Economic uncertainty has been on the rise since 2016 — and the waves of turbulence it creates for companies and their employees show no signs of settling down anytime soon. From Brexit to COVID-19, trade tensions, and climate change, experts at the Harvard Business Review suggest global ‘shock events’ are here to stay.
Rather than keeping calm and carrying on, leaders must acknowledge that the onslaught of global shocks has serious affects on employees. Executive teams are often the face of communication during times of crisis and uncertainty — but managers are the ones fielding day-to-day questions from their direct reports.
Managers are also a key source of support, encouragement, and workplace stability. And without the right training, they may feel overwhelmed — especially when grappling with their own stress and anxiety.
Supporting managers to support their teams in the eye of the storm relies on equipping them with the information, processes, and tooling so that they can keep trust, motivation, and performance high.
Accepting and Adapting to Uncertainty
The world is in flux, and this can make employees feel uncertain and unfocused at work. Between the hours of nine and five, they may be worried about any number of external stressors — from rising electricity bills to how government policies are going to affect them in the future.
They may also be genuinely worried about the security of their job, especially considering the mass layoffs that are affecting certain sectors.
“The first instinct during periods of slow growth is often to reduce the resource base, including the employee headcount,” explained Dr Jack Wiley, author of The Employee-Centric Manager: 8 Keys to People-Management Effectiveness and Chief Scientific Officer at management consulting firm Engage2Excel. “But coming out of the pandemic, we have all seen the dysfunction of companies trying to meet customer demands with insufficient staffing. Smart companies will have learned from past staffing mistakes and show a great reluctance to reduce headcount in a way that underserves the customer.”
According to Wiley, making sure that business stays buoyant during challenging times relies on employee retention. Retention depends on keeping employees motivated and engaged to stay the course. Managers are key to making that happen.
As the contact point between the organisation and employee, managers foster engagement among their teams by building relationships based on trust and empathy. These qualities will be critical to helping employees adapt to uncertainty.
"Don’t have meetings for the sake of having meetings, facilitate a routine that builds consistency and calm."
“You can't have a meaningful conversation with someone without a foundation of trust, transparency, and rapport,” said Kelly Neupert, licensed therapist and leadership coach. “Managers have to develop high quality relationships with their employees and spend the time to get to know them as a human and an employee. Not for the sake of checking off a box, but for the purpose of actually getting to know them — what makes them tick, what they care about, and how they perceive work fitting into their life.”
To maintain trust, managers should keep communication flowing by making use of regular touch points with their direct reports. Conversations around accepting uncertainty — and how to adapt to it — can be carried out during appraisals, one-to-ones, developmental reviews, and informally throughout the day to give employees multiple opportunities to say what’s on their mind.
Neupert also recommends finding small ways to build routine and foster stability in other ways: “We get overwhelmed when multiple facets of our life feel in flux — our family, our work, our health. Try implementing or sticking to routines that your employees find helpful to keep them grounded. For example, don’t have meetings for the sake of having meetings, facilitate a routine that builds consistency and calm.”
4 Ways to Empower Managers to Lead Through Uncertainty
Supporting employees during times of instability is always going to be more challenging. But instead of avoiding talking about hard things, Neupert recommends approaching the issue head-on, even when you don’t have answers to share.
“Address the elephant in the room,” she recommended. “The worst thing you can do is not acknowledge the changes and act like it’s business as usual — it fosters distrust from your employees that you don’t know what’s going on, or that you don’t care enough to know what’s going on. Addressing the elephant in the room doesn’t mean you need to have a solution for it.”
In addition to prioritising transparency, managers can lean on strategies designed to help promote engagement and foster a culture of trust, even when times are hard. Here are our four best tips to boost motivation and keep engagement high:
1. Prioritise employee recognition to boost motivation.
Recognition matters — over 80% of employees say it has a direct impact on their workplace happiness. During times of volatility, acknowledgement and appreciation of employee efforts go a long way to maintaining motivation and engagement.
Using a performance management system makes it easy for managers to recognise high performing team members. And when integrated with public recognition, like Lattice’s Praise feature, it’s an impactful way for the whole organisation to share and celebrate hard work.
But recognition isn’t just good for telling employees they did a great job — it also helps foster deeper connections between managers and their teams.
“Without connection you’ll never achieve meaningful conversations,” said Dr Mario Brown, Chief Talent Development Officer at First Horizon Bank. “My advice on forming connections is to focus on practising empathy, curiosity and patience. Empathy can be perceived by some as soft and not goal-oriented but many researchers have come to suggest that it’s one of the most important qualities a leader can possess. Empathy is about understanding where an employee is coming from and how they view the world to create better and more productive conversations.”
2. Keep lines of communication open at all times.
During uncertain economic conditions, a strong People strategy is vital. Regular and compassionate communication from managers helps teams stay aligned, focused, and engaged — as well as making sure employees are empowered with all the facts.
“The absence of communication creates unneeded stress and anxious employees may step in with their own misguided interpretation of events to fill the communication vacuum,” explained Wiley. “That can lead to a downward spiral of morale and commitment.”
