January 2023 – Management Events

January 27, 2023

HP’s Formula to The Future of Work: Co-Creating with Employees

Director Future of Work at HP Olga Martens-Stuurman, takes us through HP’s experience of creating a future-ready workspace, the importance of co-creating a future with employees, and the role of leadership in establishing an ever-evolving and inclusive culture.

What was the philosophy behind HP’s Future of Work initiative?

The questions we asked ourselves were what does it take as a company to be ready for the future? And how can we do it in a sustainable manner?

The future of work is not so much about hybrid work, although there are some hybrid implications. It is really about rethinking what is important for you as a company. When you talk about the future of work, do not limit yourself to where people work. Instead, look at why they work, what kind of work they do, when, and with whom.

The focus is also on empowering future-ready people. People are the center of many things that we do and if you want to be future-ready, you need to make sure that you offer enough growth opportunities for your employees.

Though there are lessons to be learned from the hybrid work model, what the pandemic taught us is that people can change and stretch quickly. We saw a lot of collaboration and creativity. Of course, there were also challenges. It was important for us to take the learnings from this hybrid period and ask ourselves how we can capture those learnings.

What are some key principles when it comes to preparing for the future of work?

When we look forward to the future of work, we follow three principles: empathy, a focus on culture and talent, and co-creation.

Empathy really starts with the assumption that not everything can be the same. One size does not fit all. The key is listening well to what your employees need because it is easy to implement something globally but often, you need to look at local rules and needs.

We have different generations in the same workforce, and they have different needs. Also, people are at different parts of their employee lifecycle. There is no single way that will lead to success.

We need to understand how we can create the best conditions for everybody to deliver their best work and that demands a lot of scenario planning. No one knows for sure what the future will look like, but you can prepare.

What is clear is that this is an iterative process. One of the things we learned from the pandemic is that we really need to adapt and learn. This is our culture.

Culture is not something that you just say, it is something that you do. It is something that we co-create together with our employees.

If you are going to ask employees for input, you had better do something about it as well. At the same time, make sure that you are very transparent because there is no way you can do everything that everybody wants.

Be clear that some of the skills that you currently have might not be enough for the future. So, you may need to upskill and have people undergo agile training while also allowing them to help you overcome challenges together. The most important thing is to keep the conversation going.

People are passionate about the future, and people are passionate about the company, but they need to have a voice. You have to make sure that these voices are not processed in silos without coming together.

How do you ensure people feel safe to share their ideas?

Psychological safety is not something that you just describe, it is something that you really need to ingrain in the culture.

It is really an important part of our culture at HP that we can be authentic, that we respect each other, but also that we are there to challenge the status quo and challenge each other. We focus on making sure that people really respect each other’s opinions and are inclusive in the way they invite others in and act upon that feedback. It is also something our leaders and employees talk about regularly so that it keeps improving.

How do you balance employee flexibility and organizational values?

Certain values are non-negotiable. That is really the heart of our company goals. But flexibility and values do not have to be in contradiction. There are times in a business environment when you need to save cost and invest, you need to optimize and increase. That is the same with flexibility. I do not think you need to choose. There are some core values like human rights, respect, dignity, et cetera you can never compromise on, but those do not conflict with flexibility.

Still, it is important to be aware of the challenges that come with flexibility and how to overcome them. There may be certain unforeseen or unwanted implications of flexibility that you may need to discuss and then adapt to.

What is an initiative that you implemented as part of your Future of Work program that was most successful?

I was doing this for customer support, and I asked everybody a simple question: Are you ready?

That had a huge impact on the leadership. Am I ready for the future as an organizational leader? What kind of trends maybe do I need to follow? How will my business remain relevant? And those questions were very true for managers and employees as well.

Some of our leaders said that we should make our own plan or someone else will do it for you. As an employee or first-line manager, life is already pretty complex. There is a lot to manage, so thinking about the future is a bit overwhelming. But the idea that maybe somebody else will make your plan for you might motivate you to free up your agenda a bit and think about some of the trends or expand your learning. That was a big aha moment in customer support.

We had so many people trying to invest in their learning and pick up new skills. And this was contagious in a way. People were so enthusiastic to get ready for the future. There was so much passion to learn and share, to get better together.

Sometimes a simple question – ‘Are you ready?” – can have a huge impact on an organization.

What are the challenges and opportunities in creating flexibility and autonomy, and how do you overcome them?

I think many people want to work for companies that offer flexibility. So, it is a way to attract and retain talent. There is much more technology now that makes it possible such as new working tools, asynchronous working, and remote mentoring. Also, employees have shown that they are very capable of stepping out of their comfort zone to do something new and challenge themselves. So, I think there is an opportunity to tap into a talent pool that maybe was not used before.

On the other hand, some people may not feel completely included or might have difficulties building up a network. It could also be that people work a bit too much and that can have an impact on work-life balance or work-life integration. You must be careful with the potential digital burnout. We need to be disciplined on how to say no and determine what is really relevant and what should be a priority.

So while flexibility opens opportunity, it also depends on people’s ability to deal with it as an individual or as a team. It is something that should be reviewed occasionally. You need to remain alert so that you do not miss some symptoms of fatigue or a lack of wellness for employees.

I think you need to be transparent and clear in your prioritization and really offer enough support to your employees so they can feel empowered and work flexibly.

How do you make sure these efforts for creating an agile, future-ready workplace are successful?

