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Psychological and Social Factors in the Corporate Crisis: The Employees
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An essay by SEViX Partner, Prof. Dr. Immanuel Ulrich and SEViX Founder, Rainer E. Ulrich
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Clear communication
The recent crises triggered by the COR19 pandemic and skyrocketing energy costs have massively disrupted the global economy and caused socio-psychological stressors that affect the psychological well-being of workers. Fear of job loss due to economic closures, the challenges of digitization of the workplace, or fear of contagious diseases generated feelings of despair and panic among workers, even serious paranoid behavior. In the paper, we will explain how leaders, during corporate crises triggered by exogenous influences, used prosocial empathic skills to manage the psychological well-being of their respective employees so that they are motivated, engaged, and perform in a way that drives success.
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Perhaps the most essential element of crisis leadership is clear and trustworthy communication. Best practices for crisis communication, established through years of psychological and organizational research, include transparency, honesty and empathy.
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A strategic business transformation to end a corporate crisis is only successful if you convince your employees to go along for the ride. The best strategy is of no use if the company does not have (anymore) enough capable people to implement it. In a crisis, a CEO must steer and navigate the company like a captain navigates his ship in a hurricane. But a good captain is nothing without a good crew, which he also leads and motivates in a hurricane. The same applies to the CEO.
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The following skills must be demonstrably possessed by the CEO and C-level executives in a corporate crisis
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- Compassionate, empathetic behavior that positively impacts employee motivation and performance.
- open, honest and timely vertical communication, which promotes trust and retention.
- supporting employee autonomy, which impacts their well-being.
- promoting competence and self-skills among employees.
- fostering positive and healthy relationships by demonstrating compassionate empathy positively impacts mental health and thus employee performance in times of crisis.
- Communicate and convince credibly: what does he want? Why should his employees believe him that he is doing the right thing to successfully manage the crisis?
- Motivating: Why should employees "stay on board" when the storm hits?
- Leading: If the company is to become an outperformer (again), the CEO must also lead his employees in such a way that they can be outperformers in their work results.
- Be Agile and Live New Work: A company in crisis needs to get back on track in a strategically sensible and agile way. Employees must be empowered to (help) solve the crisis themselves in their area of work - they often have more of a clue than management in their (limited) area of work anyway.
- Resolve conflicts: No company crisis goes without conflicts. The CEO must resolve these conflicts in the company in a strategically sensible way to end the crisis. He must not take anything personally, regardless of how hard the conflicts become.
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From providing a unified communications platform to empathetic leadership, SEViX is unanimous in its belief that people are the company's best asset and that if they are well managed during a crisis, they can successfully navigate the storm.
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How to solve these problems is explained in the next essay, "Effectively communicating in a corporate crisis ".
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Please contact us directly if you need concrete help in change management projects or a managing director/CEO ad interim or a business transformation manager and a well-practiced team with implementation competence.
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