To say that one of the most obvious characteristics of 2022 is that we are accustomed to the unexpected. Just when major companies breathed a sigh of relief because the darkest hour of the new crown epidemic is coming to an end, the Russia-Ukraine conflict broke out. Then came the summer and, unfortunately, global climate change records, from rising temperatures all the way to rising sea levels, followed by worsening inflation in the fourth quarter.
Unfortunately, 2023 is unlikely to be any better.
From Fortune’s conversations with more than two dozen CEOs, one thing is clear: The roads in 2023 will be bumpy, so buckle up.
The buzzwords of 2022, such as telecommuting and flexible working regimes, feel irrelevant to the challenges posed by wars, recessions and global upheavals, yet what is certain is that while people cannot control the external turmoil affecting their businesses, they still Be able to control your own responses.
“Retirement re-employment wave” and intergenerational conflict
As the cost of energy, mortgage repayments and food continues to grow, more and more older workers can no longer afford to retire and are changing their retirement plans, with some even returning to work.
A third of people who could have retired in the next five years are adjusting their plans due to the cost of living crisis, research by Royal London has revealed.
James Reid, chief executive and chairman of the British headhunting company Reed, said that although the phenomenon of major companies recruiting employees over the age of 50 has become an “encouraging trend”, managers must first be involved in the recruitment and retention process. Overcome age bias.
“Companies should not underestimate the skills of older workers, which include unique but invaluable insight into workplace decisions and a wealth of experience. Older workers are invaluable, and companies should think about how to creatively appeal to this group.”
To do this, businesses may need to move away from current screening processes or lengthy online application procedures, which can be deeply “inconvenient” for older workers.
Managers also expressed concern about a generational workforce, as Gen Z has become a major force in the workplace as companies welcome retiring workers.
Managers will need to communicate differently and create a culture that respects opposing viewpoints to avoid any intergenerational conflict in 2023.
short term solution
Sierra Ashman, global chief executive of Wolff Olins, warns: “In times of uncertainty, people tend to revert to the old ways that are familiar to them and have worked well before. .”
Many, besides her, worry that the global recession will cause businesses to stagnate and choose solutions that will work in the short term over innovation.
Will Higham, author and chief executive of strategy consultancy Next Big Thing, agrees, saying: “My concern is that a lot of companies this year will focus on what works in the short term, whether it’s dealing with internal or external threats. ’” He added: “In a protracted crisis, it’s not uncommon for businesses that are struggling to take this step.”
Managers tend to scale back spending on technology-driven innovation, or go the other way, introducing technology at the expense of jobs in the short term.
Before making any drastic layoffs, though, managers would do well to figure out where the money is best aligned with the company’s long-term vision.
If managers fail to carefully balance management costs and deliver a fair return to their shareholders in the short term, and instead place their future and the execution of their business strategy on big bets, they may eventually find themselves facing unnecessary scrutiny and You may lose your job as a result.
Balancing cost increases from ESG
Many companies have made ESG (environmental, social and governance) commitments during the COVID-19 pandemic, so we often see many CEOs worrying about how to maintain these commitments during the economic downturn.
The twin pressures to cut costs and reduce environmental impact mean managers are doing more with less.
That’s why a group of leaders, including Ana Paula Assis, managing director and chairman of IBM’s EMEA region, are advising companies to use technology to save money and operate sustainably.
“By investing in technologies such as the automation and modernization of IT infrastructure, companies can increase efficiency and create related initiatives around circular supply chains, a sound energy transition and consumer empowerment,” she said.
Joni Lautavoli, chief executive of manufacturer Tharsus Group, responded that with “the right investments in flexible automation,” companies could better implement long-term strategies and compete globally. On that note, he also noted that sustainability and productivity are “key”.
At the same time, employees (consumers) will not be forgiven by employers who abandon their corporate governance philosophy in ESG codes due to economic adversity.
“It’s going to be all the more difficult given the rising cost of living and ongoing hiring difficulties,” said Amali de Alves, chief executive of climate investment firm Subak.
Committing to purpose-driven commitments can range from keeping the office area breakfast room during The Great Resignation to something more serious like a salary increase to better deal with rising costs of living.
CEOs like Alves are keenly aware that people-centric initiatives will struggle to keep pace with “an environment of rising operating costs and low consumer willingness to buy.”