If something is important in your culture, you should model it. You should do it early, and you should do it often. Also, avoid big words and big concepts. Your message needs to be clear and simple. It should also be relevant for people in their local situations.

The other important thing is to remember not to strive for perfection. Sometimes you need to move quickly, so you may have to say “I do not know that yet” or “We will come back to that”. People appreciate that clarity.

Beyond that, communicate and be aware of how you do it. For example, younger generations communicate in different ways. You may need to try different mechanisms for different groups because even with the best intentions, you might have missed something.

Culture is not one thing you can define. It is evolving just as people evolve. We want to move fast, we want to learn, and we want to adapt. So, we cannot just talk about it. We need to show it in the culture. We need to keep on engaging with employees and building on that shared purpose.

How do you build the next generation of organizational leaders?

I do not think there is one simple answer, because I think context is always very important. Where are you leaders now? Where do you want them to go? Is there a big gap? Do you have time to close it?

I think it is important that you get some idea of what your current status is and where you want to be in the future. From there, you have different routes to choose from such as upskilling, reskilling, or hiring new talent.

It is critical to realize that what we need in the future will be different than what we need now from leaders. There is probably more attention now on power skills. I think it is important that we focus on empathy. On the other hand, there are a lot of technological changes as well, which means you also need to be at least digitally savvy.

Either way, ensure that you are not standing still and that you are willing to learn and adapt.

What do you think the future of work looks like?

I think the future of work looks bright for those people who are starting to prepare for it. I think there will be huge changes in why people work, where they work, when they work, how they work with whom they work, what kind of work they work on, and how much they work.

Also, employee expectations will change a lot. You will need to be able to listen well to employees, to adapt to their needs while keeping a good balance of growth that is sustainable. I think that is one of the keys to success.

*Answers have been edited for length and clarity.

January 25, 2023

The European Energy Crisis: Can Sustainable Energy and Improved Efficiency Save Us?

In the session, The Global Energy Crisis: Will Sustainable Energy and Improved Efficiency Come to the Rescue of Businesses in Europe? Prof. Dr. Marc Ringel answers burning questions on Europe’s latest sustainable energy innovations, the impact of policy changes on energy efficiency, and offers advice to businesses on how to navigate the current energy crisis.

Prof. Dr. Marc Ringel is the Director of the European Chair for Sustainable Development and Climate Transitions at Sciences Po, Paris, France. He reads energy policy, energy efficiency, and environmental economics as a professor at Nuertingen Geislingen University, Germany; and is a senior associate researcher with the University of Brussels, Belgium. He is also a former official with the Directorate General Energy of the European Commission and the German Federal Ministry of Economics.

What are the latest updates on energy efficiency policies in Europe?

We have varying gas dependency across European countries, from over 80% in Bulgaria to almost no dependency in countries like Sweden. Consumer prices have increased by 39%, and households and businesses are finding it hard to tackle energy poverty. That has had enormous political repercussions on the development of energy efficiency.

Energy efficiency policies have been increased and developed over two issues — tougher regulation and more comprehensive financial support.

That has been coordinated through the European Commission and the REPowerEU initiative. There are ongoing negotiations that will give us more mandatory objectives in terms of energy efficiency. I think European governments have understood that a speedy transition and phasing of energy savings and energy efficiency come at a cost. What the EU has been doing on the other side is financial support. They have set up a recovery and resilience facility which is designed to support a coordinated transition of energy efficiency to help businesses and consumers save energy. There has been €225 billion worth of loans and €20 billion in grants stemming from the EU Commission trading system to support energy efficiency.

What can we expect from sustainable energy in Europe within the next two years?

Sustainable energy was pretty much on show for larger climate objectives since the EU aims to fully decarbonize by 2050. 80% of European greenhouse gas emissions are energy related. Energy transition and clean energy initiatives were already at the heart of the European decarbonization project. Of course, that has been strongly advanced by the fossil fuel crisis. In concrete terms, this gives the EU a solar energy strategy. The plan is to double the photovoltaic capacity within the EU to 600 gigawatts by 2030. That combined with electrifying the European heating system with heat pumps will see a massive uptake in all EU member states. There will also be stronger regulation of energy efficiency.

There are two directives setting the scene, one is the Energy Efficiency Directive, which provides regulation on energy efficiency objectives, and encourages the public sector to use and procure energy-efficient products. They also offer financial support for businesses and private customers to go into energy efficiency. On the other side, there’s the Energy Performance of Buildings Directive, which aims to reduce the energy consumption in buildings, and will see tougher and more stringent building standards. There is also a strong strive for green hydrogen, which is hydrogen produced by renewable energies. The strategy of the EU is to develop that partly at home but also get green hydrogen partnerships across the globe.

How will the increase in sustainable energy impact businesses?

There will be two big impacts which are regulation and financial support. We are going to see mandatory energy audits and energy management systems for SMEs in EU member states. Those are designed to support businesses and help them become energy-efficient across the production chain. We will see more regulation in terms of saving energy and being more transparent about it. If it’s well designed as a mandatory measure, it would support the industry to be more systematic about energy savings.

And there is the question of the amount of money to become fossil-free. It will be an expensive transformation that government budgets alone cannot cover. There has to be private finance stepping in. Therefore, we are going to see business opportunities for the development of energy services.

The largest scale is to support private households with building renovations and optimizing production chains. It’s the golden time for energy service companies in terms of getting the transformation along in a market-driven manner.

