How flexible organizations can create stability in the Great Resignation

After more than two years of the pains and pivots associated with the COVID-19 pandemic, it’s clear that both employers and employees are faced with an opportunity to reimagine the ways in which we work. By now we know that many workers are in a state of flux: The Great Resignation has become shorthand for a recalibration of the labor market that is taking on a different feel in different countries.

Figures from the end of 2021 show Australia saw the rate of job switching 10% higher than the pre-COVID-19 average. Singapore’s Ministry of Manpower said its resignation rates remained low during the pandemic, but more labor turnover is expected especially in growth sectors of the economy. The United States, meanwhile, saw a staggering 47.4 million workers in the United States alone voluntarily leave their jobs in 2021.

As the job market is running very hot, with record vacancies around the world, talented people have no shortage of options for work and career.

But there’s a risk that focus on resignations alone is making the phenomenon sound simpler than it should. At this stage of the great talent reshuffle, organizations will benefit from focusing on why employees are more mobile and what are the best ways to respond.

What employees want most

The data underpinning the reason for such a shift in resignations shows that workers are reassessing and reprioritizing what they value most from an employer, and they’re willing to act deliberately to fulfill those desires. More than just the resignations, one could see it as the result of many in the workforce aspiring to recalibrate work and life.

For many, this process starts with flexibility.

Nine in 10 respondents to the EY 2021 Work Reimagined Employee Survey considered leaving their job if they weren’t given it. On average, that included working remotely for two to three days a week.

The latest EY Future Consumer Index, meanwhile, confirmed flexibility (26%) in the top three key considerations for workers considering a new role, followed by compensation (25%), and purpose and culture (19%).

Moving on doesn’t necessarily equate to joining a different organization – the Index revealed that 24% of Generation Z, for example, want to start a business of their own.

This is a new wave of self-starting employees, who clearly understand the new technology-driven ways of working that the pandemic helped normalize.

“While it’s easy to get hung up on the threat of losing talent, it’s more constructive for organizations to focus instead on harnessing the ambition and energy that drive people’s decisions. Then use this understanding as a catalyst to transform the business and experience it offers,” says Maya Smallwood, EY Global People Advisory Services Employee Experience Leader.

“For many people, this moment is not just about taking stock of how they want to live life and how work fits in to that picture,” she says. “It’s also about whether the organization they’re with can move with them.”

5 proactive steps in the right direction

Here are five key steps leaders can take to move beyond reacting to resignations, to responding to employee aspirations:

1. Put humans at the center

In a world where work is increasingly digital and distributed, organizations will have to make structural changes to cater to people’s deep desire for flexibility, in an integrated way.

The first step is to listen to employees to find out what they want and make sure the organization’s perception of their experience matches reality. This may mean combining employee pulse surveys and focus groups with passive data sources to create a set of workforce personas that illustrate people’s preferences. This could also lead to better understanding of what the working experience needs to be, the operational processes needed to support, and how specialist teams can best work with the business leadership to deliver the changes required.

“There's no substitute for the human-centered design approach to help us understand what people need in an empathetic way,” says Smallwood. “Everything starts with data on how work is experienced, including the sentiments and preferences of the workforce. Leading organizations are going to use these insights to really evolve their business, to improve their value proposition, and to strengthen their ways of working in hybrid and digital environments.”

2. Strengthen your business culture

Organizations should take the opportunity to evolve their organizational cultures and to reimagine how a sense of community can thrive, even in a hybrid or virtual working world.

“What's most at risk by people working in a hybrid fashion is the maintenance of values and culture,” says Michael Thompson, EY EMEIA Workforce Advisory Leader. “People typically learn a company’s culture from time spent with their peers and clients. Anyone new to an organization who finds themselves working from home risks not benefiting from after-work drinks and informal lunches, or from quick feedback gained because they happened to pass the boss’s office. These micro-moments are now sorely missed.”

Organizations must work hard to find new ways to reflect their culture, so they can still make it real in the context of people’s day-to-day experiences in dynamic work environments.

This may mean fostering more cross-functional collaboration, and include finding ways to foster genuine informal contact remotely. When the needs of company culture and business engagement require people to be in the office, it’s important to communicate why. Any hint of presenteeism is likely to breed resentment.

3. Decide on your core competencies

These days, people want to be doing valuable work that rewards and validates them.

Organizations should be clear on what their most important work is, focusing their recruitment and development efforts on the core skills required, both to help retain their most talented people and to attract those looking for a more challenging, rewarding role. This will help the organization stand out to a digitally-enabled global talent pool, and a keen understanding of its abilities and place in the industry will also help foster a sense of community and purpose.

Any tasks that don’t fit these core criteria, because they are more mechanical or mundane, for example, should be considered for automation, outsourcing or co-sourcing with trusted third parties.

4. Invest in the people you already have

Organizations shouldn’t rely solely on their ability to attract new talent, especially when competition for that talent is sky-high. They should also be working to ensure their existing employees stay to grow with the organization.

“Up against a global skills shortage, you’re unlikely to find all the people you need,” says Smallwood. “You have to develop the people you have. This may mean motivating them by creating compelling training, or enabling them to take on a global assignment, to grow a team, or to participate in a new project in a way they hadn't anticipated.”

One much overlooked motivator is to give more acknowledgement to the informal influencers within the business, those who hold great sway because of who and what they know. These people are an untapped source of support and transformation. They can help organizations understand their people more, and to engage groups who may otherwise go unheard.

“When organizations ask their people to name a leader they trust, they may give the name of a person who’s not in a well-recognized geography or team, but is highly influential in an informal network,” says Smallwood. “We strongly recommend the types of analysis that allow organizations to see the quality of relationships, trust and how well individuals across functions are collaborating. It's about asking the intangible questions but getting the hard data to support the answers.”

5. Commit and communicate

Many organizations are failing to tell their people about the changes they’ve made – because they’re reserving the right to move back to how things were before the pandemic.

“This is not, and will never again be, just an HR conversation,” says Smallwood. “I’m seeing leaders across organizations eager to have these conversations. They're getting together, aligning, planning, and creating new functions and roles. It takes the enterprise working together, and it does take time, but the appetite for change really is there.”

“EY research in 2021 indicated that, while 83% of employers had planned for action in the journey to a post-pandemic new normal, 40% hadn’t actually indicated to their people what changes they could expect around flexibility,” adds Thompson. “Many don’t want it to become a permanent feature of their work environment; they want these policies to be short-term.”

Yet there’s little to be gained by such hedging. Organizations could instead choose to commit to bold changes and be proud to share the news.

This will require structural reform, buy-in at the top, and greater collaboration between leaders and across functions. And that means key decision-makers abandoning their silos.

If organizations align their resources to respond to the attitudes and aspirations of a more selective and empowered workforce, then those organizations can best position themselves for the present moment and for the future working world yet to be fully reimagined.