This second part to the ‘New Normal’ blog summarises my reflections from hundreds of conversations had in lockdown with friends, family, clients, candidates, strangers, basically anyone who will speak to me. It has been really interesting to hear how businesses, and individuals, have been coping with the challenges that currently present themselves in these strange times.

Survival 

Most of us are in some sort of survival mode (perhaps this is where the ‘Stay Alert’ moniker comes from) – living day to day without much in the way of medium to long term future planning.  This applies to businesses as well as individuals.  This section will cover off staff related initiatives that businesses are doing in order to survive. 

The first thing we saw as recruitment consultants is the dreaded recruitment freeze. This happens at other times, but it is usually limited to one or two engagements. It reminded me of the lights going out on the dating game show ‘Take me Out’ (with the accompanying noise) as all our engagements shut down within a very short space of time. At this stage most businesses are looking at cost control (and cost reduction) in order to preserve their cash reserves. It is likely that these recruitment freezes will remain for the foreseeable future, particularly until furlough is finished. It may not be good to have new people starting whilst some of the existing team are furloughed and confidence (and revenue) is moving in the right direction.

That said, we have had several successful starters during lockdown. We had one candidate who managed to get 4 days of face-to-face time with their new team before lockdown. We have had a number of others that have successfully started in new roles while in lockdown and whilst there have been some minor technical issues these have all been overcome. Some employers may be considering new ways to assess candidates, one client offered a candidate a one month contract with a view to a permanent role. This wouldn’t work for all candidates but in this particular case it worked for all parties – it is effectively a month long final interview, for which the candidate is getting paid.

There is a lot to be said about furlough. The Job Retention Scheme seems like a good idea – helping businesses to support their workforce when business is struggling or unable to operate. Some businesses have embraced this help, others have felt politically unable to use the scheme, and other businesses have used it to public outrage as their actions are seen as going against the spirit of who it was intended to help.

Furlough itself, for such a simple word, does carry a myriad of complexity. I have spoken to some who are delighted to have been placed on furlough – getting paid to not work and use the time to get other jobs done or just laze around and watch Netflix! It is a great time to invest in your personal development, I know of a few people who are doing online courses to help their career (technical or softer skills) or learning new skills (guitar playing or photography). Some who have been furloughed are experiencing negative feelings, they feel less valued by their employers and have concerns about if, and when, they will return.

Those who are still working, particularly if their colleagues have been furloughed, can also experience mixed emotions. There are some that are feeling particularly stretched, having to pick up on responsibilities usually covered off by furloughed colleagues or fielding additional requests on the back of planning for the recovery. There is unlikely to be additional funds available to reward this effort. In addition, they may be seeing their furloughed colleagues who are not financially disadvantaged having a pretty good time of it (an advantage of not following work colleagues on social media!). Some who are working may be pleased that they are seen to be of value to the business and happy that they are not ‘out of sight, out of mind’.

Who to furlough is also a challenge – the scheme is covering 80% of monthly salary, up to a maximum value of £2,500, so it may steer the selection away from experienced staff towards more junior recruits. Some businesses are deliberately being equitable with who to furlough in order to address some of the issues already outlined. This could mean furloughing half the team for 4 weeks and the other half for 4 weeks to ensure that everyone has been furloughed, regardless of grade and function. That could work well if workload typically involves relatively short-term projects and you have cover for niche roles.

Some businesses who are having to furlough staff earning over the £2,500 threshold have a challenge around maintaining salaries. It is typically the case that people adjust their lifestyle to work within their financial means and there may be significant mortgage costs that a number of staff over the threshold may have to meet before they think about other household bills. Some companies are topping up salary to ensure that their staff are not out of pocket, but this is a cost that the business must meet against a backdrop of reduced revenue. Such businesses will typically have strong cash reserves, ongoing income that has been resilient to the crisis, or a confidence in business picking up pretty quickly after lockdown rules are relaxed.

Other businesses I have spoken to have asked their staff to take a cut in salary for a period of time – this could be a flat percentage, or it could be a stepped reduction, depending on current salary and grade. It is not just the short-term impact on people’s earning potential as it could also be how this pandemic impacts wages growth in the future. Another option has been to encourage people to drop the number of days they do, from 5 a week to 4, for example.

Many people will have given up their planned holidays at Easter, May half term and the summer break, which means that there will be significant amounts of unused holiday. I speculate that there will be a general reluctance for people to use holiday up when in lock down. Businesses are encouraging working staff to use up holiday for a number of reasons. Firstly, having a break from work is necessary, although I am sure front-line workers are not able to take holiday at the moment. Secondly, businesses cannot recover if large swathes of their workforce are on holiday. Finally, some businesses operate holiday carry over and the ability to exchange any unused holiday for cash. This is clearly a liability that most businesses would wish to to avoid, reducing valuable cash reserves in order to service.

Triumph (and failure) in times of adversity 

Advanced planning for mitigating impact of a catastrophic episode such as Covid-19 on business is an impossible challenge, but it has been really interesting to see how businesses react in times of adversity. Of course, most businesses have a disaster recovery plan in case of a significant event that was to impact their business. But it usually focuses on IT infrastructure and assumes there are no impacts on external factors such as other businesses or consumers.  Inevitably this Corona-jolt to the economy will have repercussions in terms of the future viability of a number of businesses.  This will accelerate the pace of change and potentially compress 5 years’ worth of change into a few months.   

In the retail sector, businesses already struggling with an outdated offer, a bloated store footprint more aligned to consumer demands of days gone by, in a market better served by more agile, online players, will no longer find relevance, post-Covid-19.  This will be a case of ‘survival of the fittest’ where very few consumer facing businesses will be immune. 

Business leaders now, more than ever, need to find clarity in their communication, not only to customers but to their workforce.  Clarity is needed on the vision and strategy required to return to former glories (which in uncertain times is easier said than done). There will inevitably be some bumps along the road, but this clarity and confidence will engage and motivate the workforce.  I recall my time at CACI, when we lost a colleague in extremely tragic circumstances and this loss resonated throughout the office.  The leadership team engaged immediately and it was their actions throughout that ensured the impact was minimised.  Whilst nothing could replace the loss of a beloved colleague, such a tragic event galvanised the team and brought us closer together, a real triumph in the face of adversity. 

This crisis has enabled competitive collaboration between businesses in a range of sectors.  In the early days of the pandemic the Grocers were sharing resources between each other and collaborating to ensure that the nations shelves remained stocked. The highly competitive gym industry, with a range of different players, were sharing information in their support of each other and providing, where appropriate, resources to a combined lobby group where there was a collective interest. 

I have spoken to a number of employees who have been working closely with colleagues in other departments, often with people they haven’t really had prior dealings with before.  I have also learnt of redeployments (or secondments) from one department to another.  These types of initiative will certainly help employees gain a deeper understanding of different functions and allow new internal relationships to be formed. 

So in conclusion, the resilient, forward thinking businesses who can act fast to challenges, should survive but it will undoubtedly be a difficult time to all businesses across all industries.

If your team is struggling and you need short term or long term support, please speak to us. We are well placed to suggest suitable candidates and acting fast to get extra resource could be vital to your success.

Give us a call on +44(0)7918 653 877 / +44(0)7979 756 257 or email info@redtigerconsulting.co.uk.

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