We will also see a stronger development of public-private partnerships in the development of technologies and business models. It’s already working in industrial sites and electric mobility. Energy services will be quite active and solicited to delivering market solutions.

What sustainable projects are going to be implemented in Europe?

The combination of photovoltaic systems and heat pumps will create autonomy within households. Heat pump technology will be developed along with the trend for electrification. We will see an increasing number of e-mobility projects. According to Horizon Europe, there is €99 million allocated for clean energy projects in 2022. Over the next few years, there will be projects that will link energy and information technologies at large. For example, optimizing energy systems with artificial intelligence, data, and behavioral economics. Denmark is leading by example as the Danish integration of wind energy has been a strong driver for many other European countries in terms of how to develop offshore wind energy. I would also name Germany for getting energy savings and credit optimization by doing tenders for unused capacity.

When do you think the energy crisis will be resolved?

It will be the role of governments and the European Commission to give us a coherent policy stream. It will be a long development of energy efficiency and energy savings, in addition to phasing renewable energies into heating and cooling, probably to some extent by green hydrogen. In terms of structure, it will be a question of market design and market rules, which will need to favor energy efficiency and energy savings, much more than it has done so far. Many European governments are looking into the market design of electricity markets or heating markets. Europe is still importing most of its energy sources and that import dependence will continue to exist. Another consideration is about new supplier relations defining new energy partnerships.

What will happen if new policies and alternative energy sources are unable to solve the crisis?

Supply dependence and economic dependence. There is still diminished but flowing Russian gas filling up our gas storage. That gas certainly will not be available to fill up our supplies after this winter. Many European governments are preparing for the next winter by finding new partnerships and suppliers. LNG is an option but there is a global demand for LNG, especially in Asia, which raises its price.

The actual situation will depend on many factors which are outside of our control. Will there be a mild winter so there is no strong need to tack gas supplies? Until now, prices in global energy markets have been moderate because the demand from China and Southeast Asia was not at its usual limits.

The European governments have been going on a shopping spree on their own, which didn’t necessarily work out to their benefit and led to much higher prices paid. And there is the question of the European Commission coordinating or taking over the buying process globally. In terms of customers and businesses, there is currently strong subsidization of the energy bills for private households.

There is a clear need for subsidies, but I would caution against prolonging unnecessary subsidies. In the long run, there will be a much stronger need to revise our market rules and pricing to reflect the change towards renewable energies better. In the short term, subsidies work as contingency measures during winter but in the long run, work needs to be done on regulation.

That is a short list of unknowns, which makes it really hard to predict how bad or how good next winter is going to be.

Do you think that a strong government stance on energy savings will last over the next few years?

I think that by now, governments have understood that we need it for two reasons. Firstly, energy savings translate into price competitiveness. There are bigger problems on the horizon and that is climate policies and climate change because it is a polycentric crisis. Those issues combined will create strong pressure on governments to maintain strong energy efficiency policies. In terms of shortcomings, it’s a problem over the last mile. Many governments over the years have agreed on strong targets but did not follow up in detail.

That is exactly what’s happening with the negotiations on European energy efficiency regulations. It’s really a question of coordination. Member states are willing to grant the supervising coordinating power to the EU. Energy efficiency is not easy. Policymakers can open up a wind park, photovoltaics, and solar roofs, among others. Those are nice for show-and-tell policies. Energy efficiency is more technical, complicated, and less than visible. There is still the idea that energy savings are a government-run show. There is a clear need for private initiatives and business models to deliver energy savings and efficiency.

What can businesses do to maximize energy efficiency, reduce carbon emissions, and improve sustainability and resilience this winter and beyond?

The first thing would be to get an energy manager or professional to guide you in implementing energy efficiency, that’s a no-brainer. But what is often overlooked is that small fuel savings can top up over time and that’s a story of scale. In addition, what has been proven to work is getting professional third-party help. Energy service companies can analyze and scrutinize your production chains and businesses. They can propose not only advice but also financing models and technical solutions. You would want them in over the winter and reduce your costs quickly.

*The transcript has been edited for length and clarity.

January 25, 2023

The Impact of COVID-19 on Businesses

There have been many ups and downs in businesses since COVID-19 was declared as a pandemic by the World Health Organization (WHO) on 11th March 2020, and the effect of COVID-19 on businesses have been many since, as countries established lockdowns in early March, following China’s quarantine measures.

At the time, Management Events ran a survey to find the impact of COVID-19 on businesses, what they were facing and anticipating, and the strategies they were forming to ensure business continuity.

In this follow-up report, we uncovered new insights on how top companies in Europe managed business disruptions from the coronavirus, and what their strategies were as the pandemic continued.

Recovering from the Impact

Our previous Executive Trend Survey found that 64% of executives anticipated the coronavirus to have short-term negative business impact with the majority expecting ‘business as usual’ within 2 – 3 months.

After 5 months of the pandemic, in one of our surveys with over 1,000 decision makers across Europe, out of the organizations that were negatively impacted by the pandemic, 31% said that they were currently in the recovery stage while 12% were already headway into the growth stage.

As it had been almost half a year since the coronavirus impacted businesses and operations worldwide, it was expected that affected firms would implement steps and processes to ensure the recovery and continuity of their business.

However, post-COVID-19 effects on business growth are another matter. With the anticipation of a volatile demand environment and unpredictable market behavior, organizations started identifying new growth areas and rethinking their corporate strategies to be more resilient and competitive for the coming future.

