Enjoy this free preview from our Q4 cultural almanac. And if you like what you see, pre-order ZEITGUIDE 2019 to continue to receive these insights throughout the year ahead.
We noted at the start of the year that while efforts have been made to make work environments more fun and collaborative, the real work for businesses is addressing the larger issues plaguing the office.
In the wake of #MeToo, businesses embraced transparency and self-examined the behavior of leaders and employees. CEOs have begun to make their voices heard on key political issues like gun control and the environment. And in the ever-important race to offer the best possible employee experience (EX), businesses are doing more to create workplaces that offer flexibility and improved work-life balance.
Now, we’re seeing an even greater revolution arising as employees, demanding to make their voices heard, grow more empowered. Here are the prime areas where we’re seeing workers pushing back on their employers.
We’re Not Gonna Take It
On November 1, 20,000 Google employees participated in a company-wide walkout to protest allegations that the company had protected high-profile employees accused of sexual misconduct. Those protected included Andy Rubin, developer of Android mobile software, who received a glowing sendoff in 2014 along with a $90 million exit package, despite a credible claim that Rubin coerced another employee into performing sexual acts on him in 2013.
A week after the walkout, Google announced changes to its sexual harassment policies, including ending the policy of forced arbitration for sexual assault allegations. Under the old policy, employees waived their right to sue their employer, with cases being handled in confidential arbitration hearings with mediators chosen and retained by the companies, not employees. While forced arbitration saved companies from costly court cases and bad publicity, it also meant they were less likely to address their toxic cultures. Soon after Google’s decision to end forced arbitration, Facebook followed suit. Microsoft, Uber and Lyft all ended this policy within the last year, as well.
Tech Workers of the World, Unite?
Prompted by concerns over the use of new technologies in surveillance or in military settings, many rank-and-file employees in the tech industry are raising questions about the ethics behind the products they’re building.
At risk of alienating employees and potential new hires, tech companies are facing calls to be more forthright about their intentions regarding ethically dubious projects.
In Q3, we saw how pressure from Google employees led the company not to renew a partnership, dubbed Project Maven, with the U.S. Department of Defense that involved using AI to analyze videos and images—information that could be used for targeted drone strikes. Since then, Google has dealt with employee blowback and resignations protesting its efforts to build a censored search engine, Dragonfly, for the Chinese market. And Amazon continues to face calls from employees to terminate contracts supplying police departments with facial recognition technology.
Politics in the Workplace
More and more companies have been taking stances on divisive political issues, betting that the love gained from consumers supporting these stances will outweigh any backlash. So, where does that leave employees?
One particularly vocal brand has been Levi’s, which this year made a corporate donation of $1 million toward preventing gun violence. CEO Chip Bergh received some complaints from gun-owning employees, but overall, he believes his employees prefer to know where the company stands.
“They may not always agree with every single position or stand that we’re taking, but they appreciate the fact that we are willing to dive into these tough issues,” Bergh says.
Beyond their official corporate stances, companies are also being taken to task by employees for the political affiliations of their leadership. Facebook dealt with employee backlash after its vice president of public policy, Joel Kaplan, openly supported Supreme Court nominee Brett Kavanaugh. And in 2016, backlash from employees may have led to the departure of Palmer Luckey, the founder of Oculus, from Facebook based on his support of then candidate Donald Trump.
So, What’s Next?
Eclipsing politics or company values, we project even more vocal protests from employees about their paychecks. Despite corporate tax breaks and a strong economy, wage growth has been only slightly greater than the rate of inflation. In fact, only four percent of the 1,500 companies surveyed by consulting firm Mercer LLC reported putting a part of the savings from last December’s tax-code overhaul towards salary increases.
We forecast that in the future we will see even more employees demand employers show them the money. That may take the form of direct activism, with employees physically protesting or appealing to lawmakers to pressure companies to make changes. One response we’ve already seen has come from Amazon, which in reaction to criticism over low pay and backbreaking work conditions for warehouse workers announced a new company-wide minimum wage of $15 an hour. (Lest we give them too much credit, the company also eliminated stock grants and bonuses, which will lower the total compensation for some employees.)
With the strength of the job market, we might expect more employees to use an even more effective method for communicating their dissatisfaction: leaving. Unsurprisingly, compensation is still the biggest reason for employee churn.
So, what will come next? Will employee turnover motivate employers to reach into their tax savings to provide pay bumps? Will workers continue to gain more and more agency? Or could a turn in the market and the job losses it could bring once again give businesses the power to dictate the terms they want for employees?
At the start of the year, we noted how jobs that don’t fit the traditional nine-to-five are becoming the norm for more and more workers. And in fact, recent reporting by Gallup finds that 36 percent of Americans earn income as part of the gig economy or some other type of non-traditional work arrangement.
Not all gig work is created equal, however. That 36 percent includes on-demand gig workers like Uber drivers and Postmates delivery persons, as well as freelance workers who might be well compensated for their particular expertise.
