MAKING THE CASE FOR A GREAT RE-NEGOTIATION

We are in the middle of one of the most volatile and complex business environments I’ve ever seen. Since March 2020, organizations have been forced to navigate a pandemic, new work tools and collaborative technologies, supply chain issues, shifting public safety measures… and now, companies are facing the “Great Resignation.”The Bureau of Labor Statistics reported that 4.3 million people quit their jobs in August, a record-breaking statistic. According to McKinsey, up to 40% of employees are stating that they are at least “somewhat likely” to leave their jobs in the next 3-6 months. And resignation rates have increased more than 20% for workers between 30 and 45 years old – valuable employees who are in some of the most productive years of their career.We’re hearing that the Great Resignation is being driven by employees who are burnt out, don’t feel invested in, and don’t see future opportunities in their roles. The past year has pressured employees to be endlessly resilient while, in some cases, not being given the support or tools to thrive in our VUCA environment. This is an unsustainable pattern, especially for mid-career employees who have complex responsibilities outside of the workplace.

COVID-19 as the Great Accelerator

Some of these issues have been lurking under the surface for a long time – like the demand for flexible work, which employees have long supported but was slow to be adopted before the pandemic. COVID-19 was the great accelerator for these issues, forcing employers and employees to grapple with their relationship. Now we’re seeing that the Great Resignation is a result of this acceleration.

It’s time to start thinking about a Great Re-Negotiation.

It is clear – the fragile relationship between employees and employers must be renegotiated. Now is the time for leaders to be proactive about retaining their talent, and show the world that they are willing to invest in what it takes to build a strong, people-centered culture.Renegotiation isn’t just about employee satisfaction, fulfillment, and performance – although those things are extremely important. It’s also about giving your business the best chance at success. Organizations achieve their potential when the people in them all share the same mission, work toward the same goals, and operate under the same set of values. Take this time to examine how your culture supports your mission and values; including employee quality of life, investment in skill development, your pay/reward structure, and overall talent management strategy. This is an opportunity to focus on people in the same way that companies have focused on growth, cost-cutting, and right-sizing. If your people strategy has been neglected, finessing quarter-to-quarter profits will have diminishing returns.

Setting the table.

Negotiation is discussion, cooperation, and compromise. There are two parts to a successful negotiation: inviting the right people, or “voices” to the table, and setting the agenda for a positive outcome.

People

Building a strong, people-centered culture will have a positive impact on everyone in the organization. When it comes to the Great Re-Negotiation, you need to make a business decision about who needs to come to the table with the most urgency. For many organizations, that will be the group currently resigning at record rates: 30-34 year olds, or, mid-career employees who have probably been in their roles for a few years.Why is it so important to have them at the table? This group has high institutional knowledge and extensive networks, and have gained valuable skills. This makes them very expensive to replace… and it’s a huge blow to team morale when too many of them leave at once. Apart from standard performance reviews, it has likely been awhile since anyone has brought them to the negotiating table for a transparent talk about the value they bring to the organization, and what they want out of their careers. Take the time to listen, understand, and address their wants and concerns at the negotiating table, before they choose to take their talents elsewhere.

The Agenda

Both parties will get what they need out of the negotiation if they are clear about what is being discussed; including what success looks like for all involved, wants, challenges, needs, and desired outcome.The goal here is to collaborate toward a positive future state, or a “win/win” outcome – after all, the organization benefits when people choose to invest their time and talents there, in exchange for the investment they receive in their personal growth and career development. Have a conversation with your people about their needs and the value they bring to your organization:

• Where do they want their careers to go, and what skills do they need to get there?
• What do they need in order to perform at their highest level?
• Is there alignment between salary/benefits, market rates, and organizational values and purpose?
• Can you figure out a plan for moving forward, together?

The business environment may feel volatile and uncertain, but that’s a great starting point for conversation and collaboration. The companies that come out of this moment with a stronger, more resilient workforce will be the organizations that show in their actions that they are willing to invest in their people… and that all starts at the negotiating table.Stay tuned for the next part of my series on the Great Re-Negotiation: Revisiting the Employee-Employer Relationship. Creating a culture where great talent thrives is one of the best things you can do for your people and your company. You can build the kind of culture where people want to stay by being an engaged and responsive organization that invests in its people.Read Part 2: Revisiting the Employee-Employer RelationshipRead Part 3: Re-Navigating for the FutureSuccess Labs is a leadership development and management consulting firm in Baton Rouge, Louisiana. For more than 25 years, our expert team of consultants has worked with hundreds of companies to grow leaders, build teams and drive results through great people strategy. Contact us to get proactive about expanding your company’s potential, and stay up-to-date with our latest news and leadership development updates here.