In fact, according to our survey, 43% of respondents anticipated a growth in business within 3 and 12 months after the survey was made.

Among the industries surveyed, the majority of respondents who anticipated slow revenue were from the banking, insurance, and financial services industries.

Covid-19 Effects on Business in Revenues

Based on our survey done 5 months prior, results showed that 86% expected a significant revenue drop due to direct COVID-19 effects on business, whereby 33% predicted a fall of more than 15% while another 33% forecast a 10% decrease or less.

Even 5 months down the road, businesses were still anticipating the negative revenue effects of COVID-19, showing the long-lasting financial impacts of the coronavirus.

44% of respondents were forecasting a drop in revenue in the upcoming 6 months. Meanwhile, the rest expected a revenue increase, but with the majority (40%) forecasting only a rise of less than 15%.

Nevertheless, business leaders were optimistic about their future financial flow, with 52% predicting a revenue increase of at least 15% within the coming 12 months and 18% foreseeing a boost of 15 – 30%.

The healthcare services sector was among the topmost industries that predicted a drop in revenue, followed by banking, insurance and financial services, logistics and transportation, and industrial products and equipment.

Budget Revision for Business Continuity

Revisions of budget and business strategy were the top focus areas for organizations in ensuring the smooth continuity of their operations.

59% of business leaders in Europe were reworking their budget plans and predictions in light of the pandemic effects, followed by a revision of business strategies and goals (50%). Meanwhile, cash flow preservation was a key focal point for 42% of businesses facing negative disruptions from COVID-19.

However, a majority of companies that started rethinking their goals and budget for 2021 were only implementing slight changes to their goals albeit with a lower budget.

On another note, organizations were also reviewing their client communication and sales channels, with 47% expanding their digital customer service channels and 37% increasing the adoption of digital sales channels.

Remote Work to Continue

As expected, video conferencing and online chat platforms (86%) were top technology investments as organizations continued with remote working. However, a number of respondents commented that their firms were already well-equipped with digital and remote work technology even before the pandemic.

Trailing behind online communication channels was the use of cloud technology, which was a key investment for 47% of executives in helping the effectiveness of remote collaboration and productivity. This was followed by cybersecurity software (29%) and project management and collaboration tools (25%).

Throughout the months prior, it was evident that “enterprises leading in digital transformation were significantly less vulnerable to the epidemic”. However, the number of organizations that were ahead in digitalization efforts and IT initiatives was in the lower percentage.

Only 15% of our survey respondents disagreed that the outbreak forced them to accelerate their digital transformation, compared to 64% of executives who agreed with the statement.

Data Reigns over Cybersecurity

Pre-COVID-19, cybersecurity was named as the topmost tech adoption for organizations’ business strategy in our survey.

At the time of this survey, while cybersecurity was still a key investment for 49% of surveyed executives, data science and analytics held the highest priority for 61% of business leaders.

Furthering emphasizing the importance of data, 79% of the respondents agreed that they were looking to update their existing data analytics models to accommodate changing market behavior.

This finding was in line with Forbes’ article on analytics spending, whereby “49% of enterprises were either launching new analytics and BI projects or moving forward without delay on already planned projects.”

Bullish in Bouncing Back

Perseverance, determination, and innovation are driving factors for organizations navigating the business implications of the pandemic. And our findings have shown that businesses are bullish in their ability to bounce back to ‘normal’.

As seen from our previous survey, 88% of business leaders expected to have their businesses back to operational levels within 6 months.

The finding corroborates with our previous survey, by which more than 75% of surveyed executives had a positive business outlook for 2021. 39% were predicting stability for the coming year while 38% were expecting business growth.

Moving Forward Post-Covid-19

For certain industries, the few months prior to this survey were a bleak time for their businesses, and for some, the impact of COVID-19 on businesses might be longer-lasting than others.

However as stated by a respondent, there are positive effects of the coronavirus crisis, such as the acceleration of digital transformation and IT initiatives.

COVID-19 clearly showed that businesses cannot afford to be complacent, and to constantly reevaluate their processes and strategies – not just for the resilience and sustainability of the company, but for the good of their workforce and customers as well.

January 16, 2023

How Spotify Successfully Approached the Future of Work

In a globally competitive and rapidly changing environment, organizations are determined to create a seamless employee journey during the digital HR transformation. Spotify’s VP of HR Freemium and GUs, Anna Lundström, takes us through their approach toward the future of work during our online insights session.

As one of the architects behind Spotify’s work-from-anywhere approach, or what they like to call the ‘distributed first work experience’, Anna mentions three key factors to how they developed this formula.

Offering Full Flexibility

Though it is already a flexible employer, engagement feedback showed that Spotify employees wanted even more flexibility. This led to the company starting work on this work-from-anywhere program back in 2019. Of course, the pandemic in 2020 accelerated their efforts which led to the initiative being officially launched in February 2021.

Anna noted that everything was based on their philosophy to “become a distributed-first company, enabling our talent to create value for Spotify independently of where they work and remove constraints from scaling the platform”.

Here, Anna emphasized that every organization would differ in its goals and philosophies.

“My advice is not to copy just another program and call it a day, but really take a step back and think about what your culture is, what will work for you, and define it with one belief.”
– Anna Lundström

At Spotify, the belief is that work is not something that people come to the office for, it is something they do. This led the organization to put together a whitepaper and a handbook for this new approach of work-from-anywhere.

