Norman Marks on Governance, Risk Management, and Internal Audit

One of the reasons for spiraling costs and (in some cases) degraded service is insufficient staffing.

For example, economies have been hurt by a shortage of truck drivers, people to stack the shelves in the market, and more.

This week, I flew home from London’s Heathrow airport. United had warned us of long lines at security, advising us to arrive at the airport four or five hours before our flight. Some took it further, getting in line to check in six hours early.

The lines were very long but we had listened and were patient.

United employees told us that it was because of staff shortages – and that the lines were even longer the day before!

We should be concerned for our own organizations – not only because we are being constrained now, but because there’s a continuing risk of losing more employees.

Executives are not exempt from this situation.

A recent study by Deloitte and Workplace Intelligence, The C-Suite’s role in well-being shared some sobering findings:

There’s no question that well-being is at the top of the C-suite agenda right now. While the pandemic brought worker safety into the spotlight, there’s also been an increased focus on the overall poor state of workforce well-being and the role that organizations play in determining quality of life for employees and their families.

In fact, most companies now recognize the need to invest more in the holistic health of their employees, because it’s clear that workers are fed up—with outdated norms like the nine-to-five schedule, the expectation that they should be “always on,” substandard wages and benefits, and the idea that they should be willing to sacrifice their health and their personal lives for their job.

C-suite executives themselves are not immune. Although far less attention has been paid to well-being among the C-suite—how they’re faring, the increased demands placed upon them, and whether these factors are influencing their desire to stay in their leadership roles—some recent research points to increasing quit rates among executives.

And as we’ve seen with the Great Resignation, many people are no longer willing to tolerate jobs that leave them unhappy and in a constant state of stress and fatigue. Indeed, there’s been a notable power shift over the past few years, with workers demanding more from their employers than ever before and companies scrambling to adapt their employee value proposition to avoid a looming talent shortage.

…despite struggling with well-being themselves, it’s clear that the C-suite doesn’t appreciate the extent to which their employees feel the same way. In contrast with what employees reported, more than eight out of 10 global executives believe their people are thriving in all aspects of their well-being.

Many employees don’t feel that their executives have been supportive during the pandemic—but the C-suite sees things much differently. For example, only 47% of workers believe their executives understand how difficult the pandemic has been for them, yet 90% of the C-suite say they do recognize how challenging it’s been. Similarly, while only 53% of employees feel that their company’s executives have been making the best decisions for their well-being during the pandemic, 88% of the C-suite believe their decision-making has been exemplary.

Perhaps most alarmingly, we discovered that only 56% of employees think that their company’s executives care about their well-being. However, the C-suite sees things in a much different light: Ninety-one percent believe that employees feel their leaders care about them. It’s a notable gap, one that the C-suite must work to address.

The authors say:

While 57% of employees are seriously considering quitting for a more supportive job, nearly seven out of 10 executives are thinking about taking this leap.

Can we afford to lose more employees, including leaders of the organization?

The paper has advice that should be considered, but there is more.

For example, I recently read a report that said that employees are considering leaving because they don’t have the tools (read “toys”) they think they need.

There is more that practitioners can do to help their organization.

We can help answer three questions:

• What is our current state? How has our ability to move the organization forward been affected, including our ability to perform the necessary internal controls, manage risk, and seize opportunities?
• How are our people doing? How many are considering leaving? How serious is the risk?
• Is management doing enough?

Practitioners can structure projects (perhaps in coordination with Human Resources) to address these questions. I suggest building something more continuous rather than one-off. I would also avoid surveys as you never know how open people are in responding. Face-to-face discussions are best.

But we can open our eyes and ears every day.

When we talk to people, ask:

• What’s it like working in your department?
• Is it a good place to work? Would you recommend a friend apply?
• How are you affected by staffing shortages? I know many are working longer hours.
• Have you lost key employees recently? How is everybody coping?
• Have staffing shortages affected customer relationships?
• What should management do?
• And more

Are there more significant sources of risk today? Maybe not.

Practitioners should seriously think about how they can help.

I welcome your thoughts.

(See also The Great Resignation Risk.)