication and understanding by all supervisors and managers. Make certain that all front-line managers understand that they are not empowered to make any commitments or permanent alterations to procedures without first discussing the issues with your human resources team.

Invite employees to the table. Ensure they are part of the discussion and part of the strategy to both protect workers and implement regulations.

Initiate conversations with union leaders. Everyone should take a fresh approach to the workplace and be open to questions and conversations about how to best proceed.

Negotiating power is now in favor of management, but now is not the time for leaders to take unfair advantage of the current high unemployment. Leaders can use this leverage to implement long-needed changes, restructure organizational charts, and change workspaces. But remember that it won’t be long until the pendulum swings the other way and there will again be a shortage of available talented labor.

Challenge: Assess FMLA/Self-Quarantine Policies/Health Care/Mental Heath

Family Medical Leave Act policies were created to help employees balance their work and family obligations, as well as create equal opportunities for men and women. While important, FMLA was not developed to cover the impact of a pandemic.

Opportunity: Health and mental care needs and costs are likely to increase. The good news is there is time to conduct analysis now in preparation for the upcoming enrollment period in October and November. As employees return to work, most are willing to accept a new normal, and this is a great time to solicit input into new policies. Leaders need to initiate and foster dialogue about what is important to their employees to increase employee engagement and satisfaction.

Legal requirements such as FMLA are on the forefront of human resources conversations. This time can be used to ensure that employees understand not only FMLA, but all employer-provided benefits. Increased scrutiny of current and future policies, and appropriate communication of all care options, reduces the potential of litigation.

It is likely that many employees will have a lingering mental health concern resulting from the challenges of this pandemic season. People have been physically ill, caring for ill family members, and experiencing worry and anxiety about work, finances, and health. It is important to remember that each employee will deal with the mental health implications differently.

Solution: Review the FMLA policies as it relates to mental health, and ensure that the proper resources are available to both aid employees and protect the company from future legal challenges. Work with HR, medical experts, finance, and other vested parties to create a financially viable plan to address the COVID-19 and post-COVID-19 working environments. Determine what redundancies are needed to accommodate employees if self-quarantine decisions become the new social expectation.

Current health plans can and should be reviewed to ensure they meet the needs of employees and the financial realities of the company. Due diligence is critical. Rolling over existing plans maintains the status quo and may not provide what is needed. Brokers are desperate to make new offers in this period of instability. Even if the plan is to remain with the current broker it is prudent to pursue various bids to increase your negotiating strength, and you may find a better, lower-cost solution. Look closely at what may need to be addressed to cover mental health issues, COVID-19, self-quarantine, etc.

Challenge: Onboarding and Terminating Employees in Remote Environments

Historically, onboarding employees is an exciting process of meeting new team members, interactions with supervisors, and taking new employees out to lunch. Terminating employees was always conducted in person to show compassion when appropriate, and to mitigate any unfortunate reactions. With WFH, the positive benefits of onboarding in person and control mechanisms of terminating an employee, are gone.

Opportunity: With more employees successfully working from home, CEOs recognize the shortcomings of ad hoc communication about the who, what, when, where, and why relating to new and current employees who are not in the office. Employees are viewing this temporary change as their new permanent reality. They are asking questions about roles and responsibilities. Leaders must quickly answer these questions, shape the culture, and establish clean processes.

Being able to continue hiring and onboarding employees efficiently in a WFH or social distance environment is essential to the smooth running of the company. The ability to remotely terminate an employee is challenging. While uncomfortable, it must be done with care and safety.

Leaders should evaluate the positive impacts of in-person onboarding and outline ways to the replicate the benefits virtually as best as possible. For example, can other employees take a new employee “out” for a virtual lunch? Can a new employee have a detailed and organized schedule of online meetings with various department leaders and colleagues? Organizations have the opportunity to get creative with how they make new employees feel welcome and get them up to speed and productive as soon as possible.

Simultaneously, leaders need to determine how to best terminate an employee in a virtual setting while maintaining a sense of empathy and protecting the company brand. Employees can easily record virtual conversations and post them online—leaders should assume ALL conversations are being recorded. Technology policies and software resources need to be in place prior to termination to ensure online networks cannot be breached and company data cannot be stolen. Policies need to be in place with an inventory of what company property an employee has at their home, including computers, phones, hardware, documents, and any access to software, servers, cloud storage, or client lists. A procedure needs to be in place regarding who will travel to the employee’s home to collect any company property, or if the employee is responsible for returning property in-person or via a designated delivery service.

Non-compete and security policies need to be addressed so company information is not compromised.

Solution: HR, IT, and managers must work together to craft new and detailed plans for hiring, onboarding, and terminating. Poor onboarding experiences reduces employee performance, satisfaction, and retention. The risk of a poor termination exposes the company to high risk and liability if passwords, technology, company assets, and internal communication are not safeguarded.

Challenge: Recognizing Employee Service and Contributions

While working from home, employees do not receive formal and informal feedback from colleagues on a job well done, and thus, there is often increased uncertainty for an employee’s job performance.

Opportunity: Employees are looking for leadership. Leaders need to be more engaged with workers during times of crisis. Even the most self-motivated employees need more frequent communication, encouragement, and feedback for high-stress environments.

A leader can mitigate stress and the unknown with genuine, authentic, consistent, and more frequent communication. Leaders should model this communication and feedback to direct reports and express the expectation that managers should provide similar feedback to all employees.

When engaging with employees, evaluate what feedback mechanisms worked best prior to the work interruptions and what worked well in the virtual environment. Combine the best practices to create a new and more meaningful means of recognizing service and contributions.

Solution: Connect on a more personal level. Increase the frequency and visibility of employee recognition activities. Recognition does not need to involve a bonus. The key is not taking employees for granted. Meet and exceed expectations for feedback. Commit to awards, celebrations, annual reviews, and salary adjustments. Remember that individual people need individual attention. People are unique and they value different types of recognition. Some need words of affirmation—some prefer privately and not publically— to keep them engaged, others prefer monetary rewards or thank you gifts, and some might value extra paid time off.