Ultimately, they came up with different work modes they could offer their over 10,000 employees around the world. First is a Home Mix where employees spend most of their time working from home with the option of a couple of days in the office per week. The reverse of that is the Office Mix. In regions where there isn’t an office, a Co-working Mix is offered.

Full flexibility also means that Spotify offers employees the option to work from another state or country where the company has a legal entity. To make this easier, employees are also grouped into different regions – the US, EU, and Asia.

To ensure that the program runs as smoothly as possible, Anna and her team spent plenty of time before launch to consider every possible question and constraint that might come up. They spoke to management and stakeholders to understand the different jobs and roles within the company and what they can offer in terms of flexibility. For example, some jobs may be tied to specific regions and wouldn’t be able to get full flexibility. However, the majority of roles do have that option.

For tax purposes, Spotify also instated a 12-month commitment for employees who want to move. Meaning they have to commit to their new address for at least 12 months. Anna noted that this gives the organizations more security in not only knowing where their employees are but allowing them to stay compliant with local regulations and tax requirements.

Adopting a National Compensation Benchmark

With the idea of allowing employees to move anywhere within a specific region came the question of compensation. Do they keep the same salary? The short answer is yes. Spotify opted for simplicity because a complex compensation structure would be difficult to scale, according to Anna. The team worked closely with HR, legal, and finance to consider every angle of approach including compensation policies and travel philosophies.

For example, a Spotify employee in New York who wants to move to Minnesota would keep the same salary instead of having it adjusted to the regional market rate. This is because Spotify has moved into what they call a national salary band. They wanted to solve any potential issues that might crop up if they lowered salaries when employees moved.

However, if an employee moved to another country – for example from England to Spain – they would get to keep the same take-home salary in the new currency. Anna stressed that everyone is taken care of when this is done as they are able to make the same level of pay that fits the new market conditions that they are in.

For now, Spotify is in over 40 different countries – giving employees a lot of choice and flexibility in terms of where they want to work from. If they do decide to move, Spotify will also handle the cost and processes of the visas and employment-related paperwork. The organization is also continually assessing where it would like to establish an entity. Most recently, they established an entity in Ireland.

Anna mentioned that Spotify has seen incredible results from this level of flexibility and preservation of compensation including reduced attrition and increased applications by top talents. The company also reduced the time taken to fill a position from 48 to 42 days.

Remarkably, Anna also noted that her team was able to answer every single question that was raised by employees when the program was first launched thanks to how thoroughly they had thought about everything in the playbook beforehand.

“That was the key to success… There were not a lot of things in our program or policy that we had to update or change because we thought it through early on.”
– Anna Lundström

Creating A Dynamic Workplace

Another aspect of the work-from-anywhere program in Spotify is their introduction of a new way to design or think about workspaces more dynamically. Anna talked about how the organization’s workplace services team spent time with stakeholders across the business to understand what drives them and how they work in order to come up with the best set-up for everyone. For example, engineers get plenty of screens while creatives get more space for whiteboarding. Other examples include focused spaces, spacious cafeterias, and social spaces.

Anna stressed that the goal is to create an environment that fits all employees regardless of their roles because there are employees who work on a range of different things within the company. This kind of thoughtful design enhances collaboration and innovation, she added.

One of the challenges with such high levels of flexibility and remote working is maintaining company culture. It’s something Spotify takes very seriously. When asked about how this is done, Anna explained that every new employee gets to visit Spotify’s headquarters in Stockholm to spend a few days being introduced to the company culture and leadership, and to familiarize themselves with the organization’s strategies and goals. They also conduct several different virtual sessions throughout the year, including with top management, to nurture and cultivate the company culture.

Anna pointed out that it is also important to allow culture to evolve while ensuring you remain steadfast to your organization’s values. Trying to stick to the same company culture that was developed at the beginning while you are scaling up – i.e. still using that start-up mentality – will present many challenges. Evolution is key.

Practicing Trust and Transparency

When asked about how Spotify balances the interests of employers and employees when offering flexibility, Anna mentioned trust. Being a values-driven organization, Spotify has a performance development philosophy in which employees drive their own development with the support of the organization.

“We support their growth and we put a lot of trust in our employees to drive it. We emphasize self-leadership.”
– Anna Lundström

Beyond that, Anna mentioned transparency as being another key to empowering employees. This can look like being open with employees about the state of the company, goals, targets, long-term vision, and OKRs. This must happen at every level from the executive team right down to line managers and team members.

Consequently, Anna notes that advocacy comes into play as well. While employees are given the freedom and power to shape their growth, some may require or prefer a bit more structure otherwise they risk burning out.

This is where mental health and wellbeing is prioritized. The team at Spotify is focused on destigmatizing discussions around mental health and creating a safe space for people to talk about their struggles and ask for support when they need it. Some questions that Anna notes are important for leaders to ask include: Do they have the right technology, processes, and support? Is there enough investment in important tools to prevent burnout?

Work-life balance and mental health care have to be modeled by leadership, according to Anna. For example, if a manager chooses to work late at night, they shouldn’t expect their teams to be pulling the same hours. Anna stressed that empowering employees is about being clear on what the priorities are and offering support, as flexibility alone isn’t the answer.

Final Takeaway: Experiment and Adapt

In the end, Anna’s advice for leaders who are trying to prepare for the future of work is to “think as a futurist, build scenarios of the future, and make bold choices” to fit what is best for your organization. Instead of copying a program, make it your own.

