Evan Siddall is the CEO of Alberta Investment Management Corporation (AIMCo), one of Canada’s largest institutional investment managers, with over $168 billion in assets in 2021.
A historic turning point has begun. After a decades-long global economic expansion that has seen the value of labor decline relative to the return on investment, the balance of power is shifting between capital and labor. In these last days of the pandemic, it may even have now swung in favor of employees.
Today, employers face a loyalty crisis. Pent-up frustration, simmering turnover, and the growing work-from-home economy turned into a “big quit.” According to a recent Bank of Canada survey, 19% of Canadians expect to leave their current jobs in the next 12 months – the highest level since the survey began in 2014. jostling” and the increase in free time reminded our colleagues that they can make different choices. People’s emotional connection to work has faded.
This has been a long time coming, with several factors blurring the implicit contract between capital and labor. In recent years, workers have seen real cuts in the minimum wage, while productivity has outstripped wage growth.
Outsourcing and the increased use of temp firms have further eroded the employer-employee bond, commoditizing people and reinforcing a transactional labor economy.
Let’s face it: employees are disloyal to employers because they have been treated unfairly.
The pandemic has shown us that companies have neglected employees and loyalty at their peril.
Wage inflation is accelerating as employers scramble to retain workers and preserve office space, while employees reject ‘presenteeism’ and insist on greater flexibility. Leaders are now worried about the “new normal”, “the future of work”, “workplace 2.0” and “hybrid workplaces”. However, the solution is much more complicated than insisting that employees spend two or three days a week at their desks.
As our economy has matured, jobs require more intellect and nuance. Workers are more skilled and more capable. They don’t need to be told where and when to do their job. They resist micromanagement and are able to work with little supervision. We must look beyond the outdated models of hierarchical control adapted from military command to a manufacturing economy.
People want goal-oriented work. Dan Pink identified three factors – purpose, autonomy and mastery – as the main sources of employees’ extra discretionary effort in his 2009 book, Driving: The Surprising Truth About What Motivates Us. It’s the combination of these three drivers that increases productivity, instills a commitment to customer service and creates fertile ground for innovation. And they find the most value and satisfaction in their work when we, as leaders, trust them to do it well.
At AIMCo, we are changing the manager-employee relationship and supporting a “choice first” work environment, focused solely on results.
Four key elements reinforce a culture of trust and respect:
1. Let employees choose: The work is personal. It is a huge mistake to dictate working conditions to employees. Work teams should deliberately determine what type of collaborative work is best done in person. Work that supports learning/learning, team alignment, and innovation/brainstorming are often, but not always, examples. We asked our teams to define how they choose to collaborate. The decisions are ultimately theirs.
2. Measure what matters: Performance management should never have been line-of-sight management. Use a results-based goal-setting methodology to ensure leaders and employees are all focused on the same measurable goals. Give feedback often, much more frequently than monthly checks.
3. Retrain Staff Leaders: The potential weak links in this new system are the bad habits of managers. A “results only” mindset forces them to unlearn old ways. Moreover, moving blindly towards new workplace conventions is unwise without a new, cohesive support system. This may mean seeking help outside your organization to develop leaders.
4. Flatten the organization: In keeping with greater employee autonomy, there is a lighter managerial hand. We have also adapted our organizational structure by increasing the span of control of leader people (number of direct reports). This gave us the opportunity to “enhance” our cadre of executives and reduce executive contact.
Employees just want a little respect. Stephen Covey and Richard Branson have both been quoted as saying, “Treat your employees the way you want them to treat your customers.
Employers need to trust their employees to make decisions that will allow them to perform at their best. Rather than rushing haphazardly to block the exits, we intend to light the way to the entrance, allowing us to attract and retain the best colleagues, who will help us continue to deliver results. superior to our clients and their beneficiaries – the people of Alberta.
It’s actually as simple as that.
Your time is valuable. Receive the Top Business Headlines newsletter in your inbox morning or evening. register today.