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How to manage people in a recession: decision making strategies
A recent workshop was organised by EQ Consultants at the Aldersgate Centre in Christchurch Central, and led by our Leadership Consultant, Joy Kuhns, a former VP of HR at ELORET in the Space Technology Division at NASA Ames Research Centre. She was there during the Space Shuttle Columbia mission failure, and shared valuable insights.
Leveraging her close personal connection to this event, her review of the findings report and the application of Whole Brain® Thinking, Joy crafted a workshop that allowed participants to examine the mishaps of the Columbia mission and identify gaps in thinking.
Attendees left with a better understanding of how to learn from failures and approach future projects in a more holistic, integrated manner. Their thoughts were captured below:
Christchurch leaders thoughts on the workshop:
Business projections and approach
As organisations navigate an economic recession, it becomes crucial to understand the current context and adopt a strategic approach that ensures resilience and success. This section sheds light on the potential concerns and offers valuable insights on managing people in challenging times.
According to McKinsey (2022) there are four potential concerns for businesses, which affect decision making:
- The potential for higher interest rates for longer, meaning that the cost of capital will increase. Organisations then need to figure out how to ensure they are economically sustainable by managing costs.
- With consumers being more reluctant to spend, along with this potential for increased costs, businesses need to be thinking ahead in their approach.
- The above two concerns mean that resources must be managed very effectively.
- Despite the three concerns above, businesses must work hard to attract and retain their employees.
The following are recommendations for navigating these four concerns:
- Being economically sustainable. Sometimes businesses make the mistake of enticing employees to stay, by offering them more financially. This can be a short-sighted view, one which some construction companies took during the Christchurch earthquake. By “out-bidding” employee wages, it meant some went out of business. There is clearly a need for salaries to be competitive – that’s a given! However, it goes alongside the fact that when businesses are trying to manage costs, they also need to be an employer of choice. The recommendations of how to do this are outlined below.
- Thinking ahead: Use the staff to help build ideas for today and the future! This can seem counter-intuitive – you may think “we don’t have time for brainstorming” or “we don’t have time for learning”. However, this will have the effect of making the staff feel valued. By recognizing and appreciating employees' contributions, they have a vested interest in the organisation, it helps them to learn and in turn, it helps them to grow their career. This will increase your staff retention rates.
- Managing resources effectively: A key to this is to leverage the staff for the most effective use of the collective brain power (see Herrmann Whole Brain thinking section below).
- Attracting and retaining employees: Be the leader who listens! By building a trusting culture and being part of a cohesive team, employees have a sense of belonging and are more likely to tell others about your organisation. This is the best way to build a strong Employee Value Proposition (EVP). By encouraging employees to be “who they are” at work, and by integrating work into their life through flexible work arrangements, they will want to do their absolute best for you. By adopting this approach and prioritising the well-being and engagement of employees, organisations can build a solid foundation for navigating the uncertainties of an economic recession and also help position themselves for long-term success.
Sound strategies for NZ businesses: navigating challenging times, using the Herrmann Whole Brain instrument.
Whole Brain Thinking
The Herrmann Brain Dominance Instrument (HBDI®) is a powerful psychometric assessment that defines and describes the degree to which we think in the four quadrants of the Whole Brain® Model. This forms the foundation for thinking agility, cognitive diversity and innovative thinking. The data helps participants adapt thinking preferences to communicate effectively, improve decision making and problem solving.
Whole Brain® Thinking is a scalable framework which provides a lens for improved understanding and insight. It acknowledges that different tasks require different mental processes, and different people prefer different kinds of thinking. Whole Brain® Thinking helps organisations get better results when they can strategically and leverage the full spectrum of thinking available. Herrmann clients include Coca-Cola, Cookie Time, Air New Zealand and ANZ, to name a few.
The Return on Investment using Whole Brain is shown in the graphic below:
Better Thinking. Better Performance. Better Results.
The HBDI instrument requires the participant to complete an online assessment.
Using this instrument as a “lens” to look at the Space Shuttle Columbia disaster as a Case Study
To comprehend the significance of this lesson, it is crucial to understand the brief history of the Space Shuttle Columbia Disaster.
In February 2003, as the Columbia Space Shuttle returned to Earth, it tragically disintegrated, resulting in the loss of all seven astronauts on board. NASA subsequently suspended space shuttle flights for over two years to investigate the cause of the disaster. The investigation board determined that a large piece of foam had fallen from the shuttle's external tank, breaching the spacecraft wing. It was revealed that foam breakage had been a recurring problem, but it was not adequately addressed, leading to intense scrutiny of NASA in Congress and the media.
Complex reasons as the cause of the Disaster: a Whole Brain “lens”
During the workshop, Joy Kuhns shared her first-hand knowledge of the historical Space Shuttle Columbia disaster and the key findings from the investigation by creating a large four-quadrant model, such as the one shown above.
Tables were provided with facts about the findings from the Columbia Report and asked to frame them up within the four quadrant Whole Brain® model. They collaborated to identify the gaps in thinking that contributed to these failures, while looking at the facts, the big picture, how things were organised and the effects on the staff.
The report pointed to cumulative factors whereby the foam breakage was only part of the story. Critical factors identified included the high-pressure external environment, complex systems, budget cuts and difficulties in communication within NASA that inhibited employees at all levels from reporting inconsistencies or failures. Tight deadlines and a lack of separate health and safety oversight contributed to a fear of reporting, hindering transparency and accountability. Additionally, there was a significant gap between employee and managerial perception. This resulted in many legacy errors going unreported, leading to the accumulation of bad data and poor predictive measures.
By utilising Whole Brain® Thinking, attendees recognised the importance of leveraging the strengths of different thinking styles within teams and fostering open communication. This approach encourages employees to speak up, share their ideas, and report any concerns without fear of retribution. To address these issues and promote a culture of accountability and transparency, leadership coaching and development are suggested as effective solutions.
In summary, the workshop highlighted the need for effective workforce management during an economic recession. It emphasised the significance of attracting and retaining talented employees by focusing on relational elements such as being valued, fostering trust among teammates, providing a sense of belonging, and offering flexible work arrangements. Studies, like the one by McKinsey (2022), have shown that companies that prioritise employee engagement and maintain effective communication during challenging times are better equipped to navigate recessions and thrive in the subsequent cycle.
If you would like to know more about the topics covered, be sure to check out the references below or to contact us.
- AIB. (2003, August). Columbia Accident Investigation Report.
- Blanchard, K. (2023, April 4). Improving engagement and retention through better work conversations.
- Blanchard, K. (2022, September 20). Three reason's people decide to stay, not stray.
- Ganjoo, U. (2022, September 16). Changing Role of HR in Global Recession.
- McKinsey.com. (2022, September 16). Something's coming: How U.S. companies can build resilience, survive a downturn, and thrive in the next cycle.
- 6 Seconds, The business case for emotional intelligence.
- Ulrich, D. (2023, May 12). 4 Strategies to help your organisation thrive in ambiguous times.
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