Organizations Encourage Risk-taking, Even in the Face of Workforce Shifts
AUGUST 25, 2020
This year has been an excellent test of everyone’s adaptability. In order to survive various calamities that arrived with the year 2020, organizations have had to quickly find new ways to work and meet changing market conditions.
Fostering this kind of adaptability, however, is no easy feat. It requires companies to invest in employee learning and encourage risk-taking.Take Netflix for example: The company began in 1997 as a mail-order DVD rental service. But as customers began consuming entertainment via personal devices or the internet, the business pivoted from physical DVDs to an online streaming service—and now a content creation company. This is a multi-threaded change that sparked a transformation in the film and entertainment industry and required a new set of skills from their employee population.
Business leaders today agree that encouraging employees to take chances—in a calculated, thoughtful manner—creates a company culture where teams are not only more likely to quickly react to change, butembrace it. But amid the challenging economic circumstances brought on by COVID-19, many organizations want to mitigate risks, with employee safety at the forefront of that risk mitigation effort, rather than ignore or actively search for opportunity.
Learning also plays an important role in creating an adaptable work culture. Employees who regularly push themselves outside their comfort zone through learning and developing new skills, or working on stretch projects, are more likely to cope with uncertain situations. When learning and curiosity is rewarded in a workplace, employees feel more encouraged to keep up with new trends, skills and processes.
Businesses—and by extension the individuals that make up those organizations—that encourage risk-taking and learning are themost adaptable. But in light of the current pandemic and its dramatic effects on the modern workplace, it’s worth asking: Are organizations still following this truism? And how has this crisis affected workplace cultures that historically valued risk-taking and learning? At Cornerstone, we have launched the Cornerstone People Research Lab to answer these questions and continuously have these conversations as we evolve.
The Preliminary—But Promising—Research Findings
Cornerstone People Research Lab has launched a multi-year research project with the consulting and education firm Leapgen. Among other topics, this survey of 1,000 workers will study changes in how and when employees learn at work. It will measure worker sentiment towards workplace learning and how often they are encouraged to take risks—accounting for conditions from before and after this crisis. We are now in our second sample of the research.
Originally, the project hypothesized a decrease in risk-taking and learning due to the pandemic. And though it’s still uncertain what the coming months and year will bring, the research has so far revealed the opposite to be true: Despite enormous amounts of change, risk-taking is still being encouraged and learning is still important to employees.
Despite The Crisis, Risk-taking Isn’t Off the Table
A 2012 study on the 2008 economic recession suggests that organizations’ willingness to innovate during a recession decreased significantly whereas before the downturn, they were extremely entrepreneurial. Many predict the same to be true for the COVID-19 crisis, which has alreadynegatively impacted the global economy.
However, our current findings do not align with these assumptions: In 2019, when this research project began, we asked employees whether or not they felt that their company encourages risk-taking and if they felt comfortable making mistakes. Over one-third (34.5%) of respondents agreed with this statement overall. Earlier this year, when the COVID-19 pandemic began, we asked this question again and, shockingly enough, found that this number had increased by 4%. And perhaps most interesting, it grew the most among respondents from small to medium-sized enterprises (SMEs).
Our survey also asked employees whether or not they felt their company allowed forcontrolled risk-taking, or making changes that have a lower risk of failure. From 2019 to 2020, there wasn’t a drastic change in these overall responses except for those coming from employees at large enterprises: According to our survey, companies with 5,000 or more employees feel more encouraged to take controlled risks in 2020 than they had last year.
This increase in risk-taking is less surprising when observingcompanies like Medtronic, a leading medical device manufacturer that shifted its business strategy to make ventilators during the COVID-19 pandemic. Airbnb, an online marketplace platform for vacation rentals,made a similar strategy shift. Faced by the sudden collapse in travel, the IPO-bound start-up now offers online events focused on cooking, meditation and other activities that users can join for a modest fee. Organizations still want employees to take risks—and are making sure they feel comfortable doing so—in order to find ways to innovate and adapt to the current, unprecedented situation.
Learning Is As Important As Ever
The negative effects of the COVID-19 crisis on the global economy have forced companies across industries to make budget cuts, compensation reductions and, in worst case scenarios, institute furloughs and lay-offs. Historically, when a company experiences a financial setback, the learning and development budget is one of the first to be reduced.
But according to our research’s findings, cutting back on L&D right now is a counterproductive decision for any company hoping to keep current whilst retaining & engaging their employees: In their 2019 and 2020 responses, employees regarded learning as one of the top four benefits that their company offers, alongside job security, competitive pay and attachment to an organization’s mission.
The research project is also looking into the top ways that employees prefer to learn. Thus far, we’ve found a majority (78%) prefer to learn through experiences while others want to learn in-person via a training facilitator (66%), self-guided online courses (59%), microlearning (58%) or through a coach or mentor (55%).
In breaking down these findings, we found that they support two notable claims, the first being a correlation between L&D investments and business success: Employees at high growth organizations, or companies that are growing faster than 10% per year, are the most satisfied with the learning resources available through their employer. We also found that coaching might be the superior learning method for certain high-tech companies, since 68% of these respondents stated that they prefer learning from coaches (compared to 55% average across all industries).
Learning is an integral part of any organization. Without it, calculated, effective risk-taking cannot occur. Employees must be prepared with the skills necessary for making thoughtful decisions and taking leveled chances—especially when the present is unprecedented and the future is uncertain. We recently had a customer tell us that "eLearning has become a business continuity requirement"—and we agree.
As business theorist Arie de Geus once said, "the ability to learn faster than your competitors may be the only sustainable competitive advantage." Constant learning not only produces smarter companies and employees in the short-term, but it may be the key to creating a more sustainable economic climate for everyone, despite present and future disruptions.
For more resources on how to create a culture of adaptability and innovation at your company, now and into the future, click here.
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