Why your people don’t give a 💩 anymore
3Ps
As an old school HR professional, I was raised by the “3Ps importance” handbook. The 3Ps — People, Products and Profits — form an unbreakable bond that propels an organization towards success. Placing People at the core, nurturing a culture of innovation and excellence, while focusing on long-term sustainability rather than short-term gains are critical aspects of this approach.
P + P + P = S
Where: P represents each of the three components: People, Products, and Profits. S represents the overall success of the organization.
But somehow, along the way, it feels like we are disturbing the equation and entering an era where people are being subtracted from the traditional 3Ps. One has to ask, are PEOPLE the ones not giving 💩 anymore, or are they being subtracted by companies? And what happens when we subtract the third P? Can those 2Ps stand alone? Do we have a new mathematical equation? How does that impact the last remaining two? Will we continue to lose one by one?
3 Ps = ( P + P ) − P
The whole mathematical equation has been running through my head for a few weeks now, as I observe different companies in recent years and read about trends surrounding the worldwide decline in engagement.
Not only does Gallup [link] state that only 13% of employees in Europe are “engaged” in their work, but I also see a brutal decrease in the Employee Net Promoter Score (eNPS) surveys — reflecting a lack of trust in leadership, strategy, and lack of engagement — in companies that were once iconic brands for People Operators. These companies were once exemplars of how to build a successful organisation, where everyone is an equal stakeholder, a culture co-founder, and acts as if it’s their own company.
Glassdoor research states the same, especially for the employers who undertook layoffs in 2023. They have seen sharp drops in employee satisfaction and engagement, and the scores have been pushed down on Glassdoor. The HR team’s target is now to get a score above 3, and they are flagging negative reviews for removal while encouraging staff to post 5-star reviews to balance out the negative feedback. Gergely wrote a whole article about this, which you can find here.
Very curious.
I couldn’t get this topic out of my mind and decided to reach out my friend, an amazingly impressive professional who focuses on engagement in companies, David Dvorak, who was eager to lend his expertise and write a whole article on this topic. 🙏
The equation done wrong: When the Ps Don’t Add Up
With David, we've observed numerous startups and tech companies in the past few years. Startups and VCs riding the wave of an inflated economic bubble, then those caught in the fallout of a burst bubble, navigating through the COVID leadership, grappling with back-to-office policies, and responding to crises from the war in Ukraine to economic recession, responding to responses to the recession. Have we not only burned bridges but also burned out ourselves and many of our P’s? Yet, amidst the ashes, there’s always something to learn and mistakes to avoid. After all, as my dear old friend once said, a mistake repeated isn’t a mistake at all. It’s a choice. 🤓 😂
So finally, what are the most common Seven sins that create disengaged employees who don’t give a 💩 and make you lose profit? And why and how is this your fault, too?
The Seven Sins
1️⃣ The cutting-edge “Hire fast — fire fast” approach.
What we mean by that is the so-called innovative approach to hiring that subconsciously avoids hiring strategy, projections, and organisational planning. You first hire the person who seems capable of doing the job, even if you may not need this job or don’t quite know what the job is yet, but they are talented, perhaps with a solid background, education, and reputation, so let’s go, let’s hire them. We can always fire them as fast. *Especially if the contract won’t be signed in France or the Netherlands. We need to move fast. We are a startup. We need to ship no matter what. Hiring is not our product, and it cannot slow us down. Long thinking and taking a step back will kill us. Of course, like any approach, this one, too, has some potential drawbacks. I myself quite liked this approach. It felt productive and effective, with no fluff involved. But as with anything impulsive, impulsive hiring, often followed by quick dismissals during organisational changes, makes employees feel a sense of insecurity, creates loads of anxiety, and diminishes their commitment to the company. Folks hesitate to invest emotionally and professionally. It often creates a negative impact on morale and toxic energy in teams.
2️⃣ The broken record of layoffs.