She also stressed that leaders should not try to do everything at once as they will surely fail. Instead, take it as a journey of learning where mistakes will be made. It is more important to experiment and adapt as that is the only way to create the best possible future for everyone.

January 9, 2023

Olivier van Duüren: Finding the Balance Between Transforming and Performing in Business

We speak with Olivier van Duüren, transformer, executive whisperer, trend Sensemaker and former Microsoft executive, about his first book, The Dualarity, and his second book, Transforming While Performing, co-authored with Kristof Braekeleire to be released in May 2023.

Don’t miss Olivier van Duüren’s opening keynote speech on Transforming While Performing at ME Executive Day in Belgium on 25 April 2023. Join now.

What was the inspiration behind your first book and business, The Dualarity?

My business adventure started on 14 August 1994 when I joined Microsoft. I had no idea how powerful that decision would be or how it would flavor my future life. So many experiences, so much personal growth.

In July 2016, after 22 years, I was ready to cut the umbilical cord with Microsoft. I followed my passion, made room for something to grow while ending an era, and gave birth to The Dualarity, a book and a business. As an independent entrepreneur, I also wrote this first book, about personal and business transformation, which probably has been in the making for 22 years. It provides a comprehensive overview of what is happening in the world, with a big focus on digital transformation, and I thought deeply about how you can respond as an individual and as a business in your transformation.

I put my heart, body, and soul into this book. It became an imprint of my observations of the world, people, and how I see it shaping. It’s fed with facts, research, and personal learnings of my personal transformation as a person and in business. Writing it helped me to structure my thoughts and experiences, and almost felt like therapy leaving the Microsoft ship.

Your second book, Transforming While Performing, will be released in May 2023. Is it a continuation of The Dualarity or does it cover something new?

The premise of the book is how to Transform while performing by finding your North Star and getting everyone to act faster. This book will help organizations find their North Star, develop a strategic plan, and get everyone aligned in days, not months. We’ll also talk about how you can see the world and how to transform as an individual and as a business.

Now more than ever there is pressure on any organization to transform while performing. It is extremely challenging to keep an open mind to refresh your future vision and define a direction of travel. How can you harvest the collective human intelligence to build your strategy and align all stakeholders in a co-creative and inspiring way, so they feel it is their plan, not someone else’s? How do you get everyone to act in days not months? How do you turn transformation into a strategic capability? That’s what this book is about.

What is special about this book is the strong combination of writing and visualization: half of the book will be visuals.

I’m co-authoring this book with Kristof Braekeleire, who is a visual facilitator and visual strategist. We believe in the power of visualization. Over the last six years, we’ve had many meetings using large murals and saw how graphic facilitation enhanced group learning and increased participation. Visuals also create a collective memory of an event. So, we’ve used lots of visualization in this book to explain things and give practical tips that keep the readers engaged. It’s a book about transforming while performing that is powered by inspiration, visualization, and co-creation.

What is the difference between performing and transforming?

It’s a real balancing act for individuals, teams, and businesses to make a distinction between the two.

Performing is delivering on your commitments. It’s the performance of today, what you produce, sell and deliver in a given period, like the fiscal year. It’s where you are trying to optimize productivity, efficiency, and effectiveness. We call this operational excellence.
Transforming, on the other hand, is where you build your future in the long run. It is the true power of an organization. It’s what you do now to perform in your future. Employees, customers, partners, and investors will stay with you if they believe you can bring them into the future and deliver value that will improve their lives. That’s what we call innovation excellence.

Innovation excellence is not just digital or technology, it’s how you build your business model, how you relate to your customers, how you organize yourself, how you treat people, how you change the structure in your organization, how you build the ecosystem, and having an open mind. Technology is just one of the elements that can help you as a company.

The challenge is how to balance performing while transforming. Many companies that have been around for a while tend to spend so much time performing that they are killing creativity and innovation.

You know, start-ups probably have too much transforming and not enough performing. At some point, they will need to close deals and sell their products and services.

It’s such a challenge finding that performing-transforming capability in an organization. Having the power of operational excellence and innovation excellence drives people and businesses to become the best versions of themselves.

Having held top management roles at Microsoft for over 20 years, what are the key capabilities leaders should possess to ensure successful transformation in their organizations?

The power question here is how you can turn transformation into a strategic capability?

Leaders must be willing to challenge every aspect of their organization. This includes their North Star, business model, operating model, people, culture, and also themselves. The legacy still serves present performance, but you’ll need to sacrifice parts of it to help the transformation come to life. Leadership models and approaches of the 20th century are no longer fit for purpose in the 21st century. Today, more than ever, a leadership team must have the right mix of performing and transforming capabilities. That is a condition to succeed in any major transformation.

Leaders need to surround themselves with people who are more visionary, innovative, and able to inspire the troops and navigate them on the ship. But they also must be supported by strong performers who are the operational masters behind the buttons able to execute that vision.

Here are some important questions leaders should ask themselves:

Do I have the right skills for transforming and performing in my leadership team?
How can I build a capabilities-focused leadership model?
Do I have diverse leadership talent and styles in my team?
How do I operate day-to-day performance while transforming for the long term?
Do I have a culture of trust powered by collective leadership and a strong CEO?
Do I manage the tension that transforming and performing creates?

Many organizations struggle with the tension between transforming and performing. On the one hand, there is a need to value learnings from experimentation and failures while valuing outstanding performance. Meanwhile, you have to manage well-being while hardcore showing results. We are convinced great leaders can openly and transparently acknowledge that tension to people.

