Think at London Business School
Key ways to win in the 'new normal'
By Michael G Jacobides, Martin Reeves
Covid-19 accelerated existing workplace trends and created many new challenges. So where are we now – and what’s next?
My passion has been the future of work – so I guess in that sense my time has come. I began more than a decade ago by launching, at my advisory group HSM, The Future of Work Research consortium, which has since brought together executives from more than 100 multinationals across the globe to debate and imagine the future.
I followed this up in 2011 with the publication of The Shift: The Future of Work is Already Here , and five years ago developed an elective at London Business School (LBS) on the future of work. It has been a topic that has been very much on my mind.
Over the decade that followed were a number of standout headlines. The accelerating rate of technological innovation which will sweep aside tasks that can be easily automated – leaving an emphasis on human skills from emotional empathy to cognitive judgement and decision-making. The extraordinary increases in life expectancy – up to two years per decade – accompanied by the substantial decrease in family size, together creating a demographic transition of a rapidly aging population.
The globalisation of the world’s manufacturing and supply networks and, more recently, of talent pools with a constant move from rural to urban centres. The speed with which women have entered the labour market, occasionally assuming leadership positions and creating dual-career families where traditional parental roles are being renegotiated. And, overhanging much of this, an increasing need to accelerate the energy transition.
Looking back at The Shift I feel that I was on track with some of my ideas – the speed of technology, the impact of the family – but what I failed to foresee at that time was the speed with which inequality would rise. And, of course, the word “pandemic” was missing from the index.
From 2014 I teamed up with my LBS colleague Andrew Scott (a macroeconomist) to explore what these changes would mean for individuals, corporations and governments. Together we wrote two books – The 100-Year Life: Living and Working in an Age of Longevity (published in 2016) and The New Long Life: A Framework for Flourishing in a Changing World (published in 2020).
By this time, much was already in play. The plan of life was moving from three stages of fulltime education, work and retirement to something more like a multi-stage model requiring a great deal more flexibility, individual choice and navigation.
At the same time, basic stereotypes – about ageing and the malleability of age, about parental roles and responsibilities, and about working practices – were being questioned. Inevitably, the idea of “lifelong learning and exploring” was becoming a desirable if not crucial outcome.
Enter the pandemic. This both accelerated these established trends and brought into sharp relief important new issues and judgement calls. To understand and recall this trajectory, I’ve kept a diary from the beginning of lockdown – which for me was Tuesday 17 March.
On that first day, the standout events were two rapid-response virtual meetings convened with my fellow stewards of the World Economic Forum’s (WEF) Council for The Future of Work and Education and a wider group of experts. On the call were representatives from government, civil society, companies and academia. As one senior executive based in China remarked, “I used to travel a lot from Hong Kong to Beijing. I’ve found out I can do four or five meetings a day without travelling – my productivity has increased. Will I ever travel every week again?”
Looking back, this was an early indication that working from home could have profound implications on working styles and also began to show how unlikely it would be that we’d go back to the pre-Covid ways of working.
Next was the observation from Guy Ryder, Director General of the International Labour Organisation, that, “We have to create social protection for vulnerable workers – that means health and safety, healthcare, sick pay – we have to recover better.” Again, a theme that continues to resonate.
And a positive note from Jeff Maggioncalda, CEO of online education platform Coursera, who described how the experience of Covid had amplified learning new skills and created greater skill elasticity. Enrolment in China, Japan and Italy was up by over 300% – with courses on public health dominating. It was clear that new learning habits were being created and people were embracing the digital and being more innovative, creative and collaborative.
“There has been an amazing amount of sharing; for example, ‘how do you run a virtual class?’ It’s a new spirit of accepting new things.”
My notes to myself on that day finished with: “Feeling fine, back hurts, only 12 minutes of exercise and 2,804 steps.” It had been a sedentary day.
The next day began with a webinar at LBS on virtual working, when I surveyed almost 3,000 participants on their experiences of home working. Some surprises – only 2% said, “I find the technology frustrating.”
It seemed the technology was holding up remarkably well, yet the poll also revealed a clue to something that would continue to exercise my attention. By far the largest percentage (46%) spoke of their social isolation, choosing the phrase, “It works OK, but I miss the social interaction of the office” as their main feeling.
During the days, weeks and months that followed there were indeed accelerations – of digital skills as we all became “digital natives”; of finding new ways to work from home and (sort of) manage the distractions; and of enjoying the new-found flexibility of time and place. Indeed, it’s no surprise that, in a poll I’ve run throughout lockdown and in the survey I have conducted, less than 10% say, “I want to get back to the old way of working.”
