The future of work: Seize the opportunities
As we reach the second anniversary of COVID-19 in the UK, businesses and organisations are still grappling with whether there is a ‘new normal’ for work and if so, how to adjust and optimise for it. The pandemic has reinforced and accelerated pre-existing trends in the nature of work, such as the need for purpose, the desire for greater flexibility and the recognition of both the moral and business case for inclusion and diversity. These trends, coupled with the ever-increasing technology opportunities arising from automation, artificial intelligence, machine learning and the availability of information, raise important questions about the future of work.
This is highly pertinent to the water industry, which received a challenging settlement at PR19, with a series of tough step-change challenges such that after the first year, only four companies received rewards against their Performance Commitments. The industry, therefore, needs to up its game for the remaining period and prepare for a further challenging review in PR24.
How then should the industry respond to the ‘future of work’? The good news is that its fundamental purpose is firmly aligned with many of the emerging trends. It is important to assess these trends and consider not just how to address the challenges, but how to seize the opportunities.
The personalisation of work
The impact of the pandemic means we have taken on a new stance of what ‘work’ means for us. It has nurtured a shift in how work is perceived, prioritised and experienced, resulting in new behaviours and demands: ‘work-life balance’ has evolved into ‘work-life blend’. This is aligned to broader cultural developments and greater societal awareness, arising from movements such as Black Lives Matter (BLM) and #MeToo and from increasing cognisance of the impact of climate change. These societal value shifts are especially pertinent to an industry with over 70% white male employees and lacking in ethnic, racial and gender diversity. Change is long overdue.
The personal demands arising from this new environment are often unique, based on individual employee needs and are typically dependant on where they are in their life and career. This is creating a trend for the ‘personalisation of work’ and plays a large part in another trend - ‘the great resignation’. This is a phenomenon first noted in the US, where some states saw very high voluntary resignations in the second wave of COVID-19. In Germany, resignation rates rose to 6.1% and in the UK to 4.7% in mid-2021 against a typical average of c. 2.1%. This exodus spans all ages, creating a huge knowledge loss risk for employers. More than half of Gen-Z reported planning to seek a new job within the next year – the very cadre that companies need to attract. This withdrawal from the workforce sharpens ‘the war for talent’, and many industries need to re-think how best to attract, retain and develop talent.
Responding to this changing environment presents a huge opportunity for employers to get more out of their workforce, bettering engagement, increasing productivity and improving wellbeing, retention and collaboration. There are four key areas where companies need to focus.
Pre-pandemic, there was an increasing recognition across leading companies of the importance of purpose. Clarity on why the organisation exists and what it wants to achieve began to supersede the vision and mission statements of old. The pandemic has accentuated this trend. A study of 20,000 employees showed that when leaders are clear about purpose, employees are twice as likely to stay in the organisation. This is a huge opportunity for water companies, where the fundamental purpose aligns extremely strongly with many heightened values: creating a sense of community; seeking to provide a service in the public’s interest; environmental sustainability of the UK’s water; impact on climate change and health.
A new leadership agenda
Increased autonomy has created a need for a new type of leadership, one where employees are more trusted, with individual, personalised preferences respected and catered for.
Working with organisations in highly regulated and technical environments, we have found that leaders must be much more empowering. Where leaders no longer constantly interact with team members, they’re unable to provide moment by moment oversight, instead they must manage by outcomes – what they need the team to achieve, rather than the specific activities being carried out. In addition, awareness and sensitivity to mental health and well-being is essential: zero harm is no longer just about physical wellbeing but also mental health. Leaders also need to be more skilled on inclusivity and supporting diversity.
Research recently carried out by PA interviewed leaders across the UK, US and northern Europe who identified that a key characteristic for leaders is empathy. The most successful leaders are those who demonstrate understanding and awareness of their people’s needs.
Hybrid: ‘haves’ and ‘have nots’
Whilst ‘hybrid-working’ is arguably the business buzzword of the last two years, it’s not advantageous for all. Where many in the workforce are field based, such as in water companies, hybrid can be a near-meaningless concept with a high risk of resentment if office-based workers benefit from more flexibility, while field workers have limited freedom and carry greater risks. Leadership must address this to avoid a cultural divide. One water company, for example, equalised isolation periods for all staff post-holidays, even though office workers could practically work from home. Another company has increased flexibility for staff based at plants by creating shift patterns around school times, to enable working parents to collect children. Companies need an overall strategy in place with input from the workforce itself.
This issue also relates to the increase in outsourcing and the use of partner organisations. The use of technology has increased globalisation opportunities and created potential to harness an ever-wider global talent network. However, for water companies, who have traditionally employed local people to deliver a local service, this creates a predicament. This community is and has been a two-way dependency for decades, creating a culture and values of its own. So, does the increase of globalised talent present a risk to that culture? Does a local company for local people lose its identity if it’s served by non-locals? Do you present the risk of diversity loss by keeping it purely local? The water company needs to address how its purpose, values and employee value proposition flow down to its partners.
Technology and data enablement can be a key enabler in addressing these issues. Microsoft Teams for example, went from 32 million daily active users to 145 million by April 2021. This technology update does not just apply to office workers but creates opportunities for engaging the field/plant workforce in new ways too. With technology being able to bridge the gap between disparate workforces, there is opportunity for fairer engagement, a louder voice, greater recognition and a level playing field for different workforce types and personae.
Work is evolving at the fastest rate for a generation. Our current response to the pandemic has been reactive, but we need to now be proactive. This should be a key focus for water companies. The challenges of PR19 and PR24 with the need to deliver ever-greater performance, embrace a broader remit and adopt new technologies, means a fully engaged hybrid workforce is essential. Water companies are well placed to seize the opportunities of this, and we propose a five-point leadership imperative for water companies to transform its workforce:
- Understand your employees and their personal individual needs so that you can support and harness their future of work.
- Reset the employee value proposition to embrace organisational purpose and new ways of working.
- Develop your leadership capability to be more empowering, inclusive and empathetic.
- Reimagine the employee experience for diverse persona groups in your workforce, harnessing the voice of the employee
- Design and adopt different models of working that provide hybrid options for some and additional flexibilities for non-office-based colleagues.
If we get this right, water companies will be able to establish an essential foundation for delivering the AMP, providing resilience and preparing for PR24, with a vibrant, energised and enthusiastic set of employees aligned with its purpose.