Cost of Living Crisis: What’s a CEO to do?

Cost of Living Crisis: What’s a CEO to do?

The Cost of Living Crisis has become a workplace issue and employees expect to be supported

Cost of Living Crisis: What’s a CEO to do?

The Cost of Living Crisis has become a workplace issue and employees expect to be supported

Many businesses are now under extreme financial pressure, as the price of energy bills, goods and services continues to rocket. But that’s not all CEOs are worrying about, in addition most decent bosses will also be deeply concerned about how their people will survive the coming months.

CEOs are grappling with current cost of living crisis and how the aftershocks of the pandemic effect their operations. But you can’t separate the prosperity of a business from the prosperity of the workforce.

There is now a growing, immediate need to make sure people have food, warmth and shelter.

How shocking is it to read that several NHS Trusts have already set up food banks or launched food voucher schemes to support their staff?

As well as being an all-round total sh*tshow for running a business and a household, the UK cost of living crisis inevitably blurs the boundaries between home and work ‘problems’. The burden of everything being too expensive, weighing heavily on personal lives, work lives and mental health.

Leaders now recognise that the cost of living is affecting people at work

How will work life be impacted by the cost of living crisis?

There’s no arguing that life feels uncertain, and the economic outlook is unclear. We don’t know how work will be affected by the cost of living crisis, and many business leaders are still trying to work out what to do for their customers and team members.

If you understand what’s likely to happen in your business, it will help you design the right support for your team…

Shift in balance of home / office working

  • As people choose between the cost of travelling to work vs heating their homes, and keeping money aside for other essentials, we’re likely to see a shift in the balance between the number of home working days and going on to site.
  • Is it more expensive to stay at home and work or travel to site to work?

Key workers will suffer disproportionately

  • The disparity between those who benefit from home/remote working and those who must come into work is likely to widen.
  • At the time of writing, it seems that fuel prices have dropped slightly but they’re unlikely to come back down to the heady days of £1.50 per litre.
  • This disproportionately impacts certain sectors: the emergency services, shops, factories, health worker, refuse collectors, schools … the very people we depended on during the pandemic.

Many working people with modest salaries will be in fuel poverty

  • Although the Energy Price Guarantee has been introduced, the cost of home energy has more than doubled in the past 18 months.
  • The End Fuel Poverty Coalition estimates that the number of households across the UK in *fuel poverty from 1 October 2022 will be 7 million, this could rise to 7.8 million from early 2023.
  • If you have people in minimum pay roles in your business, it’s quite possible that they will be in fuel poverty.

Our pandemic 'heroes' are going to suffer disproportionately vs. everyone else

What can CEOs do right now to support employees through the cost of living crisis?

  • Many companies are now offering one off ‘cost of living’ payments, which come with their own challenges.
  • Bit of a no sh*t Sherlock one this … but prevention is better than cure – make sure you pay people at least a living wage.
  • No, not the National Living Wage but the Actual Living Wage as measured by the Living Wage Foundation.
  • If you’re not sure you can afford a living wage, there may be ways you can make your business more efficient and unleash potential to achieve more, or create headroom for better wages.

If you’ve made more than you thought, share it!

  • If you’ve made greater profits than forecast, consider passing on some of those earnings to your team, as soon as possible.
  • It goes without saying that your people are your greatest asset and should share in the company’s successes.

Don’t pay for employee benefits that nobody uses

  • Stop funding ‘ghost’ benefits and reinvest that money.
  • Whether you’re due to review your employee benefits or not, now is the perfect time to look at the flexible/opt-in benefits that you offer and understand if they’re being used or not.
  • Things like perks websites, opt-in discount schemes, employee health cash plans, all cost money. If they’re not making a difference, get rid and use the money in a different way.

Satisfaction with pay, reward and benefits is constantly changing – you have to keep pace with the market!

“Individuals’ preference and satisfaction levels in relation to reward are dynamic, not fixed. External events, for example a recession, can affect individuals’ confidence, altering their satisfaction with current reward offers.”

