Meet the psychological needs of your people—all your people
Too many employers pay too little heed to the needs of the lower earners in their company. Here’s why—and how—they should shift gears.
The late Brazilian car-racing champion Ayrton Senna once said, “You cannot overtake 15 cars in sunny weather, but you can when it’s raining.” Well, there’s been no shortage of downpours in recent years. We’re living in a world where new shocks—the war in Ukraine, the return of inflation—have been layered onto earlier shocks—a deadly global pandemic, supply chain disruptions—that in turn were layered onto, and dramatically accelerated, long-standing trends such as digitization and sustainability.
In almost all our recent conversations, CEOs, board members, and other business leaders share with us a common sentiment: this combination of shocks has created perhaps the most challenging environment management teams have ever faced—and one that likely won’t change anytime soon. We have entered an age of volatility.
Such stormy times test leaders’ mettle. Today, some are pulling off the racetrack and looking for shelter. Others, however, are changing to wet-weather racing tires and stepping on the gas.
Indeed, we see two types of business leader emerging. The first type adopts a cautious and defensive posture in dealing with the volatility and uncertainty. These leaders are hunkering down and concentrating on the threats here and now. Scenario planning, resilience preparation, balance sheet management, near-term efficiency drives, and careful inflation monitoring are core areas of their focus. These leaders are in a strategic “wait and watch” mode as conditions unfold. In our experience, the majority of senior executives fall into this category.
But we see a second type of leader as well—one who is taking all the right defensive actions while also leaning into the volatility, using it as a catalyst to galvanize action around new opportunities. The current disruption has invigorated these leaders’ mindset of moving forward boldly, and they are rejuvenating elements of their strategy that may have been dormant. These leaders are playing both offense and defense.
That’s a sound approach. Our research on corporate resilience shows that defense-only postures tend to lead to median company performance, while offense-only stances deliver a mix of occasional wins plus some catastrophic failures. The best leaders and companies are ambidextrous: prudent about managing the downside while aggressively pursuing the upside. These leaders are thinking about the next decade, not the next month.