The recent waves of layoffs, even though they are obviously driven by economic downturns and cost-cutting measures, also contribute to disengaged and worried employees who will turn away at the first opportunity. If you are following the market, you can see that most companies are repeatedly making the same mistake over and over again — laying off employees and recently hiding it behind not meeting performance expectations. If you are not following the market but are in recruitment, you may notice receiving new and new spreadsheets with new and laid-off employees looking for a new job. However, the fear of yet another future layoff leads to a lack of commitment and impacts team dynamics, where employees face increased workloads and pressure that often lead to burnout. In recent years, I have personally struggled with what to do with these burned-out individuals who have been retained in companies because they are considered the ‘rock stars’ who need to stay. Also, if you communicate layoffs and, in the same week, introduce a new strategy, don’t expect to see enthusiastic faces ready to rock and roll at your next All Hands meeting, embracing the start of saving your employer brand. I heard some founders are trying to awkwardly cheer up the remaining employees, and it just feels so fake. And soon, you can expect your Glassdoor to become the famous wall of shame.
This Glassdoor economic research actually kickstarted my whole thinking-it’s connected to how those layoffs I’ve been talking about all the time affect employee satisfaction, trust, and engagement. So, they do affect your Glassdoor wall of shame.
Surprisingly, these effects are still ongoing even many months after the layoffs took place. Glassdoor ratings continue to stagnate, if not deteriorate, even up to 180 days after the layoffs in 2022 and 2023.
3️⃣ Those freaking misleading war analogies.
In recent years, you’ll likely encounter the word ‘war’ more frequently than ever before, not only in the news. The economic crisis and widespread layoffs have led the technology industry to borrow this metaphor for business management as well. You wake up to advertisements inviting you to new training sessions on ‘Effective Wartime Leadership.’ And in the evening all-company meetings, the war narrative resounds: ‘Colleagues, realise that in the year 2024, we are at war. This company is not for the faint-hearted. This company is not for those who are afraid to work. This year is not for people who don’t want to sacrifice anything.’ Senior executives use military metaphors to evoke assumed authority, unfortunately at the expense of losing trust and reducing work morale. For many employees in the technology sector, using such a narrative is an aggressive change that invokes disgust in them.
4️⃣ The unspoken strategy.
Most of the consulting companies these days are focusing on helping CEOs with executive presence and how to communicate The Strategy. And I think they focus on a real problem here. In this regard, I really love the book ‘Good Strategy Bad Strategy by Richard Rumelt,’ but to be honest, I have no example of it being done right, as most strategies simply do not follow the rules of being a strategy. Most companies don’t even realize this, as they lack self-reflection until a consultant recommends reading ‘Good Strategy, Bad Strategy.’ Then, they realize they don’t have a strategy, but now they know about it, and it makes them feel 💩. So I was now considering, on a scale, what is worse for trust in leadership and the engagement of the P’s — the unspoken strategy or receiving too many mixed messages from leadership in the uncertain times that lead to confusion — and I cannot decide. What would you say?
5️⃣ Transparency turns into a buzzword.
Paradoxically, transparency would likely top the list of the 10 MOST COMMON COMPANY VALUES. It’s also highly likely that “TRANSPARENCY” is your LED light sign decorating your office wall, too.
But sadly, in most eNPS surveys, transparency receives very low ratings. You can think of recent events, such as worldwide layoffs, where the value of transparency could be exhibited to its fullest potential, yet most employees received little to no feedback. You probably saw the TikTok video of the Cloudflare employee getting laid off, which is a great example of how companies are handling it and serves as a masterclass of what not to do. Poor communication, not only around layoffs or the company’s future plan after such events, contribute to a lack of transparency and understanding and are deepening distrust.
6️⃣ First-time visionaries and their junior leadership.
Despite how immensely impressive the 30 under 30 founders may be, it’s quite common for them to struggle to provide a clear and confident vision for the company and manage employees, especially with critical processes such as starting new businesses, selling, hiring, compensating, and firing. I’ll talk later more about how VCs often become these founders’ adoptive parents, but they may lack the context and insights to apply to every single portfolio company. This uncertainty when it comes to first-time founders is totally human but often creates doubt among employees about the company’s direction and future prospects. Just in the past few months, I have worked on several CEO searches, and it’s common for me to work on searches replacing ‘first-time founder’ with more senior CEOs who can further advance the management of organisations.
