Why goal-oriented organizations miss employee needs

Across the world while the pandemic continues to rear its ugly head, most billionaires have successfully managed to increase their wealth. In its analysis, titled “Pandemic Profiteers Exposed”, Oxfam found that 17 of the top 25 profitable companies in the US are likely to make $85 billion more by the end of 2020 compared to previous years. In India too, one look at the stock market and you know that wealth of wealthy is seeing new highs.

The rising inequalities

In some ways, the covid-19 crisis was no different from the crises of the past in creating new inequalities and compounding existing ones. Those with means are finding ways of using the pandemic to profit at the cost of those who are struggling to fight an uphill battle to survive.

Also Read | The global drive to reimagine capitalism

The most troubling aspect of this situation is that it is taking place within the four walls of some of ostensibly reputed and seemingly responsible organizations, where a drastic health emergency was an excuse to cut costs and increase margins. As revenues and earnings become dominant buzzwords guiding all decisions, humanity and compassion seem to have been thrown out of the window.

It reminds me of the movie franchise Purge, which talks about an annual national holiday known as the Purge, a day in which all crime, including murder, becomes legal for a 12-hour period. The licence to cut costs inhumanly is the unfortunate metaphor for the ugly purge we witness during this crisis.

As we near the end of 2020 it is important to ask three questions: What is the responsibility of those who have access to and edge over resources? Why do we give less when we can afford to do more? Why such purge actions are net negative for organizations?

Let’s start with responsibility. The fundamental truth we seem to forget is that organizations are built by people for the good of the society. The popularity of using environmental, social and governance (ESG) criteria to evaluate companies is gaining traction with investors. Environmental criteria consider how a company conducts its business protecting the environment. Social criteria evaluate how the company manages relationships with its stakeholders, including employees. Governance deals with a company’s controls and shareholder rights.

While environmental and governance criteria had been in news in the past few years, the spotlight on social criteria is a refreshing change, which I believe was largely ignored during the pandemic. ESG is a way of defining the responsibilities of those in business and those ignoring it would see fewer investors line up on their door. Thus, it’s not just a moral argument anymore, it is also a profitable one.

Why we give less

Let’s now look at why do we give less when we can afford to do much more?

Utpal Dholakia, professor at Rice University, argues that those who have more tend to be self-centred and more concentrated on their own goals. While those who have less tend to be more compassionate and sensitive to the needs of others because they are more focused on what is going on around them. Organizations that pride themselves to be goal-oriented tend to be self-centred and miss the point that the employees who work there could be more compassionate.

It’s also important to understand why such purge actions are net negative for the organizations. In today’s day and age, value is created through innovation and innovation is driven at the edges of the organization by motivated employees. Unless you believe in encouraging and enabling employees by putting them first and customers second, you will make little progress. Such purge actions are great in meeting short-term cost goals. Stock markets and boards may reward leaders for such swift actions. However, in the medium and long term, they destroy value as employees feel disengaged, demotivated. Such organizations gradually lose market and mindshare. Thus, it is important for leaders to resist short-term, kneejerk cost and job cutting tendencies, and see this as an opportunity by declaring a policy of no-employee left behind.

New year, new outlook

We need to review and reassess our priorities. Revenues are significant for business growth but not at the cost of human resources. Serious reassessment of how we work is necessary. Our guiding principle should be respecting each other.

While we focus on growth and revenue, let us sit back and reflect on what we can achieve collectively. Individual shortcomings—however, challenging—can successfully be countered by the coming together of many hands and minds.

One way is to reorient our understanding of growth to mean not just the rise of one or few but all. The second solution is to find ways to plug gaps in the system through give and take of knowledge, solutions and methods.

Uncertainties induced by covid-19 have brought to the forefront the fragility of human existence and the limitations of our vision. The only way to contain the impact of such uncontrolled variables is to learn from today’s lessons to prepare better for tomorrow as we welcome 2021.

Vineet Nayar is the chairperson of Sampark Foundation and former CEO of HCL Technologies.