What are the characteristics of organizations that have successful transformation initiatives?

When you look at the top 20 business transformations of the past decade published by Harvard Business Review you can observe some clear patterns. Companies like Netflix, Development Bank of Singapore (DBS), Microsoft, and Philips made that list.

These companies had the following in common:

Ready to reinvent themselves with a new future North Star: Not afraid to let go of the legacy and leverage the core capability to reposition its core while entering new growth areas.
The right leadership capabilities to transform: Striking the right balance in operational and innovation excellence. Able to operate at a fast speed in reviewing strategies or relocating resources.
Turned transformation into a strategic capability: The ability to stay young, hit refresh, future-proof or re-imagine their North Star (purpose, ambitions, value, culture), strategy, and leadership ready for the fast-paced world.
Saw digital as the oxygen of the company: These companies seized the digital opportunity. Made data-driven decisions and leveraged digital for new platforms and superior business models.
Put customers at the heart of the company: They always keep the customer in mind. Instead of thinking about customers, they think like customers.
Value people as the soul of the company: They saw culture as the backbone of the organization with people being part of the transformation. If you take care of your people, they will take care of your customers. People are loyal to a culture, not a strategy.

You talk about the need to re-balance existing or add new investments in products, services, processes, markets, platforms, and business models to iterate, innovate or disrupt. What do you mean by this?

A business transformation is a strategic capability when it offers…

the ability to stay young, hit refresh, future proof or re-imagine your North Star (purpose, ambitions, value, culture), strategy, and leadership ready for the fast-paced world,
by re-balancing existing or adding new investments (iterate, innovate, disrupt) in products, services, processes, markets, platforms, and business models
to drive future profitable growth and sustainable value in the customer, employee, and ecosystem, while taking care of the planet.

Depending on where you are with this, you’ll need to look at where to invest.

Let’s simplify innovation and categorize it into three types of innovation, using the machine metaphor:

Iterative innovation: It is oiling the current machine to make it more productive, more efficient, or effective. Your focus is to make a better version of what you have today.
Innovative innovation: It is adding a new part to the existing machine. Your focus is to create something new that wasn’t there before.
Disruptive innovation: It is about building a new machine. Your focus is to build something radically new that changes the rules of the game, that disrupts someone else or even yourself.

How much effort — time, resources, money, people — do I currently put into each of the 3 buckets?

Many companies will spend 90% (commercial) to 95% (public entities) in the iterative buckets and 5 to 10% in the innovative bucket.
In contrast, if you want to be transformative you will need 70, 20, and 10% in each of the respective buckets. High Tech companies even go beyond and spend around 50, 30, and 20% in each respective bucket.

A very useful exercise is to categorize your running and planned projects and resources over those three buckets and see what consumes the most resources. You’d be surprised about the outcomes. It will mirror how well you are balancing transforming and performing.

If you truly want to be transformative you will need 70, 20, and 10% in each of the respective buckets.
A CEO that is not spending 30 to 40% of his time on the innovative part is not really serious about it.
The same goes for the entire leadership team.

What are three things you hope attendees will take away from your session at MED Belgium?

I’ll speak about how to balance transforming and performing to build a soulful, highly energized, future-proof organization. I also want to help attendees see what’s happening on the outside, understand how to transform and perform as a person and as a business, and how to find the balance between innovation excellence and operational excellence. My keynote will be visually recorded on stage by Kristof, my business partner at Visual Senseformers and co-author of the new book. Looking forward to it.

*The answers have been edited for length and clarity.

January 9, 2023

Zana Busby: Chief Psychology Officers Add Value to Every Level of Business

Many global organizations have a Chief Psychology Officer – sometimes known as a Chief Psychologist or Chief Behavioral Officer – who uses applied psychology to help improve nearly all business processes. As the role continues to expand into the mainstream, we spoke to Zana Busby, Chief Psychologist at Retail Reflections, about what CPOs bring to the table and where they fit into the organizational structure.

Zana Busby is a Business Psychologist and Chief Psychologist at Retail Reflections. She specializes in consumer behavior, employee mental health and wellbeing, and executive coaching. Zana is also the founder of ZANA.B Psychological Studio – an integrated consultancy. She has been featured in various media platforms including BBC Radio.

Major companies like Google, Microsoft, and Uber have had some version of a Chief Psychology Officer. What value does a CPO add to an organization?

There are many benefits to organizations that have a Chief Psychology Officer. Firstly, these professionals can identify business goals and challenges that can be reached and resolved through the science of applied psychology. The most important value that a CPO brings is helping organizations get the best out of their people.

There are many principles of psychology that can be applied to the workplace that help manage the challenges and obstacles of the business world. Some pertinent areas include talent management, inclusion and diversity, and employee mental health and wellbeing, which are very important nowadays. There is also change management, employee engagement, leadership, as well as coaching and development. Basically, working with individuals and teams to raise awareness of their strengths, abilities, and values. For example, you can work with a CPO to discover how people react under stress and pressure and what are their individual decision styles and resilience characteristics. You can gain a deeper understanding of your employees. Of course, all of this has to be aligned with the organization’s vision and mission.

Psychologists are there to help your organization and people realize their full potential by applying psychological principles to influence workplace behavior.
– Zana Busby

Is a CPO more effective for customer experience or employee experience? Is it better suited for an internal- or external-looking portfolio?