7️⃣ VC’s little ducklings
Have you ever noticed how VCs call a portfolio company ‘my company’ or a CEO ‘my CEO’? It hints at a hierarchy where VCs are seen as the ‘Mum & Daddy,’ and founders are expected to listen like children. This often leads less experienced founders to focus on VC advice over the insights of all the three Ps. What happens then is: that leaders blindly follow VC instructions without thinking, leading to inconsistent decisions. This confusion can damage trust and definitely hurt how engaged employees are. Here comes my favourite example of unpopular layoffs again. Many layoffs started as a chain reaction prompted by VCs. to manage invested money more effectively. Although CEOs may manage to let go of X% of people — impressing investors that they are willing to save costs and increase the value of stock for them — the rest of the company’s employees will need a large amount of context for why you made that decision, and impressing the investor won’t be the strongest argument. Especially when the RIFs became so repetitive, it didn’t help rebuild trust in company leadership. Remember that Glassdoor research from a few lines above? Funny (or not so much?) that just two years ago, in venture capital circles, success in raising more money was measured by how quickly a company could grow its employees, which is arguably an inefficient metric for the healthy growth of a company. However, companies and investors quickly realised that, when the first economic downturn in the cycle hit, they began practising layoffs to fix metrics by firing employees and showcasing to investors that they were capable of doing so.
Why do these seven sins make people miserable, and what does the research suggest?
Even after familiarizing themselves with the seven deadly sins from the previous paragraph, many corporate leaders are far from understanding why their top Ps stars are so miserable at work. After all, we have modern offices, various benefits and bonuses, and a great company culture. We are at the age where most “modern” and progressive companies offer flexibility, financial stability and career progression. I can take my dog to the office, stop by the doctor with my child any time I please and join meetings with my boss literally from anywhere as long as I have my phone and stable internet connection.
Yet we are miserable at work.
At least that’s what the data suggest. Lowest engagement numbers in a decade, “quiet” quitting lurking around the most advanced markets, companies promoting psychological help to its employees as a benefit (I mean, how ironic), and going in the office feels like a new form of assembly line.
There are typically three major signs that make people miserable at their jobs.
Maybe it's time to take a step back and get back right with the essentials. I am sure you can see the connection with every single one of the sins, having various impacts embedded in the three major signs that employee get miserable at their roles. You might recognise the work of Patrick Lencioni, who I think is a spot-on author regarding Employee engagement. Patrick suggests there are three signs to tell that your job is dreadful and miserable:
Anonymity — Irrelevance — Immeasurement.
Anonymity
To get any type of attachment to your job and the people you work with, you need to feel recognised. As easy as it sounds, it’s often the lack of recognition we see in today’s workplace that contributes to the feeling of anonymity. If my boss has zero to no idea about who I am outside of work, how many children I have or what my wife’s name is, then it’s likely that I will feel alone and detached from my team or workplace. Humans are social animals; we need to foster relationships, emotional interactions and a sense of belonging. If I am to spend 8–12 hours a day working for a company larger than me and my life, I need to feel I am seen and heard. How to promote that? Start with genuine care. You know the old saying, “Lead by example”. Ask about your people. Ask them about their day, weekend hobbies, and whatever you find interesting to know about them. I don’t mean to cross a To-do list of daily questions: “How are you?”. I mean genuine interest and connection. If you are a people manager, treat your team as people. And no, we don’t need to be “family”. But we spend almost as much time together as we spend with families. It’s worth cultivating.
If they are unknown, people cannot be fulfilled and happy at their job.
Irrelevance
Have you ever wondered why successful people, athletes or celebrities are still miserable in their lives? Chances are they, too, feel irrelevant and disconnected from their lives. One of the most important roles of a manager is responsibility to help his team make decisions about the job responsibilities. We must discuss and promote within our people why what they do is important and to whom this work matters. For someone, a “job well done” is a game changer and live saver. For someone, a “job well done” is the difference between having an awful day and life is good. To see meaning in what I do is a fundamental part of human nature. Typically, it’s good to start with two essential questions:
1. Who am I helping?
2. How am I helping?
If your managers don’t know the answers to these questions, chances are your people don’t know either.