It’s now 2021, we have deep experience of lockdown, and – for those in the northern hemisphere – are only just coming out of a long winter with the possibility of further restrictions ahead of us.
When so many of us say we want to build back better, what does that look like? My focus is on new ways of working – what might they look like? I’ve been thinking about this by imagining the pre-Covid company as “frozen”. We can think of the current state as likely to be “unfrozen”, in the sense that many fundamental assumptions about what work is have changed – including the role of a leader, how we manage time, the role of an office.
The next stage will be something like “refreeze”, when new crystals metaphorically begin to form around new systems and routines. In thinking about what this might look like, here is how I am currently framing it:
Organisations have become extraordinary Petri dishes of experiments. I’ve captured some of these through my research over the last six months and have been fascinated by those who address the challenge of social connectivity. Since lockdown, most of us are spending more time with others we know well and, as a result, our networks are shrinking. Moreover, working from home means the serendipitous “water-cooler” conversations so crucial to innovation are no longer taking place.
Some companies have experimented with moderated communication platforms to try and recreate these serendipitous conversations. That’s what executives at global law firm Dentons had in mind when they launched their Big Inclusion Project with an all-hands, 72-hour, online brainstorming event. Connecting people across the whole firm generated more than 3,000 actions and ideas and made a host of new connections and conversations. I’m currently working with a number of other companies who are building the technological equivalent of serendipity.
Anne Sheehan, who heads up Vodafone’s UK business, took a rather different approach. In March the business had pivoted in less than a week from a primarily office-based employee group to a home-based workforce. Anne quickly realised that people missed the sociability and serendipitous interactions of the office environment, so she launched an informal programme called "Sandwich with Anne".
As she told me at the time, “Twice a week I invite 12 employees for lunch, each from a different area of the company – for instance, marketing and digital. We send each invitee a sandwich lunch at their home address, then around 1pm, we sit down for a virtual lunch and talk for about an hour.” Her goal was to break barriers by being open and removing any intimidation about meeting with her.
It could well be that initiatives like these will have relatively short shelf lives, but that’s not the point – what will be crucial going forward is for companies to be vigilant about new ways to address emerging challenges and to be prepared to continually fine-tune responses.
It turns out that changing our office/work habits had all sorts of intended and unintended consequences. Many people certainly enjoyed the time and location flexibility that it brought. But it also revealed a host of other issues. I heard about some of these in the HSM webinar I ran in April when I polled executives from more than 30 companies in Europe, the US, Japan, Australia and New Zealand. I followed this up with a seven-day hackathon to brainstorm solutions.
It was clear that the disintegration of work/home boundaries was having profound impacts. People spoke about how they typically managed their working lives (particularly when their identities of, say, hard-hitting salesperson and caring father were distinct) pre-pandemic by creating boundaries between the two domains. In a sense, they were building mental fences often facilitated by clear transitions and “ritual” activities – putting on a suit, getting on the commuter train, having a pre-meeting coffee, catching up with the morning paper.
It turns out that these transitional rituals helped to separate and preserve their distinct selves and provide the means for temporal, cognitive and relational shifts. Maintaining these boundaries, instead of blurring the line between being “on” for a role and “off” meant that distraction was minimised and creativity and flow could happen more quickly.
During lockdown these boundaries dissolved and in the place of two transitions (home to work, work to home) there were now multiple transitions (work, look after a child, work, prepare lunch, work, play with infant, etc), with each transition adversely affecting concentration and productivity and, ultimately, creativity.
It seems to me that, in the long term, home can be a place of energy and relaxation. Freed from a long commute, we can spend more time exercising, with our family, learning new skills. But to do that firms will have to focus less on presenteeism and more on productivity. And we workers will have to understand better how to control our boundaries between being “always on” and “never off”.
That leaves an important question – what, then, is the office for? I debated this with Jenni Emery, a senior executive from design firm Arup. Jenni spoke about the need to acknowledge and balance the significant tension between the near-term and the long-term actions. Right now, any ideas about what an office is for have to be seen through the lens of current health and safety restrictions. Yet, in the longer term, answers will inevitably focus on building new, creative ways to reimagine office space that create places where people can congregate, learn from each other, mingle, converse, share ideas.
Lifelong learning was top of my agenda before the pandemic. But, as a major recession bites, which could see more than a quarter of a billion people unemployed, it will become ever more crucial.