— CIPD 2015, Show me the money, the behavioural science of reward

Make sure everyone knows if help is already available

  • If you have an Employee Assistance Programme (EAP) it may well offer 24/7 access to wellbeing, financial and legal advice.
  • This means employees and workers (including board members and volunteers) can go to someone independent if they’re struggling.
  • If you’ve got this benefit shout about it!
  • Make sure everyone* that’s eligible knows about it. (*Some EAP providers have a minimum earning level/working hours in the contract so check first.)

Plan for more people coming ‘in’ rather than working at home

  • Facilities, HR and Operations teams should prepare now for greater workspace usage over the winter.
  • Remember: you should have plans in place to comply with any change in COVID-19 public health measures alongside a greater desire to come into the office (if possible).

Proactively talk to your team about the support available to them

What should CEOs do in the medium term to help employees survive inflation?

Just yesterday, the Office for National Statistics (ONS) announced that the main measure of inflation, the Consumer Prices Index (CPI) was 11.1% in October 2022, up 10.1% in September 2022.

CPI is at an eye-watering figure and it’s not something you can control, so what can you do?

Pay your team fairly

  • Many companies are now offering one-off ‘cost of living’ payments, which come with their own challenges.
  • Bit of a no sh*t Sherlock one this … but prevention is better than cure – make sure you pay people at least a living wage.
  • No, not the National Living Wage but the Actual Living Wage as measured by the Living Wage Foundation.
  • If you’re not sure you can afford a living wage, there may be ways you can make your business more efficient and unleash potential to achieve more, or create headroom for better wages.

Bring in independent advisors to help people

  • Financial wellbeing and education is something most employers don’t know they can provide for their teams.
  • We’ve seen plenty of examples of organisations working with independent advisors and coaches to help their teams manage their money well and deal with any debt issues that might also be crippling their household budgets.

Creative thinking around the affordability of travelling to work

  • Travel allowances have fallen out of fashion, but it might be time to reconsider, perhaps refocusing on public transport rather than vehicle allowances.
  • If you’re not able to offer a travel allowance, you might want to consider an interest-free season ticket loan that colleagues can access via payroll.
  • You’re not actually paying for the season ticket; however, you’re helping your colleagues to avoid a crippling season ticket payment and reduce the cost of coming to work.
  • If lots of people drive, consider a carshare scheme.
  • You could also introduce a cycle to work scheme, which would help support health and wellbeing as well as being a travel solution.

Help people charge their cars for free

  • Add EV charging/parking points to your company properties/car parks.
  • This won’t help everyone but as EVs become more popular, it’s another way to help your team and encourage others to switch away from petrol/diesel.
  • If you have solar panels on your buildings, use the energy to feed the EV charging points FOR FREE for your colleagues and visitors. (If you’re in Wales/South West we can recommend some reliable contractors to do this work for you – get in touch)

How can CEOs insulate their staff against future financial hardships?

In addition to the short and medium-term options we’ve discussed in this article, there are opportunities for leaders to help insulate employees against future financial hardship.

Here’s some ‘slow-burn’ options that are likely to help with the family finances, and increase engagement, loyalty, productivity and performance.

Performance-related pay scheme

  • Consider how you can share profits through a performance-related pay scheme.
  • Maybe even consider how an employee ownership model might work for you?
  • There is no ‘one size fits all’ approach here and in some sectors, this wouldn’t be right, e.g. use of public money, however it’s worth looking at if it’s an option that’s appropriate for you.

Shadow equity schemes

  • If performance-related pay isn’t right for your business, you might want to consider a shadow equity scheme (good for VCs and those looking to retain key talent, grow and sell within 3-5 years).
  • A great way to share the benefits of a business sale with your team.

Long term incentives plans (LTIP) for executives

  • These tend to work better for businesses and executives alike, rewarding long term performance and productivity instead of short-term results.
  • In the context of a cost of living crisis LTIPs incentivise executives to make decisions that retain talent and ensure a good customer experience, meaning executives are less likely to make short-term decisions to save a few quid at the expense of long-term performance.

Don't know where to start when it comes to supporting your team through the Cost of Living Crisis?

We are passionate about finding ways to help bosses do the best they can to look after their people.

