A culture spike for employee wellness-focused organizations in pandemic will re-haul the digital transformation approach
Companies that focused on supply chain adjustments; remote work & collaboration; risk modelling & predictive analysis; real time decision-making, and employee safety monitoring, have been able to weather the pandemic disruption and even take advantage of digital transformation to create new competitive advantage. A cross-industry study by the Economist Intelligence Unit (EIU), of 800 senior business executives and senior-level government employees, spanning eight sectors and 15 economies across the Americas, Europe, and Asia-Pacific, found that these five factors were key in shaping organizational outcomes during the pandemic.
One of the most interesting aspects which is coming out from different surveys during the pandemic is the prioritization of employee wellness, health, and safety above everything else. Employees too have responded positively to this approach which is being reflected in the cementing of organizational culture.
The Culture Spike
To understand what was driving this positive spike in culture ratings in the COVID-19 era, MIT Sloan Management Review analysed how employees discussed more than 200 topics in company reviews during the 12 months before the coronavirus pandemic. The institute’s natural language processing platform identified which topics employees mentioned in the free text of their Glassdoor reviews and whether they talked about them positively or negatively. We then compared how often and how favourably those topics were discussed pre-COVID, with results from reviews written during the pandemic.
For most topics, there was little difference in sentiment before and during the coronavirus pandemic. But one important theme that does stand out in the months of the pandemic is the quality of communication by leaders. Employees of Culture 500 companies gave their corporate leaders much higher marks in terms of honest communication and transparency during the first six months of the coronavirus pandemic compared with the preceding year.
Digital Collaboration in Employee Engagement
Organizations that provided digital collaboration tools also scored high on employee engagement and culture. The EIU survey found that organizations that were digitally prepared had an advantage in navigating the upheavals and challenges presented by the pandemic. They already had the tools and platforms to shift to remote work, recalibrate supply chains for changing demands and disruptions, and transact with customers in new ways. As the pandemic began spreading around the world, the digital infrastructure they put in place allowed them to not only remain competitive from a business perspective, but also to respond to societal disruption in a nimbler way.
The robust pandemic response enabled by strong digital capabilities upended entire industries in ways that will almost certainly persist once the pandemic abates. Reflecting this, most respondents agree that the pandemic has accentuated the competitive edge of digital first firms. In the race to keep up with their digital-first peers, the majority also say the pandemic has turbo-charged their own digital journeys, with 72% reporting an acceleration of their industry’s pace of transformation.
Tech Investments Soar
The scale of this acceleration has been staggering: according to market intelligence firm IDC, global investments in digital technologies and services grew by 10% in 2020 to $1.3trn while a survey by global consultant KPMG revealed that companies devoted an additional $15bn a week to IT in the first three months of the crisis. Survey respondents cited the following innovations as most prominent in their transformation efforts: cloud computing, tools for remote work, artificial intelligence and machine learning, and Internet of Things (IoT) technologies.
While past technology adoption conferred resilience on companies across a range of metrics, the pandemic itself has substantially shifted priorities, our survey reveals. Operational efficiency and productivity were the dominant factors driving digital transformation in the last 12 months, as selected by 57% of respondents in the EIU report.
Employee Engagement Top Priority
This was followed by the need to keep up with digitization trends within the organization’s industry or society at large. However, the pandemic has elevated employee engagement from a nice-to-have into an essential priority, with every industry selecting it as the top area seeing an increase in technology use. As employees around the world shifted to remote-working arrangements, firms were forced to maintain team dynamics and positive human relationships—remotely—while also helping employees stay productive and grow in their careers. Engaged employees are motivated and invested in their work through intrinsic commitment, interest, vigour, dedication, and absorption rather than simply responding to instructions or duties.
According to the EIU survey, despite the impressive flexibility shown by the workforce in facing extraordinary pressures, companies see both benefits and drawbacks to the shift to distributed work. The largest share (40%) consider improved employee engagement and experience to be the most prominent business benefit from distributed work, followed by the installation of a “digital-first” mindset. Yet respondents also select worker isolation and loneliness as the top work-related drawback of the pandemic, garnering 34% support. This suggests that the personal toll is top-of-mind for organizations even though remote work has been the only way forward for many.
Companies have come to realise that their own digital capabilities can play a role in enabling wider societal transition and resilience, from fintech companies and e-commerce platforms allowing merchants to shift to digital payments, to logistics and manufacturing enterprises producing and disseminating healthcare equipment, to hotels supporting everything from traveller quarantines to housing the homeless. Reflecting these shifts, roughly three-quarters (76%) of survey respondents to the EIU survey believe the pandemic has placed fresh responsibility on companies to play a constructive role in wider society. The vast majority of respondents (75%) believe that digital transformation now needs to pivot from enabling business success to supporting broader societal improvement.