When discussing change and uncertainties, Dr Susan Bernstein, executive coach and leadership consultant, recommends a five-step process:
- Share facts: Share the information you do know in clear and simple terms, for example: “We’re going to be going through a reorganisation and it looks like 10% of staff will be cut.”
- Empathise with feelings: Managers should ask their direct reports how any facts make them feel emotionally, and if employees are willing to share, affirm those feelings, for example: "I can imagine you'd be nervous. That's totally understandable.”
- Identify desires: Discover what your team wants or needs in the face of change. Ask: "I can't promise anything right now, and I'll do all that I can for you. Given the facts I've shared, I wonder what your needs are so I can take those into account in my planning?"
- Anticipate decisions: Acknowledge that your team is likely looking for information so they can make decisions, like whether they’ll be able to afford loan repayments, or if they might lose their job. Ask: "What kinds of decisions are you trying to make, so I can do my best — within the parameters of my role — to find the information you're seeking."
- Offer direction: Managers need to help their team find direction in the midst of the chaos. Explain which parts of a new direction have been established, and explain if other areas aren’t clear yet. Ask: “In light of the facts that are unfolding, what direction are you considering next for your own work?"
3. Focus on employee growth and performance.
Placing employee growth at the centre of strategy during economic uncertainty helps teams feel valued, which leads them to put their best foot forward at work.
“During times of upheaval, one of the most important things managers can do is to keep their teams focused on their performance goals,” said Wiley. “Make sure performance expectations are clearly communicated, work priorities are clarified, and performance feedback is helpful and timely.”
Showing how employee growth can lead to advancement opportunities in the longer term can also help boost employee retention. In our 2021 career progression survey, 76% of employees said they were somewhat or very likely to leave their job if they couldn’t see a clear path to career development. And even in an economic downturn, there are still plenty of vacancies for them to choose from.
Outside of performance management reviews, Wiley suggests that “slower growth seasons can often represent a great opportunity to streamline processes and identify and eliminate obstacles to a team’s performance.”
4. Maintain engagement by fostering psychological safety.
During uncertain times, maintaining high levels of engagement have an important role in helping employees feel psychologically safe. And when employees feel safe expressing themselves, productivity increases as a result. Engagement surveys, whether longer questionnaires or pulse surveys, can help managers uncover how uncertainty is impacting their team, and how they can help.
Anonymous surveys can also be valuable during times of crisis, because employees may feel more comfortable sharing honest feedback. But while this might be a useful short term-strategy, creating a transparent and safe workplace culture means employees may be more comfortable sharing their honest feedback long-term. And this starts with managers being open themselves.
“Being vulnerable with your employees is not a weakness,” advised Neupert. “It fosters greater connection and relatability. Managers can admit they’re scared or anxious too. You don't need to send them into a crisis or elevate fear, but you can be real and honest about the impact of the situation.”
Leveraging Slow Seasons to Maximise Performance and Growth
“One of the main challenges during slow growth seasons is to keep people engaged,” said Brown. “Transitioning to a period of slow growth can feel challenging for employees who are used to working in a fast-paced, high growth environment. But the right approach from managers can turn this period into an opportunity.
“A slow growth season is a time to think about the future and develop your team by nurturing their skills and passions,” he added. “At First Horizon, we encourage our employees to invest in self-development opportunities during slower seasons. Not only does this benefit our organisation as a whole, but also conveys to our employees that we want to invest in their individual success.”
Brown's approach involves strategically setting up opportunities for employees to engage in brainstorming sessions and provide them chances to share passions. By doing this, it demonstrates their value to the company.
This strategy ties in with 2022 analysis from Deloitte, who predict that shifting towards skills-based practices can help boost organisational agility and growth. Skills-based companies are also 57% more likely to anticipate and react effectively to change — showing that time spent on training and developing during economic uncertainty is genuinely well spent.
“The best managers won’t allow times of uncertainty to distract them from providing training and development opportunities for employees, especially for top performers,” said Wiley. “Often, it is not the fault of employees that the organisation’s revenue growth and profits are stalling out or declining. And once business conditions stabilise and improve, it is a well-trained employee population that will rise to meet the increased work demands.”
Creating Stronger Teams That Can Thrive in Times of Change
With global shocks continuing to test both the resilience of companies and their employees, there’s plenty that managers can do to develop a toolkit for long-term stability. Honest, open communication is the first step as teams adapt to, and accept economic uncertainty.
“When times are uncertain, one helpful tactic is to call back to the things that remain consistent,” said Brown. “Both personally and professionally, individuals need hope to keep us going. As a leader, it is important to demonstrate ‘balanced hope’ to our team. Balanced hope is accepting reality but also reminding your employees of the potential opportunities and good things on the horizon.”
By engaging their team and offering opportunities for growth, managers can lean into slow growth seasons to bring stronger, more resilient teams out the other side. Our actionable, four-step performance management framework is a great place to start.