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Looming economic uncertainty means the threat of budgets being tightened is as real as ever. What’s one of the first places organizations tend to trim budget?
Often, it’s training and development.
But when people and teams are asked to do more with less, that’s probably when they need development training the most.
Economic challenges place bigger demands on everyone, which often results in stressed employees. Conflict is likely to increase, too. And let’s not forget the complexities of the post-pandemic work environment, which we’re still in the early stages of understanding.
Here’s why people development should be prioritized, not neglected, in times of uncertainty.
The new challenges for organizations
McKinsey (2021) also believes skills are critical for uncertain times. “Developing existing talent is among the most crucial investments organizations should make amidst talent scarcity and the high cost of external hires. A new employer-employee contract on reskilling is needed; employers should actively invest in upskilling to accommodate shifting needs, and constant learning should be a core expectation of employees.”
Their report goes on to say, “Not only can this increase worker productivity by 6–12 percent, but it also increases employee loyalty and satisfaction, reducing their likelihood of leaving.”
They draw on their own research to show that those who committed to through-cycle investment during economic crises delivered higher returns to shareholders than those who didn’t.
If the ‘boundaryless workplace’ (Deloitte) and through-cycle investment (McKinsey) make the case for skills-focused development in uncertain times, which skills should organizations focus on?
Change has changed
In his Psychology of Change webinar, John Hackston, Head of Thought Leadership at The Myers-Briggs Company, explores the new definition of change.
He notes that although change has always been with us, the nature of change is different now—and it has a greater impact.
“Change is coming at us faster than it did before and that means we have to adapt to faster speeds than we’ve been used to in the past” says Hackston in the webinar. “There’s a lot of literature out there that talks about the fact that originally, a lot of organizations were built and managed and designed to bring about stability but often that no longer works. We can’t just make small, incremental changes and expect to keep up.”
People and organizations are now living and working with:
- Increasing amounts of change.
- Increasing speed of change.
- Increasing uncertainty.
This is being described as disruptive change.
Professor John Kotter, a leadership and change specialist, says, “We are in ‘disruptive change’, a more rapid and complex changing environment. As a result, there is a growing gap between the amount, rate and complexity of change, and our human capacity to keep up.”
For Hackston, it’s the ‘human capacity’ that’s the key consideration. Change—specifically, disruptive change, like we’re encountering now—has a psychological impact on people.
Developing essential skills for uncertain times
Bringing the above points together makes a simultaneous case for leaders, managers, and HR professionals to:
- Focus on skills and strengths to increase agility.
- Focus on well-being to help people cope with disruptive change.
The good news is that self-awareness training can be the foundation for both.
1: Make a strengths and skills inventory
To be able to deploy talent effectively across the organization, it helps to first know what talent’s already there.
But instead of focusing solely on skills that most obviously relate to jobs or roles, try to get behind all that. Remember, people’s core strengths aren’t always immediately visible. They might not even be being used in their current role.
The question we’re really asking is, what are your people’s best qualities? What is it about them that helps them perform well?
A self-awareness tool like the MBTI® assessment explores all this. It helps people understand their core qualities, strengths, and motivators, which is invaluable data for organizations that want to be flexible, adaptable, and agile.
For leaders and managers, it brings people’s potential into the equation.
“Organizations must consider investing in their existing workforce’s skills as well as attracting and retaining the right new talent,” says McKinsey in The future of the workforce: Investing in talent to prepare for uncertainty. “Developing existing talent is among the most crucial investments organizations should make amidst talent scarcity and the high cost of external hires.”
In our capacity as personality professionals, we’re advocating for essential (‘soft’) skills—that is, non-technical skills—being a vital component in any skills-oriented investment.
2: Close the well-being gap
Hackston considers four factors that have an impact on the human capacity for change. They are:
- Uncertainty
- Burnout
- Well-being challenges
- Change fatigue
Looking at well-being, there’s evidence of a gap. Gallup found that less than one in four US employees feel strongly that their organization cares about their well-being.
And yet, well-being has a significant impact on key performance indicators. This means that low well-being contributes to fatigue, stress, demotivation, reduced morale, disengagement, absenteeism, and quiet quitting.
For this reason, developing employee well-being strategies is one of Hackston’s four recommendations above for dealing with disruptive change. Such well-being strategies include:
- Raising awareness of what constitutes well-being.
- Normalizing mental health discussions.
- Offering flexibility at work (location, times).
- Providing self-awareness training (to learn about stressors, for example).
- Developing human-centred leaders.
The last of these points is shown to have disproportionately positive results regarding employee well-being.
How else can essential skills help organizations deal with change and uncertainty?
Here are three more reasons why understanding personality type makes sense in uncertain times.
- It helps people work better with others. If organizational flexibility increases, people will work across functions and departments. Knowing how to work with different communication styles, decision-making styles, and approaches to conflict, which are all bound up in personality type, becomes a highly desirable skill.
- It increases talent retention. When people get to use their strengths, they feel more fulfilled. This boosts well-being and increases the likelihood that employees stay with their employers. But the first step is to identify those strengths.
- It might take some pressure off managers. Leaders and managers can’t be expected to have all the answers or ‘always know best’, especially in this era of disruptive change. Understanding personality types is a chance to learn people’s motivations, trust in their strengths, and support them better. This is the way forward for leaders.
The economy is cyclical, so there’s no way around downturns and uncertainty. But there are ways you can utilize the strengths of your people beyond their current role and job description. Doing this helps bolster your organization by reaching employees’ potential and creating agile organizations that can respond to change as quickly as it’s happening.