Culture is determining which businesses will survive
COVID-19 is creating a pressure-cooker for organisational culture – putting it to the ultimate test, as one of the key determining factors as to whether a business will survive, or collapse, as a result of the pandemic.
Business leaders are being forced to lean on the true culture of their organisation and the engagement of their employees, as they try to navigate the unique challenges presented by COVID-19. A culture of trust, with everyone ‘pulling in the same direction’, may prove to be the ‘heartbeat’ for business survival, ahead of many other factors.
Arun Chauhan, founder and director, Tenet Compliance & Litigation, assesses the risks facing businesses and shows how proactive leaders can change their behaviours to mitigate the losses they stand to face.
The COVID-19 pressure cooker
It’s long-stated, and accepted, that organisations lose an average of 5% of their revenue to fraud. However, reducing this impact is not a fundamental priority for many. Today, that 5% - viewed by many leaders as simply ‘the cost of doing business’ – could be the critical difference that makes or breaks an organisation as cashflow tightens.
COVID-19 has ultimately diluted the impact of ‘command and control’ leadership styles. Many leaders have had to trust their employees to work remotely driven by their own motivation and initiative. As a result, workplace cultures are under strain and for some leaders, the lack of visibility of, and trust in, employees’ work and presenteeism is only adding to the pressures, and projecting a lack of trust.
Some employees may be facing pressure from two fronts: personal financial pressure, as well as increased pressure from their leaders to counter declining revenues or operational problems
Culture is the critical defence for businesses and leaders in mitigating the risk of a good employee turning to fraud. A strong organisational culture will make that shift unthinkable for many.
Some businesses are shining, with every employee working towards a clearly defined vision, in a high-trust and virtual environment. Others may face such pressures that working from home is viewed as an opportunity for self-betterment, at the employer’s cost.
The influence of leadership
As COVID-19 increases workplace pressures, leaders – either intentionally or unintentionally – can create a toxic culture. As a result, employees can begin to feel disconnected with that culture, feeling frustrated and under-valued. That disenchantment can lead to employees acting in a way which both invites risk into the business and is misaligned with their true morals. We are all susceptible to poor decision-making, particularly when feeling emotionally drained or under immense stress.
Leaders have a crucial part to play in recognising, and – where possible – reducing, the pressure their teams are under. Instead of pushing for targets to be reached at any cost, leaders should take the time to monitor the targets set and ensure they align with the teams’ capabilities. If you begin to tolerate small wrongdoings as a means to meeting unattainable targets, it can open the flood gates for worse behaviour and much larger losses in the long-term.
Leaders can create a positive workplace for their teams. Get that right and your business is more likely to survive in the long-term.
The above themes are explored in the results of a round table, and captured in Tenet’s white paper, Leading to Loss, which is available to download below