Some of what we’ve outlined here is simple, but implementing activity that’s targeted to help those that need it most often gets businesses in a pickle. Primarily because they get bogged down about treating all employees the same.

If you need help to work how to support those that need it in a way that’s fair and legal, then please drop us a line. We’d be happy to talk to you.

Ascenti | Bespoke Leadership Development Programme

BESPOKE LEADERSHIP DEVELOPMENT PROGRAMME

Design and deliver a bespoke Leadership Development Programme for the UK’s leading provider of physiotherapy and mental health services

The Spark Company (Human Resources) Ltd Logo

A great partner for any business

“Andrew at The Spark Company is a great partner for a business to work with. He combines a practical, no nonsense approach with good technical knowledge and quickly builds a rapport with existing teams to hit the ground running.”

Jacinta Magee
Chief Financial Officer

⭐️ ⭐️ ⭐️ ⭐️ ⭐️ Google Review

Client

Ascenti

  • Ascenti is the UK's leading provider of physiotherapy and mental health services.
  • The Ascenti team provides excellent patient care at over 400 clinics across UK, supported by office-based and regional teams.
  • Patients are treated by a national network of 500 directly employed Ascenti clinicians delivering upwards of 600,000 treatment sessions every year.

Challenge

Design and deliver a structured leadership programme for line and middle managers

  • Like many rapidly growing organisations, Ascenti identified their leaders needed structured development programme to enable their growth ambitions.
  • Ascenti's Exec Team asked us to come up with a bespoke programme.
  • The initial cohort would include line managers and middle managers, with various levels of experience.

A safe space for leaders to flourish

“From the very first meeting I had with Andrew he felt like part of our team and not an external consultant. He went on to lead on our management training using the Insights Discovery Personal Profile and is an amazing facilitator, allowing for everyone to participate and get the most out of each session.

He creates a fun and safe environment to allow effective collaboration and thought sharing. I would always recommend Andrew's services.”

Angela Shott
Head of Operations

⭐️ ⭐️ ⭐️ ⭐️ ⭐️ Google Review

Solution

LEAP: The Leadership Development Programme for Ascenti Managers

  • We designed a structure programme which included an Insights Discovery Personal Profile, formal training, action learning and personal reflection.
  • We delivered training to 3 Cohorts from September to December 2020, and broke-off into 7 smaller Action Learning Sets from January to April 2021.
  • The programme was delivered online to comply with COVID-19 restrictions, and we sent personal learning packs which accompanied the programme to each delegate's home.

Impact

Greater confidence and effectiveness from leaders at all levels

  • Delegates gave the Management Development Programme an impressive Net Promoter Score (NPS) score of 50.
  • Newly appointed managers gave the programme an outstanding NPS score of 65!
  • Delegates reported a 19% increase in confidence when talking about their own preferences, behaviours and leadership style.

Managers told us they were more confident, had greater self-awareness and a better understanding of others.

New and experienced managers

89% would recommend The Spark Company to others

New and experienced managers

90% would recommend Insights Discovery to others

New Managers

Newly appointed managers gave an average 91% satisfaction rating

Looking for a bespoke Leadership or Management Development Programme?

Do your leaders need to improve their self-confidence and effectiveness? Fed-up of off-the-shelf training that doesn't have any impact in the real world?

If you are looking for a programme that enables leaders to understand their personal strengths, preferences, blind spots and possible weaknesses, we can help. We support leaders to translate learning into positive changes to productivity and performance in the real-world

Give us a call for a friendly chat about how we can help your leaders flourish.

10 proactive things leaders can do now to influence company culture

 

I want to change things for the better at work and culture is top of my To Do list. Where do I start?

It is challenging, but possible, to change your culture. There are lots of tools available to assess culture and there are simple things you could try and implement straight away to make your place a better place.


A leader standing at a flipchart and working through some options to improve company culture with her team

I’ve pulled together 10 straightforward and pragmatic ideas for leaders who want to improve workplace culture. It’s time to get stuck-in with some practical and actionable things that you can do in any organisation.

I’ve split these actions into organisation-wide, team and individual actions. It’s best practice to hit all three levels to give your culture change a chance to stick.

