The pandemic’s impact on employees continues to be top of mind for U.S. CEOs, who identified pandemic-related fatigue as being the most pressing concern for their organizations today. Seventy-six percent of U.S. CEOs believe they need to address burnout from accelerated digital transformation over the past two years before continuing their transformation journey.
Expanding the concept of the employee value proposition has been one of the most important outcomes of the pandemic. During the pandemic, that value proposition for employees evolved into the total experience that companies offer—financially, mentally, socially and physically.
Today, on top of persistent pandemic burnout, companies are facing a challenging labor market with high inflation, low unemployment and acute shortages of certain skills. With recession fears causing layoffs and hiring freezes—and the need to position the workforce for future growth—companies are trying to balance their needs with the economic reality and employee expectations.
“While the most dramatic evolution in the employee value proposition took place during the pandemic, the evolving employee expectations are here to stay,” says Sandy Torchia, Vice Chair of Talent and Culture at KPMG, who calls the current labor market competitive. “Companies need to present employees with a value proposition that aligns with what an individual candidate finds the most valuable for their work life.”
Fulfilling employees’ expectations starts with listening. “What has become clear these past few years is the importance of actively listening to your employees, taking action and having an open dialogue,” says Workday’s Fernandez. “Without understanding the diverse and ever-changing needs of your people … you cannot expect to attract, engage or retain talent in this climate.”
Just as it serves its clients with personalization at scale, Stitch Fix applies the same approach to employee experiences. “At Stitch Fix, we know there is no one size-fits-all approach, whether for clothing choice or working style,” says Spaulding. “Our personalized work model allows us to hire a diverse workforce centered in equity. We can hire a range of intersectionalities, such as caregivers for children or family members, more introverted team members, and people living outside of our original San Francisco HQ.”
Companies need to present employees with a value proposition that aligns with what an individual candidate finds the most valuable for their work life.
Vice Chair of Talent and Culture
Bank of America stresses a long-term approach. “We want employees to develop a long, fulfilling career with our company, so we focus on providing support from their hire date through retirement,” says Moynihan.
“Our ongoing focus on employee health and safety was critical during the health crisis, and that continues today. During the pandemic, we continued and even expanded many of our benefits and programs to support employees, keeping medical premiums flat for employees earning less than $50K for the 11th year in a row and raising our U.S. minimum hourly wage to $22 in June as a next step in our plans to increase to $25 by 2025,” says Moynihan.
Pay remains important, especially in the current inflationary environment. The confluence of economic and talent management issues will exert the biggest impact on organizations over the next three years, with 73% concerned about their ability to retain talent with pressures of inflation and rising cost of living. Talent issues are high on U.S. CEOs’ agenda, with attracting and retaining talent being the third biggest operational priority (21%).
In this challenging environment, companies are making sure they have the right skills to grow their organizations.
“Companies need to consider what type of workforce they need to achieve their growth objectives,” says Torchia. “They need to consider the right combination of recruiting and upskilling to be able to face the needs of tomorrow.”
Outside of financial benefits, Torchia points to flexibility as an important trait that employees are looking for. Such flexibility may be best delivered via the hybrid work model, which has been implemented by many companies during the pandemic and will continue to be the most popular way of working (45%) over the next three years.
The specifics of the hybrid model are not yet set in stone, as companies need to continue to evaluate how it’s working—for employees and the business. “Technology will be critical in understanding what’s working and where we may need to pivot,” says Fernandez.
We've put a lot of thought into the work environment, creating the best possible experience for the employees that align with the best results for the company.
U.S. CEOs believe continued flexibility will benefit employee well-being and help their organizations attract and retain talent. “We've put a lot of thought into the work environment, creating the best possible experience for the employees that aligns with the best results for the company,” says Dallas. Wind River’s flexible approach includes anchor days, when employees can meet with others in the office, which has been redesigned specifically for collaboration.
At KPMG, Torchia is focused on combining flexibility with connectivity in a way that helps employees collaborate, develop and relieve stress at the same time. During the pandemic, KPMG started camera free Fridays, when virtual meetings are audio only, and introduced the concept of meeting-free “heads-down” time, so that employees can focus on tasks that are best performed without interruption. Additionally, the default meeting time of a half hour has been switched to 25 minutes, and from an hour to 50 minutes, to give employees a breather between meetings.
While the work-life balance modifications help with the employee experience, companies must also appeal to something deeper. Company purpose–what a company stands for and how it treats its employees and the community—must align with employees’ values. ESG efforts that create a sense of purpose and trust remain important for employees, and the results are a key metric of how organizations inject meaning and value into working.
For Bill McDermott, CEO of ServiceNow, ensuring that corporate purpose is both an effective and symbiotic method for business growth means making sure employees’ personal values align with those of the company. “You must focus on recruiting properly to make sure there is a great match with the individual values of a person coming into your culture. Having that match also impacts diversity, equity and inclusion.”
Seventy-six percent of U.S. CEOs believe that progress on diversity and inclusion has moved too slowly in the business world, and 51% believe that corporate purpose will be important for strengthening employee engagement and the employee value proposition over the next three years. “Focus on diversity, equity and inclusion is our business imperative,” says Torchia. “We are building an environment where people are able to show up being their authentic selves.”
CEOs understand that their employees—or potential employees—are looking at organizations’ reputations as corporate citizens when making their decisions about where to work. Dallas also notes that the company’s investment in a “social contract” positively impacts its local communities. The California-based Wind River has partnered with organizations like Oakland Promise and Blacks in Technology to empower underrepresented groups. “We realize that people who are joining our company are not doing it just for our technology vision and workplace culture, but also for how we contribute to the community,” says Dallas.
“We firmly believe our role is to drive both profits and progress,” Moynihan says. “We need to align capitalism to produce this progress because, as a practical matter, the only way progress is going to be made is through the involvement of the private sector.