What's next for employer-employee relationships

Let’s look at these scenarios in more detail.

Work as fashion

In this scenario, the worker-employer relationship is reactive. Employers are in constant motion as they chase worker sentiments, competitor actions, and marketplace dynamics, similar to how fashion brands introduce new clothing lines. There is little, if any, connection to a sustainable workforce strategy. Even the employer’s stance on societal issues (typically focused on the hot topic of the day) is used primarily as a way to attract, retain, and motivate workers. This scenario could be the dominant one for 2021 and 2022, especially in light of the hotly debated issue of the return to the workplace.

Three potential organizational responses:

• Instinctive: Respond in the moment to workers’ expressed needs (often via the loudest or most recent voices).
• Survive: Be thoughtful, action-oriented, and, most importantly, selective in responding based on understanding and addressing workers’ underlying needs, not only the loudest voices.
• Thrive: Build a sustainable and differentiated relationship built around a core set of ideals that are important to both workers and the employer. A sustainable relationship is one that lasts through shifts in worker sentiment and marketplace conditions, evolving with the times, but always tying back to fundamentally constant values. Think “style setter,” not “fashion follower.”

War between talent

Here, the worker-employer relationship is impersonal. Workers compete for limited jobs due to an oversupply of talent, and employers view workers as commodities: almost interchangeable and easily replaceable. Workers are more concerned with competing with each other for jobs than with the quality of their relationship with their employer. Because employers are investing less in employee development and reskilling, those employees who can afford to invest in their own development will be in a better position to win jobs and command higher compensation, fueling a widening social divide as well.

Three potential organizational responses:

• Instinctive: Commoditize the workforce to minimize costs and maximize output, focusing on “resources” rather than “human.” This approach may be based on stable marketplace conditions, business needs, and talent supply, which is not what the past has shown us and not what the future holds.
• Survive: Selectively invest in the workforce in the areas important for your organization versus succumbing to the temptation to commoditize workers and compete on cost. While cost management is important, an employer can pull ahead of others through careful, strategic workforce investment.
• Thrive: Recognize that workers deliver more value when they are respected and invested in. Even though this scenario is based on excess labor supply, investing in workers across the board produces disproportionately better results, particularly if that investment includes reskilling, which better prepares employers for the future as well.

Work is work

This worker-employer relationship is professional. Workers and employers depend on each other for work-related needs, while organizational responsibility and personal and social fulfillment are viewed as largely separate domains. People care about work because it gives them the means to pursue their “real” priorities and activities that give them purpose and meaning. Employers increasingly communicate guardrails about what is and is not acceptable work behavior.

Three potential organizational responses:

• Instinctive: Assume the relationship doesn’t need attention because it’s purely professional; workers are there to work, so building connection or providing purpose and meaning in the work is not necessary.
• Survive: Help workers separate work from their personal lives while still cultivating their sense of comfort (and thus belonging) by creating an inclusive environment where workers feel respected and treated fairly.
• Thrive: Rearchitect work in ways that motivate and engage workers based on the merits of the work, encouraging workers to feel as invested in their work as they are in their personal lives.

Purpose unleashed

The worker-employer relationship is communal in this scenario. Purpose is the dominant force driving the relationship and is critical to the employment brand. This centrality of purpose pushes organizations from shareholder capitalism toward stakeholder capitalism, where social and business concerns, purpose, and profit are equally important. Organizations may take stances on issues they otherwise may have stayed silent about in response to growing demands from workers and customers.

Three potential organizational responses:

• Instinctive: Take a vocal and visible stance on social issues, and communicate purpose as a top priority. Not following up this stance with action and visible accomplishments may risk stakeholders viewing it as lip service. Some workers may feel pushed to the fringes, depending on the stance.
• Survive: Integrate purpose into business operations (operating model, governance structure, supply chains, marketing) and talent programs, making your commitment intentional and visible.
• Thrive: Cocreate purpose with the workforce, giving workers influence over what the organization stands for, what outcomes you want to achieve collectively, and the actions you take to achieve them.

You can’t choose the future, but you can choose your response

Which of these four scenarios is most likely? We asked the more than 3,900 participants in our recent Dbriefs webcast which scenario they believe will be most dominant in their organization, industry, or geography based on the signals they are perceiving today. Forty-one percent indicated “Work is work” as the dominant future, with “War between talent” as the second-highest option at 28% of responses.

No matter where you think your organization is headed, or the internal and external factors that may position your organization in one future versus another, we believe you should plan for them all. Adopting a thrive mindset is key to effectively navigating the relationship and strategically positioning your organization for success however the future unfolds.

Authors:

• Kraig Eaton, principal, Deloitte Consulting LLP
• Maren Hauptman, German Human Capital leader, Organization Transformation offering leader, Deloitte Consulting LLP
• Shannon Poynton, senior manager, Deloitte Consulting LLP