Immesurement
Companies these days are obsessed with grandiose objectives and goals. I mean what’s the chance you have not heard about the OKRs system? We are filled with milestones, KPIs, results and metrics. But can we actually measure how people get better every day? Is it clear when I do a good job or when I stagnate? Immesurement refers to a lack of means of assessing progress or success at the job. I mean, look at the dreadful performance review systems we see in every other company. The quality of goals matches the quality of engagement. If my success at the company is subject to incompetent managerial decisions based on 💩tty goals, then I am miserable. Because it’s essentially saying no matter what I do, I cannot objectively tell If am improving or not. Too many times, we see managers and CEOs setting these huge macro objectives tied to revenue, expansion or growth.
But far too many of these goals are within the direct reach of employees, making the whole thing somewhat distant and unattainable. The key to engagement with employees is to make sure we measure and review only as far as the employee can influence its goals and objectives. That’s why salespeople tend to enjoy their job more than others. It’s clear to them what to focus on and how to know If they succeeded or not. Attainable and measurable goals create responsibility, a sense of purpose and most importantly, engagement.
If you measure people based on artificial goals, they will give you artificial results.
What exactly is engagement, and how do we understand its domain?
Employee engagement has become a hot topic for various reasons, but mainly because we finally get serious data that suggests an engaged workforce generates significantly higher profits. That’s what’s sexy for shareholders, and if done well, it can save a huge amount of money without needing to invest in new fancy tools or expensive consultants. To further prove my point,
“Organizations with higher than average levels of employee engagement realised 27% higher profits, 50% higher sales, 50% higher customer loyalty levels, and 38% above-average productivity.”
But what the hell is engagement in the first place?
Thinking about employee engagement, we are generally filled with different ideas and preconceptions of what it truly means. Generally speaking, an engaged employee is emotionally invested, motivated, and committed to their work and the organisation’s goals. Engaged employees go above and beyond fulfilling the basic job requirements. It’s those over and top performers we like to label at the end of every year-end performance circle. As exciting and straightforward as it sounds, the reality is far more complicated, and an engaged employee is not just someone with a strong will and motivation. An engaged employee could be any employee as long as several critical factors are supported and delivered from the company’s perspective.
Typically, when conducting employee engagement surveys to find out the state of employee engagement, we focus on a set of questions dispersed in 4 main areas focused on engagement.
The only war is the one with ignorance and incompetence…
We are not at war. In fact, we work for various companies trying to streamline, for example, e-commerce operations. Maybe it all makes no sense, and maybe we haven’t figured out how to sell our product at a time when the market is dramatically changing and publicly traded internet stocks have started losing 90 per cent of their value. But the rising tide (inflation) raises all boats equally, and now it’s just a market reset of sorts. Managing a company in tough times doesn’t need a common enemy or forcing employees to give up their basic human needs, such as the right to rest. The start-up scene and the enthusiasts who have become part of it simply think differently. What unites people in such companies is primarily their endless perseverance, belief in a strong mission, desire to learn, and hunger to create a product that will leave their own significant mark.
They are willing to give a piece of themselves to it, but in return, they want to experience adventure, fun, and the intense experience of doing the work of their lives. In exchange, there is a high risk that the company may not succeed. The very last thing they want to hear are abstract expressions of bloody battles for which they may not even be good enough.
Focusing on the basics of human interactions and needs is a good way to start. Bullying people with fake interests and vague visions is no longer working (I’m not sure it ever did). Want to find out what engages your people? Ask them. Chances are, there is more information inside your organisation than on the VC meetings. It’s only up to you if you are able to fix the main equations and bring back the P your company needs. There is no war, only incompetence and ignorance.
We believe in you. 🫡
About the angry authors
We promise, we’re not always this frustrated, but we’re always passionate.
David Dvorak, People development partner at Upgrow
Do you want to meet with David to discuss engagement and how to fix it? Save a date! 📆
👉🏼 👉🏼 March 7, 2024 at 15:00 CET — online [CZ only 🇨🇿] 👈🏼 👈🏼
Tereza Machackova, Talent advisor & headhunter
You can expect more or less reading from me in the upcoming days.