But before you start, imagine your organisation as a complex web of different traits, habits, actions … ways of communicating. If you really want to get under the skin of what’s going on, check out our article on company culture blindspots and make sure you’re not missing something crucial to your team’s success.

  

Your organisation is a complex network of different traits, habits, actions and ways of communicating

  

Things I can do as an individual to improve company culture

  • Articulate your vision – Clearly explain what your vision is, get the senior managers onboard and create a plan to communicate across the business.

  • Live by your values – Make sure your decisions align with the values of the organisation, both in good times and tough times. Personally demonstrate the business values every day.

  • Talk to your customers – Find out what your customers really think of you. Using an external consultant here can encourage a customer to speak more freely and give honest feedback.

 

Things I can do as a manager to improve company culture

  • Analyse all available data – Gather statistics that reflect how your culture is impacting customers and staff. Consider: customer complaints, Glassdoor reviews, Trustpilot reviews, attrition rates/absences and staff complaints.

  • Listen to your team – Spend time with people. Visit the shop floor. Be seen. Be approachable. Get to know your staff and ask them what their experience of the business is.

  • Recognise how COVID-19 changed how teams work – How has hybrid working during COVID-19 impacted team culture? Avoid ‘forced fun’. Consider scheduling people to be on-site at the same time, so they can work together naturally. Online collaboration time can be as helpful as blocking-out time for deep and meaningful work.

  • Monitor workload & set boundaries – Make sure that everyone has an equal chance of success, time to meet customer expectations, and sufficient down-time. Consider a ‘no video meeting day’ each week, to allow space to focus.

 

Things I can do across my organisation to improve company culture

  • Survey your team – When did you last benchmark how people are feeling? You could survey all your staff to see how they are feeling about the organisation post-pandemic. (Maybe a statement of the obvious, but only do this if you have bandwidth to analyse the results, listen to what you’re being told and crucially, do something about it.)

  • Review your organisation design – Has any unfairness crept in due to remote working during the pandemic? Have you buried problems by some people not being physically present? Is everyone clear on who their manager is and who they go to for help?

  • Improve internal communications – Check your communication channels work and reflect your company values. Are you sending a weekly newsletter into a black hole? Are people engaged? Is it 100% broadcast or is there interaction? If you are getting interaction, does everyone have a chance to join in?

  

Quick fixes won’t create a lasting and positive culture

  

Invest in your culture

Why bother investing in company culture? Well, it’s no coincidence that happy, healthy, profitable businesses put aside time and effort into nurturing a positive culture. Let’s be clear, this is a conscious choice that leaders make to invest in a positive, inclusive and productive workplace culture. It doesn’t have to be difficult but culture change does have to be planned and coordinated.


A team of happy, healthy and productive colleagues work together in an open plan office

Taking action, particularly in a large business with lots of complexity, may feel like a mammoth task. This is particularly true if you’re not sure where to start.

Company culture is a bit like health & safety, compliance, safeguarding, etc.; it’s everyone’s job to develop and grow a positive workplace culture, but it starts with you. Leaders set the tone.

If the idea of cultural change is too much, an external consultant might be a worthwhile investment. It’s more cost effective to bring in a HR Consultant to do it right first time, than asking your team to try and pull together a plan for culture ‘off the side of their desks’ (and usually over a longer period).

  

Positive culture doesn’t just happen. Bring in an expert to get things moving and upskill your team

  

Depending on your workload and available resources, I’d always suggest allocating someone specific to lead on cultural change, whether this means bringing in an expert to work alongside and upskill your team, or giving someone a secondment or project opportunity. That way you’re getting focus and energy in the right place, and developing your own in-house capability at the same time.

However you do it, it’s all about enabling you to take control of your own cultural destiny and not being ‘done to’ either through inertia or reacting badly to events because your culture isn’t resilient or flexible.

  

I want to make positive cultural changes, but I need help getting started…

It can be daunting to get started, so you might need an experienced and knowledgeable HR consultant to assess your culture and create an action plan.

As a specialist in organisational change I love to get stuck-in and support clients to make positive changes in the workplace.

Get in touch for a friendly chat about how I can help.

  

 

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