It may be a commonly-used adage, but it is certainly one worth repeating that uncertainty is bad for businesses. On the whole, business leaders are cautious by nature.
We are experiencing a long period of uncertainty – from the Scottish referendum in 2014, the lead-up to and result of the EU referendum – and are surely braced for more. The outcome of the US presidential election draws close and Brexit negotiations have only just begun.
Meanwhile, a potential second Scottish independence referendum looms in the background.
However, while tightening purse strings, putting big decisions on hold and battening down the hatches might be a preferred route to ensure survival in an environment over which they have little control, business leaders must also be acutely aware of their people; organisational uncertainty at the top breeds uncertainty throughout, which can manifest in a number of problems.
A reluctance to invest in recruitment, development and training, and staff incentives might be seen as a natural course, but business leaders have to be fully aware of the impact this has on their people.
While a business operates as a unit, it is made up of individuals. Individuals by their nature, react differently to uncertainty. Even during periods of stability, each person has their own concerns, ambitions and circumstances. Uncertainty exacerbates these and puts additional stress on people. Coupled with normal day-to-day pressures in the workplace this can manifest in unhappiness, increased absenteeism, drops in productivity and ultimately with the employee leaving the company.
So what can businesses do to help minimise the impact and shield their workers from elements not within their own control?
Clear communication from the top goes a long way to reassuring staff, helping minimise dissatisfaction and maintaining morale. Communicating long-term objectives and contingency planning can help preserve workforce stability. This is particularly pertinent in areas such as the financial sector, where the impact of global economic changes might mean organisations have to relocate. Even if a business has no plans for such major changes, letting staff know helps smooth the road ahead.
Second, make it as easy as possible to engage with senior management to ensure grievances and concerns are managed early. A clear open-door policy doesn’t cost much and staff appreciate two-way communication. This can be vital in terms of avoiding staff disputes and other problems associated with stress, all of which can be costly and time consuming for a business to resolve.
Finally, businesses need to examine whether stripping back optional extras really is the best decision to make. While in the short-term cutting back on employee incentives might save money and make the business financially more secure, the same can’t be said for the workforce. Retaining small incentives and staff rewards during uncertainty can help maintain morale and encourage the associated commercial benefits which come hand-in-hand.
As Scotland’s position in the UK, Europe and the global stage is realised, businesses will have to make tough decisions. While they can’t escape uncertainty, nor can their workforce, and it behoves senior management to take heed. Now more than ever, businesses have a responsibility to listen and to engage with their staff – there are clear moral and economic incentives to do this, and they don’t cost much.
Ann Frances Cooney is a senior associate in HBJ Gateley’s Employment team