Clarkston Consulting
Skip to content

Organizational Resilience Amid Economic and Employment Uncertainty

As we begin 2023 with a growing series of layoff announcements and continued debate around whether the U.S. will enter a recession, many organizations are faced with financial and employment uncertainty. Marc Benioff, CEO of Salesforce, announced a shrinkage of their workforce by 10%, while Amazon says it’s letting go of more than 18,000 workers. Goldman Sachs announced plans to begin cutting over 3,000 employees across their firm, and CPG manufacturer 3M announced they are laying off 2,500 manufacturing jobs globally given weakened consumer demand. These headlines are juxtaposed by a strong standing labor market in the U.S., where employers added 4.5 million jobs in 2022. Regardless of whether your company is growing, reducing, or restructuring its workforce, change is inevitable for employees across industry sectors. Companies that display organizational resilience are those with proactive leaders who ensure their employees remain bought in and engaged in the corporate values of their company despite turbulence. We’ve outlined a few cornerstones for leaders as they navigate uncertainty within their organizations. 

Communicate Frequently with Honesty and Transparency 

It’s imperative for leaders to play an active role in regularly communicating the state of their organization’s performance, goals, and context for how employees can support the objectives. You should consider the form of communication used, as people have varying preferences in how they receive information, whether it’s through a one-on-one meeting, a phone call, or a shared platform like Microsoft Teams. If communication is absent or infrequent, employees will speculate to fill the void, which can lead to angst and distrust.  

Great leaders serve as role models and cultivate a strong connection to the company mission despite market turbulence and uncertainty. If clearly articulated early and often, leaders can leverage a turbulent time to ignite employee motivation, improve productivity towards stated goals, and increase organizational resilience. The next level of communication lies in follow-through. Leaders who are honest and enable action toward their stated commitments gain a greater following and loyalty from their employees. People want to follow leaders that are transparent and inspire change through the toughest of times.  

Empower Employees to Make an Impact on Corporate Goals  

For many organizations leaning into hybrid or fully remote environments, leaders are increasingly questioning the level of productivity as compared to pre-pandemic in-person norms. As more than half (54%) of organizations believe productivity has improved with a move to hybrid or remote, leaders are reflecting on the policies and management styles that allow for more flexibility and motivation for employees to be successful. Some approaches that have proven successful are when leaders set clear performance goals and KPIs tied to the corporate strategy to set guardrails for employees to follow.  

An important element to success is empowering employees to reach their goals in whatever path or process works best for them. Leaders who provide individuals with autonomy to own their work tasks will see greater performance because employees are more motivated to accomplish goals that they had a role in shaping. This in turn puts more responsibility on the individuals to carve their path and take pride in the work they do. As leaders see their teams accomplishing their goals, they should follow through with recognition and rewards to positively reinforce strong performance. This recognition can serve as a positive focal area that employees rally behind.   

Foster a Sense of Purpose and Connection 

During challenging times, it’s even more critical for employees to feel a sense of purpose and connection to their organization and colleagues. A recent survey found that 53% of employees want their organizations to act on issues they care about. When leaders take time to seek input from their teams and follow through with actions to improve or address concerns, employees feel heard and valued and thus more committed and connected to the company.  

Establishing employee resource groups can bolster a sense of belonging and reinforce purpose within an organization. Providing space for mental, physical, and social health should be a top priority for leaders to demonstrate they care about employees in the hybrid workplace and ever-changing environment. Leaders who keep a pulse on their employee preferences can best deliver on the level of connection and resources that they need most. For example, some teams may require additional in-person meetings for innovation and employee satisfaction, whereas other teams may be more effective and productive fully remote. Given that this sentiment could change regularly, leaders should continuously monitor preferences and flex accordingly.  

To promote organizational resilience, leaders need to be mindful of fostering moments of connectedness regardless of workplace status. Keeping these tactics in mind will help set the foundation for employee connection and ultimately maintain steady alignment to the organizational purpose. 

Upskill and Train the Next Leaders 

Investing in training opportunities for employees yields returns beyond individual skill building – it helps improve engagement and empowers the next generation of leaders to take on important responsibilities for the organization. While there are trade-offs to consider between cost savings and talent investments, it’s important to consider the benefits of talent retention and the impact on cultural belonging.  

Training can also contribute to greater productivity through leveraging new technical, business, and interpersonal skills. We see positive returns when talent is upskilled to meet the evolving business transformation needs across organizations. Learning and Development leaders can build a stronger learning culture by creating personalized and connected experiences where employees have more say and control over how they learn. Building motivation for learning across teams can lead to greater skill development that supports future-proofing organizations in times of economic downturn. 

Looking Ahead: Organizational Resilience 

Change and disruption are inevitable, even in the most resilient organizations. What matters most in the wake of challenges is how leaders communicate with authenticity, empower employees to achieve, cultivate connection amongst teams, and invest in employees for the future. These actions contribute to employee satisfaction, retention, organizational resilience, and ultimately a healthy culture supporting the greater company ambition. Our organizational strategy experts are well-versed in advising leaders on transformation and strengthening organizations amidst change.  

Subscribe to Clarkston's Insights

  • I'm interested in...
  • Clarkston Consulting requests your information to share our research and content with you.

    You may unsubscribe from these communications at any time.

  • This field is for validation purposes and should be left unchanged.

Contributions from Erica Parks Murray

Tags: Organizational Effectiveness, Organizational Health