‘Simply relying on human agency will not be enough ... companies will have to be prepared to step up’
The words of Jeff Maggioncalda at that meeting on 17 March are heartening, and since then many people have used their new-found digital skills to attend online education, while experiments conducted by universities and business schools (including our own) have made the process more productive and enjoyable.
Yet, looking forward, simply relying on human agency will not be enough. As Guy Ryder said in that same meeting, “We have to recover better.” In that recovery, governments will play a role and, in The New Long Life, Andrew and I described what we believed should be the government agenda. But that leaves a very significant role for companies, which have to be prepared to step up to support both their own employees and those in their supply chains and wider communities.
All this is made more urgent because of a challenge that has been two decades in the making; namely the decline and stagnation in employer investments in training. It will take courage for companies to make the size of commitments that will be necessary. Some are already doing this.
Take the advisory practice PwC, which, in late 2019, announced it was investing $3 billion in training its employees – supporting classroom teaching, developing digital training tools, deploying people to community projects, and leveraging existing partnerships with the United Nations and the WEF. Earlier this year, PwC announced a partnership with Unicef to help upskill millions of young people around the world. This is part of the WEF Reskilling Revolution Platform, which has committed to providing better jobs, education and skills to one billion people in the next 10 years.
Last June Microsoft launched its global skills initiative, with the goal of bringing more digital skills to 25 million people worldwide by the end of 2020. This combined existing and new resources from LinkedIn, GitHub and Microsoft, and used data to identify for job seekers in-demand jobs and the necessary skills. It also provided free access to learning paths and enabled low-cost certifications and free job-seeking tools.
In addition, Microsoft made $20 million in cash grants available to help non-profit organisations worldwide assist the people who need the grants most.
These are significant numbers, but it will take many more initiatives of this scale and courage to address the growing issues of unemployment and inequality.
Late in October I became the co-chair of the WEF Council on Work, Wages and Job Creation. In early council meetings what came across clearly was the need not only to help workers prepare for work, but also to actively create jobs, particularly for the young. A clear implication was that this could only be achieved by a multi-stakeholder initiative that brings together governments, companies, educators, social ventures and civil society. That is what I am committed to do and I believe that the convening power of the WEF has the potential to make a real difference.
Inevitably in the coming months companies will be forced to make many judgement calls, with dilemmas to face and competing demands to consider. For example: How do we manage home/office flexibility – who should be in the office and who should work from home? How do we build a system of time flexibility that acknowledges the caring responsibilities of parents of young children without disadvantaging those who don’t have caring responsibilities? Which tasks should be replaced with automation? How can we be sure that people working from home are considered for promotion?
At the heart of all these judgement calls are notions of fairness that inevitably will be sorely tested. For example, in the flexible rota that is developed for those with young children, people will inevitably wonder, “Have I been treated fairly. Is the outcome fair? Was the procedure used to develop the outcome fair? Was I treated fairly in my interactions with managers and colleagues?”
There will be significant benefits to getting this right – people will be more engaged with their work, more likely to cooperate with others, more likely to stay and less likely to feel aggrieved. Looking forward, these are all benefits that will be crucial to navigating the months ahead.
Yet my research shows that the reality of Covid is that resources are stretched – managers feel pressured to make decisions very quickly and, as a consequence, are failing to represent the needs of everyone involved.
Moreover, as many are working remotely, they are less able to help people understand why the decision has been made, to treat people with respect and to be honest about the implications.
And, as they are also more isolated, managers have fewer opportunities for informal conversations with their colleagues and peers about their experiences. The combination of time stress, uncertainty and isolation means that people are less likely to experience fairness. And the impact of feelings of unfairness are profound – anger, frustration and, ultimately, withdrawal.
Over the coming months it will be more crucial than ever to make real efforts to engage people directly in a conversation about the choices and trade-offs they face, to listen and share stories that frame their dilemmas, and to engage in a wider process of co-creating the future of work. We’ve all developed bad working habits – scheduled too many meetings, too much travel, too little time with our families. Our carbon footprints, as well as the wear and tear on our mental health, have warned us that many aspects of our way of working was wrong. But these working habits were deeply ingrained and hard to shift.
That’s changed fast. This moment has given us an opportunity to shift and reset how we work. Let’s do everything in our power to make sure that we don’t waste this precious opportunity.
Think at London Business School
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Our live virtual learning model has been carefully designed to give you the best of both world: join expert faculty delivering our world-class programmes live in London from the comfort of your own home. You'll also have the opportunity to reinforce your learning by joining us on campus in the near future for an exclusive day featuring the latest thinking from our world-class faculty and network with like-minded professionals.READ MORE