Recessions have consequences. Obviously they force people and companies to focus on money, finance and the economy. Lynda Gratton, a thought leader on people in organizations and Professor of Management Practice at the University of London reminds us that each recession also impacts the organization's workforce. In her December 10 column in the Finacial Times she summarizes the skill impacts of the last two recessions and suggests the effect of this recession on work and job skills. It is important to recognize that though the financial implications of a recession are dire, in the long term "the effect on work and working habits can positive."
The 1981-82 recession put an end to the notion of a "job for life" and transferred the responsibility for our work career from the organization to the individual person. Indeed, the employer/employee relationship could be described as moving from "parent-child" to "adult-adult." The culmination of that change is becoming more and more obvious in the current and drastic restructuring of the American auto industry. Sadly, workers are quite unprepared for their career losses, and organizations and government have done little to prepare them for those changes. That may be harsh, but in any instance few workers have little insight or understanding of how to successfully change their careers.
Although Gratton did not allude to it, the recession of 1981-82 also shifted organizational talent requirements from managing--with all its mechanical control focus--to leading--a competency requiring more people skills than had ever been emphasized in the past.
The recession of 1990-91 confirmed those changes and added the dimension of globalization--a dimension that has both positive and negative consequences. Low-cost, out-sourced products and services are a blessing to Wal-Mart consumers, but disaster for many manufacturing employees. The effect of that recession was the globalization of talent--an issue that is felt profoundly in some sectors. Not only manufacturing, but especially information technology and research now are global talent markets. Microsoft is not the only firm that has located research and development in India, China, Latin America, the Middle East and Eastern Europe. Medical and scientific research is carried out all over the world. Inevitably, American workers compete with the workers from all over the world. That, too, according to Friedman's Flat World, is not going to change.
The recession of 1990-91 also accelerated the need for leadership competencies. Although an entry-level manager used to be rewarded for his/her ability to control employees, employees now have more authority--and power--requiring enhanced leadership sklls from their their bosses.
So how is the current recession liable to impact work and work habits over the next decade? Gratton suggests that leadership and decision-making will become more and more decentralized. If companies are to avoid organizational failure such as that experienced by Lehman Brothers, they will decentralize not only leadership, but also decisionmaking. Unilateral decision-making by command-and-control types such as those in the finance and auto industries will be scrutinized far more closely in the future. In short, if the taxpayer is going to give business a lifeline--such as is currently happening--senior people might as well get used to the scrutiny. It will be taking place throughout the nation, the result of employees who are deeply concerned about their company, because their own and their children's future are tied its balance sheet.
What this also means is that workers at all levels are going to be responsible for decisions at a pace and depth not seen in the last one-hundred years of business. My take on decision-making is that business leaders are going to have to make decisions, usually with incomplete information and too often in less time than is needed. The old-fashioned ways of depending on intuition, common sense, and narrow specialized expertise are simply no longer sufficient. My experience over the past five years tells me that Gratton is exactly correct in her focus on decision-making--and that this recession is bringing it all to the fore.
Decision-making can no longer be taken for granted by leaders--and furthermore, decision-making is not nearly as easy as many think. As a consultant, I've had plenty of experiences with managers who when faced with a decision simply pull the trigger based on past experiences. And when I ask about the data required and used for a given decision, they look at me like I'm from outer space. People really need advice and training in how to improve their chances of getting a decision right, where they are liable to make a mistake, and who they need to get involved in a decision. There are proven skills and strategies for successful decision-making, but thus far, they've not been widely disseminated.
What do you think? Am I too narrowly focused, or are the times ripe for this kind of change?
