During an Economic Recovery, Brands Need to Teach their Employees to Look Beyond the Recession as a Rite of Passage

Going To War
“Great ambition is the passion of a great character. Those endowed with it may perform very good or very bad acts. All depends on the principles which direct them.” -Napoleon Bonaparte

The recovery from 2008’s Great Recession has been a slow one, especially in Detroit where the nation has been reminded through films, television, books and news articles of its vulnerable state.

But there have been signs of life. For example, according to the Bureau of Labor Statistics, employment for the Detroit-Metropolitan Area stood at 1,862,000, up 19,800 or 1.1 percent over the year. Despite Detroit trailing the national job count by .6 percent, Detroit-Metropolitan area job growth continued the trend of over-the-year gains that began in May 2010.

Furthermore, the Automotive Industry seems to be clawing itself back to pre-2008 levels.  Bloomberg reported November U.S. auto sales have accelerated to the fastest pace in more than five years.

Additionally, via this year’s Recruiting Trends report, there has been a nearly 10% increase in the number of employers planning to hire college graduates with a bachelor’s degree, with a strong demand for accounting, marketing, computer science, engineering, human resources and public relations.

Despite the advancements we’ve made in moving the economic chains, the foundational intangibles that breed a successful industry are on shaky ground and a new recession, a cultural recession may be upon us.

The Forgotten Man: Your Corporate Culture

Profitable brands continue to act as if they remain undercapitalized and overexposed in the post-recession world. While the financial analysts can appreciate conservative spending, it’s not the quota on office supplies that prove troublesome.

The 10-ton elephant in the room revolves around the danger of regressive corporate cultures. With an unprecedented 2.6 million jobs lost in 2008, the recession projected the feeling of television and Vietnam. The war being fought in one’s living room was being played in fluorescent lit, windowless conference rooms across America. For carmakers and their employees, the long-term impact was simply put, worse. Complete with compensation reductions that eliminated merit pay, bonuses and matching contributions for white-collar workers, little could be done to prevent thousands at a time from losing their jobs.

To those who survived the layoffs, a resolve was formed, and with it an attitude that was analogous to going to war. While in some cases that took the appearance of  “Per Angusta Ad Augusta”, the reality in some circles was more “Et tu, Brute?”

Fast-forward nearly six years and while most states still have a long ways to go before payrolls return to pre-recession levels (In November unemployment rates declined 7 percent), the trend is moving upwards and a new crop of talented employees eager to contribute are coming aboard, joining the battle worn existing staff.

With expectations running high, these new entries into established employers run the risk of being set up to fail, and they’re voicing their opinions in the process. For example, in March of 2013, a study conducted by Kelton titled “America’s Workforce:  A Revealing Account of What U.S. Employees Really Think About Today’s Workplace.” analyzed the responses of more than 1,000 U.S.-based employees, uncovering where employees would like to see change from the companies they work for and the leaders who manage them. Seven key themes surfaced in the survey including leadership competencies, manager/employee relationships, communication of strategy, change initiatives, teamwork and accountability, process improvements, and employee training.

The America’s Workforce study found:

  • Employee’s Feel Discouraged:  More than half (54%) of employees have felt frustrated about work.
  • Manager/Employee Relationships Need Improvement:  Only 38% strongly agree that their manager has established an effective working relationship with them.
  • People Don’t Understand Strategic Direction:  40% say they don’t get the company’s vision or have never seen it.
  • Innovation Is Being Stymied:  Nearly 67% of American workers can name at least one thing that would prevent them from taking any kind of risk at work.
  • Big Picture Contributions Missing:  Only 43% of workers say they feel accountable for the company’s revenue, profit, or growth.
  • Not Leading by Example:  Just 26% of workers strongly agree that managers embody the values they expect from their employees, only 39% say their manager understands his/her role at the company, and 40% strongly feel their managers understand their company’s strategy or goals.
  • Collaboration Across Teams Is Tough:  Just 27% strongly feel they can depend on outsiders to fulfill their duties when working with other groups.
  • Training Isn’t Relevant:  26% report they don’t have any training available to them right now, and the 62% that do have training available believe it is either somewhat or not at all applicable to their jobs.

Explaining Going To War

It’s evident that the Going To War mentality is a danger to retaining employees in an upswing market. I’ve described four main categories of Going To War and its corporate implications below.

Been To War

Referred to as a “Band of Brothers” who, in small circles, are allowed to unapologetically wreak havoc on incoming team members without ramification or remorse. Leadership often turns a blind eye to their antics because of the gratitude they have for remaining loyal during difficult economic times. For all intent and purpose, these are the problem children, the ones that drag culture, innovation and productivity into the ground.

Drafted To Fight

This is the group who may have joined directly out of college, fresh faced and willing to accept the status quo as normal behavior in a work environment. Nearly six years removed from the Great Recession, they’re now growing into positions of gained responsibilities, but have been taught less than ideal ways to grow a department without teamwork. They are trusted implicitly by those who have “Been to War” and can usurp the hierarchal nature of direct management based on the close relationships they’ve developed with managers of greater power and influence. While not malicious, their loyalty and behaviors are easily persuaded to non-ideal standards, stunting cultural growth.

Enlisted to Perform

They fell in love with the brand’s ideals and sacrificed (in some instances rational thinking) to join their company blindly. Those who enlisted may have been coming back into the workforce but for many, they left existing careers seeking to contribute to a larger cause. These are the change agents who romanticized industries such as automotive, hoping to be a factor in the Great American Turnaround story and with them brought new ideas to the table. Unfortunately in the environment they’ve joined, the stomach for innovation is minimal, with a risk adverse philosophy hanging over their heads. As their passions wane, they’ve come to accept that no form of change can match the lack of top-down leadership in governing the intangibles necessary to be successful and now seek new opportunities after short stays with their employers.

Post-War Participants

Post-War Participants simply have limited reference to 2008’s dire environment. They could be just graduating college, or coming from different industries that may have faired better than the one they’re joining. Their voice may be loud but it’s rarely heard. Having never been to war, their hierarchal place amongst their colleagues is in the periphery where it remains without consequence or care.

The Bottom Line

Having a job in today’s environment simply isn’t enough to retain your employees. For example, a recent Harris survey for the University of Phoenix found that 80% of workers in their 20s say they want to change careers, compared to 64% of 30-somethings and 54% in their 40s. Furthermore, a Gallup poll says 52% of full-time workers are disengaged, costing US companies from $450 billion to $550 billion every year.

Yet there are examples of companies today that have exemplified growth through a positive culture, specifically by engaging their employees.

Google is the poster child for one of the world’s best companies to work for. Sitting atop $48 billion in cash, Google can afford to offer the type of amazing benefits once enjoyed by other industries such as airlines and automotive.

It’s easy to concede that not every company is Google. On the opposite end of the spectrum there are low margin companies that thrive, such as Costco. A company that offers good compensation and benefits, Costco’s co-founder and former CEO Jim Sinegal  said in an interview with Motley Fool that “…culture is not the most important thing in the world. It’s the only thing.”

By taking their culture seriously and making it a top-down priority, Costco keeps low employee turnover by reinforcing their love for their employees, encouraging them to grow with the company. In an industry with no annuities – consumers can choose whether to shop with Costco, they have weathered the financial storm of six years ago and are thriving, proving their inventory turns over but not those who present it.

Conversely, in a negative environment, when new employees leave for greener pastures, the typical reaction is “He/She couldn’t cut it in our culture.”

But as proven, cultural recessions and the Going To War mentality are hitting companies where it hurts the most: their wallets.

Follow Craig on twitter at @craigdaitch

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