I would say a CPO is effective for both. It would depend on their expertise and area of focus. For example, any consumer-facing business certainly needs a psychologist.

As consumers, we know that we are more driven by emotion rather than logic. Psychologists understand how emotions influence behavior and what triggers certain emotions. We can advise companies on the best possible ways to use that emotion in order to build strong customer relationships and provide a better customer experience at every touchpoint of the customer’s journey. A psychologist can help you better serve your customers by understanding how they make decisions based on internal and external psychological factors.

That is when it comes to customer experience. Also importantly, employees have certain expectations from employers such as providing a safe working environment, recognition, career development, work-life balance, personal wellbeing, and other benefits that inspire them to become fully engaged with work. Consulting with a psychologist about all these things can bring valuable insights and strategies that greatly enhance employee experience.

What are some characteristics of an effective CPO?

Whatever their area of specialty, they must inspire change and motivation. They must energize individuals and organizations to move forward and achieve success. So basically, you need a business psychologist who works in organizations and understands organizational cultures and workplace factors that may have an impact on the psychological health of employees. It is important to start by having a keen interest in human behavior. Great communication skills with active listening are also very important because they create strong connections and constructive relationships with clients and colleagues.

As a psychologist, you must have high levels of emotional intelligence and be prepared to understand the unique requirements of the organizations you work for. Often, it is a complex and personal assignment. Part of a CPO’s contribution as a psychologist is to leverage their experience about what is necessary, practical, realistic, and what is the best practice.

No matter what you specialize in, you have to be a good diagnostician. You have to make correct judgments about key issues in the organization and offer solutions. You cannot have a solution if you have a wrong diagnosis of the problem, which can happen if you do not understand the true nature of the problem.

I would say that there are many values, capabilities, and skills that business psychologists have, and they can specialize in different areas. For example, I specialize in employee mental health, consumer psychology, emotional intelligence, and building strong relationships between clients and organizations.

What industries would benefit most from a CPO and how?

I think every industry needs ongoing people and business development to remain relevant and successful in today’s competitive market. We can have sectors as diverse as hospitality, pharmaceuticals, health, financial services, and retail industry. The COVID-19 pandemic has brought so many challenges and stress. There have been financial, business, and human effects of the pandemic. Many businesses have unfortunately closed; some entered administration. One of the aspects that the CPO can do is support the mental health and well-being of staff.

The latest report from Retail Trust in the UK shows that employee mental health has deteriorated during the pandemic which led to many people suffering long-lasting mental health problems and symptoms of mental illness. Retail employees also suffered the lowest mental well-being of any employee group covered in the research. This is really serious. A Chief Psychology Officer in an organization can help tackle the stigma and increase the degree of transparency and open communication within an organization by creating a culture of openness where people feel psychologically safe. They can also enable employees to increase their coping skills through resources like stress management, mental health awareness, and other well-being training.

Nowadays, we know that looking after employees’ mental health, morale, and happiness has to be at the top of the agenda. Regardless of industry, employers have a responsibility to support the health and safety of employees including mental health and wellbeing.

In terms of employee well-being, how can a CPO work with CHROs and other HR leaders in optimizing employee experience?

CPOs can support HR leaders in creating and implementing agile solutions and long-term strategies for all HR challenges. We know that happy and engaged people are most profitable and productive. They sell more. There is less absenteeism, less presenteeism, and low turnover. One of the most important assets in any organization is its people. In order to create sustainable, high-performing organizations, HR and CPOs definitely need to observe high levels of collaboration.

For example, psychologists can help plan policies, and carry out screenings and training sessions. Additionally, there is often a power dynamic at play between line managers and HR professionals – CPOs can help manage these relationships and streamline interactions and collaborations as well. They can also work in partnership with HR on different associated issues like culture, change, and individual and team development. CPOs can also create and implement a holistic employee well-being and mental health strategy in collaboration with HR.

Together, they can develop a culture of psychological safety and a sense of belonging. We know that people try when they feel valued and safe in the workplace. This synergy between CPO and HR makes it easier to create and implement business- and people-focused interventions to optimize employee experience. I would say that such partnerships can systematically improve everything from performance to effectiveness of employee collaboration, engagement, and well-being.

What are some factors organizations must consider when looking to hire a CPO?

The best Chief Psychology Officers are psychologists at all stages. Their role is not restricted to advice. Instead, they should also be able to intervene and implement solutions, tools, and techniques. They should be able to deliver successful assignments.

You also need to look for people who are the best at what they do. They also need to have the right chemistry not just with the decision-maker but with the whole organization. They should be a professional whom you and the rest of your team feel you can confide in.

CPOs are there to help you navigate strategic shifts and challenges in your organization. So, they must be focused on inspiring positive changes in individuals and the organization.
– Zana Busby

What do you want attendees to take away from your Executive Insights session, “Behavioral Analysis: Why Do Retailers Need a Chief Psychology Officer?”

I would like attendees to have a clearer understanding of the role of a Chief Psychology Officer, what they can bring to the table, and how they can make organizational and individual success a reality. Psychology is critical to the workplace in that it creates a better culture. Healthy behaviors increase productivity and that increases the effectiveness of organizations. Business psychologists have the right tools, knowledge, and experience to help you get the best from people and make lives easier.

CPOs work with sophisticated human beings and communities in a complex organized commercial world and the main aim is to deliver pragmatic business benefits. Who can be a better fit than a CPO to help you gain a decisive competitive advantage?