Like companies, workers themselves are cutting back and going through their downturns, but some employees are willing to leave if employers aren’t willing to provide them with a cushion to do so. (Fortune Chinese website)
Translator: Feng Feng
Reviewer: Xia Lin
If 2022 proved anything, it’s to expect the unexpected. Just as businesses breathed a sigh of relief at the prospect of the worst of the pandemic being over, Russia invaded Ukraine. Then summer came and the world sadly smashed climate change records, from rising temperature to sea levels, before inflation spiraled in Q4.
Unfortunately, 2023 is unlikely to go any smoother.
From Fortune’s conversations with over 20 chief executives, one thing is clear: 2023 is going to be a bumpy ride, so buckle up.
Last year’s buzzwords like remote and flexible working feel like a world away from the challenges that war, recession and global turbulence will bring, but rest assured that while you cannot control the external chaos impacting your business, you can control your response.
The “Great Unretirement” and generational clashes
As the cost of energy, mortgage repayments and food increases, an increasing number of older workers can’t afford to retire and as such are changing their retirement plans – with some retirees even choosing to return to work.
Research, by Royal London, found that a third of those who would have retired in the next 5 years are changing their plans because of the cost of living crisis.
The CEO and chair of UK recruitment firm Reed, James Reed, says that although businesses hiring people over 50 is an “encouraging trend”, leaders must first overcome ageism bias in hiring and retention.
“The skill set that older workers offer, including a different yet valuable perspective on workplace decisions and a substantial level of experience, should not be understated. Older workers are invaluable, and companies should think creatively about appealing to this group.”
This might mean throwing out current screening processes or lengthy online applications which can cause “frustration” among older workers.
Leaders also expressed concern at the multigenerational workforce that comes as a result of embracing unretiring workers at the same time as Gen Z shakes up the working world.
Leaders will need to cater to different communication styles and command a culture that embraces respecting opposing views, to avoid any generational clashes in 2023.
Short-term fixes
“Uncertain times tend to breed a return to what feels familiar and has worked previously,” warns Sairah Ashman, global CEO of the ad agency Wolff Olins.
She wasn’t alone in being concerned that a global recession will result in businesses stagnating and opting for short-term solutions over innovative.
“I worry that too many businesses will focus on short-term fixes this year: externally and internally,” Will Higham, author and CEO at the strategy consultancy, Next Big Thing agrees while adding that “it’s a natural reaction in a permacis when every day’s a struggle.”
Leaders may be tempted to scale back on technology-driven innovations, or go the other way and introduce tech at the expense of human jobs to save money in the short term.
But really, before making any drastic cuts, leaders would be wise to work out where investment is best spent in line with their long-term vision.
Those who don’t carefully balance managing costs in the short-term and delivering a fair return for their shareholders, with making bets that will secure their future and deliver on the business’ strategy, “risk finding themselves under unwanted scrutiny that could lead to their exit,” Ashman adds.
Balancing rising costs with ESG
Many businesses made ESG (environmental, social, and corporate governance) commitments during the pandemic, so it’s not surprising that many CEOs are concerned about keeping those promises in the face of a downturn.
The double whammy pressure of keeping costs down while reducing their environmental footprint means leaders will need to do more with less.
As such, a handful of leaders including Ana Paula Assis, IBM’s general manager and chair EMEA, advise firms to lean on tech to save money and operate more sustainably.
“By investing in technologies such as automation and modernization of IT infrastructures, companies can drive efficiency while developing initiatives around circular supply chains, just energy transition and the empowerment of consumers,” she said.
Joni Rautavuori, CEO of the manufacturer Tharsus Group, echoed that with “the right investment in flexible automation” businesses could better deliver on long-term strategies and compete on a global stage – for which he adds that sustainability and productivity are “key”.
Meanwhile, employers who forgo the social governance aspect of their ESG credentials won’t be forgiven by employees (or consumers) despite the economic headwinds.
“This is particularly going to be a hard one to square with the increased cost of living and a continuing recruitment challenge,” says Amali de Alwis, CEO of the climate investment firm, Subak.
Committing to purpose-driven promises could range from keeping that in-office breakfast bar introduced during The Great Resignation, to more serious matters like raising workers’ wages to better cope with the increased cost of living.
Chief executives, like Alwis are acutely aware that people-first measures are going to be hard to keep up with “against a backdrop of increased operating costs and muted consumer appetite”.
Just like businesses, workers are experiencing cutbacks and depression – but some will be willing to walk out on employers who won’t cushion that blow.
This article is reproduced from: https://www.fortunechina.com/shangye/c/2023-01/20/content_426401.htm
This site is only for collection, and the copyright belongs to the original author.