On the one hand, those with in-demand expertise are taking advantage of the gig economy for greater flexibility and freedom. On the other, the gig economy also has individuals doing less-skilled, on-demand labor often for less than minimum wage and with none of the benefits or security that come with traditional employment. Gallup’s research describes this as a “tale of two gig economies.”
So, What’s Next?
For low-skilled workers, the gig economy became a way for companies to access their labor for less pay and fewer benefits. To no one’s surprise, those workers don’t stay with their gigs for long. Per JPMorgan, more than half of workers leave the gig economy within a year of entering it. Will a strong job market with fewer people compelled to rely on gig work to support themselves motivate the various companies in the on-demand gig space to provide better terms for workers?
On the other side, the gig economy continues to make it easier for skilled individuals to work for themselves, ramping up the pressure on companies to convince their most talented employees to stay where they are. It’s yet another reason for the growing importance of EX.
Those workers whom the gig economy has benefited are fueling the market for co-working spaces like WeWork, Knotel and Spaces, which provide not just a desk and WiFi, but also social and professional connections to other freelancers one may not get working from their couch. They offer “giggers” freedom, flexibility and the chance to hone their entrepreneurial chops with programs, community events and classes (we are doing one with WeWork called Crash Course in January).
The current $35 billion valuation of WeWork shows a strong belief in this model as the future of work for many. So, what does that mean for businesses?
It means creating work environments that incubate personal and professional growth by giving employees the time and space to learn new skills and test out new ideas. It’s this kind of atmosphere, not the open office concepts or beer taps, that legacy businesses need to adopt from startups in order to boost employee experience and create internal innovation.
After all, companies don’t just have to reckon with competitors or new startups poaching their talent. Now, they also have to protect against their best employees going to work for themselves.
At the start of the year, we noted how chief marketing officers, occupying the most tenuous position in the C-suite, have been undergoing somewhat of an identity crisis. For instance, we observed efforts to tie marketing to growth by blending the CMO role with the responsibilities of the chief revenue officer, thus forging the chief growth officer.
Two other popular CMO substitutes have been chief brand officer and chief commercial officer. A company that finds that its customer experience isn’t up to snuff may give its CMO the title of chief customer officer or chief experience officer, roles that evolve the CMO position to involve a greater focus on customer outcomes to accompany traditional marketing and brand-building responsibilities.
At Cannes Lions, our CEO, Brad Grossman, suggested CMOs should think of growth not just in terms of building a direct line to the consumer, but also utilize their knowledge on the consumer to fuel internal growth. By applying lessons from the direct-to-consumer connection directly to their company, CMOs can assume the mantle of chief visionary officer.
Since then, we’ve seen a number of other C-suite roles subject to this kind of title tinkering as companies work to keep pace with rapid changes in business, culture and consumers. Here are a few that have stood out to us.
So, What’s Next?
Creating these roles provides companies with the opportunity to issue attention-grabbing press releases and an incentive for promising execs to stay on, but keeping track of them all can cause a real headache. Often, a role where responsibilities are shared among these new chiefs already exists. For example, the privacy officer is really just a goosed-up chief technology officer, and employee mindfulness can fall under the chief human resources officer. Improved collaboration between CEOs, CFOs and CMOs can make the titles of CGOs, CVOs or CSOs superfluous.
And, at the end of the day, if everyone is a chief, doesn’t that mean nobody is?
While historically attention has been paid to a new building’s impact on the environment, we’re also now starting to see a focus on how good a building is for the people inside it. Consider the Well Building Standard, introduced in 2014 by real estate and technology firm Delos. Based on medical research on how people’s surroundings affect their health, the Well system has criteria across seven categories: air, comfort, fitness, light, mind, water and nourishment. Everything from the quality of a building’s air filters to the kind of snacks in the break room comes under consideration, adding yet another way employers are paying greater attention to employee wellness to improve productivity, retention and recruitment.
MANDATED GENDER PARITY
Following in the footsteps by France and Germany, California became the first state requiring publicly traded companies to include women on their boards of directors—a bold step toward achieving greater gender parity, though one that will surely be challenged in court. Should the law hold up to legal challenges, some 165 California-based publicly traded companies without female directors will have to make changes before the end of 2019. Boards with five directors will need at least two female members by 2021, and those with six or more are mandated to have at least three be women—a standard many of the state’s most well-known companies, including Facebook and Tesla, currently fall short of.
WHEN ARE YOU ‘HIGH’ AT WORK?
You wouldn’t necessarily consider someone who’d had a beer at a business lunch to be drunk, but what about if that pint gets switched for a joint? As marijuana legalization spreads, businesses are grappling with how to define when a worker might be high on the job. Nine U.S. states have legalized weed, and Canada voted to legalize cannabis nationwide on October 17th. “For the most part, we have a really solid understanding of how alcohol works. With cannabis, we don’t,” Jamie Jurczak, a Winnipeg-based lawyer who advises employers on workplace cannabis policies, told CBC News. “There’s no way of saying, ‘Well, here’s a hard-and-fast test where we can say ‘yes you’re impaired right now’ or ‘no, you’re not.’”
Pre-order ZEITGUIDE 2019 to continue to receive these insights throughout the year ahead.