25 Sep 2020
Podcast: Preparing for work-life post pandemic
Digital content team
Will working from home become the new normal? Behavioural finance expert Dan Crosby, futurist Clem Sunter, Investec’s Marc Kahn and Stephen Koseff and other experts share their insights into what the workplace will look like post pandemic.
Part 1: Preparing for work life post pandemic
Behavioural psychologist Dan Crosby, labour expert Andrew Levy, futurist Clem Sunter and Investec's head of People and Organisation Marc Kahn, discuss workplace dynamics post the crisis.
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Read the full transcript of the podcast
- N: Narrator
- AL: Andrew Levy – leading South African labour expert
- MK: Marc Kahn – Investec's global head of People and Organisation
- DC: Daniel Crosby – behavioural finance expert and author of The Behavioral Investor
- NT: Nicola Tager – head of Careers, Investec SA
- SK: Stephen Koseff – former Investec CEO
- CS: Clem Sunter – scenario planner
N: A time-traveller from last year landing in July 2020 might be forgiven for thinking she’d stumbled onto the set of a dystopian science fiction movie. And for good reason: not since the last world war has a single event altered our way of life so dramatically in such a short space of time.
From the onset of the Covid-19 crisis, some six months ago, Investec Focus has been documenting this seminal moment in a series of discussions with experts in a broad range of disciplines, all of which you can listen to in full in previous episodes of Investec Focus Radio.
In this series, we shine the spotlight on a specific question that runs through these discussions: will this surreal detour in human history lead to lasting changes in the way we live and work, how we think about money, or even the dynamics of global trade and the political economy?
Our focus in this first episode is the future of work.
For many of us, the most immediate impact of the Covid-19 pandemic is the sudden shift from office to home, interacting with others in a digitally mediated, virtual space. We’ve effectively been enrolled in a crash course in digital literacy. And this vast global experiment seems to have demonstrated that many kinds of work can be done effectively without requiring teams to be in the same physical space. This has far-reaching implications for how businesses operate.
Andrew Levy: "Work can be done from almost anywhere"
AL: I’m Andrew Levy and I’m the senior partner at Andrew Levy Employment and we are a consultancy which specialises in labour relations, labour law and labour market analysis, so we are simple labour people that’s what we do.
N: As a simple labour person, Andrew had a few simple yet weighty observations about what Covid-19 might mean for the workplace of the future.
AL: I think that the traditional model of the worker who comes and sits at his desk from 9-5 and ultimately retires with a thinly plated gold watch from his employer is certainly going to change because employers are going to realise that they don’t need to see their workers every day.
That when they do need to meet with them they can meet with them via electronic media which normally leads to much more focused, much quicker and less time-wasting in terms of meetings and this means that work can be done from almost anywhere for knowledge workers and people like that.
Marc Kahn: "WFH is very positive for diversity and inclusion"
N: For Investec's global head of People and Organisation Development, Dr Marc Kahn, the concept of flexible working is one which he's long espoused. Marc pointed out that by compelling us to work remotely, the lockdown has effectively forced us to question traditional assumptions about how work ought to be done.
MK: Flexible working will be so much easier and you can see that the infrastructure for it, the mindset for it, the ability to work from home, the ability to accommodate one’s familial responsibilities with one's work responsibilities and balance those are going to be easier.
It’s creating a much greater integration between our home lives and our work lives. So, from a diversity and inclusion point of view I think it’s very positive for the world.
Daniel Crosby: "The future will probably look more like the past than we think now"
N: But before you get too attached to your new-found habit of attending every meeting in your comfiest pair of tracksuit bottoms, it’s worth reflecting on the notion that some organisations are more conservative than others. We should also consider that our brains are programmed to extrapolate forward from our current circumstances.
This point was well-articulated by Dr Dan Crosby, behavioural finance expert and author of the New York Times best-selling book, The Behavioral Investor. In our June 4th episode on Focus Talks Radio, Dan spoke of a peculiar psychological trait…
DC: It's a bias in psychology, known as durability bias, which is the human tendency to project the present moment out into the future indefinitely and to think that the future will look a lot like the present.
So what you have right now is a lot of think pieces and a lot of articles and a lot of prognostications saying you know, the realities that we're currently experiencing like work from home and things like this will persist at their same levels into the future indefinitely. I don't think that's the case.
I think the world will be forever changed by Covid-19 much the same way that air travel was perhaps changed by 9/11 and associated events, but what I don't think is that it will persist at the level or to the degree to which people think now.
The future will probably look more like the past than we think now, so I do think it will change but I think it will change less than most people think today given how immersed we are in this particular situation.
Andrew Levy: "Issues around personal freedoms, privacy and electronic surveillance will arise in the workplace"
N: So, while the pendulum may indeed swing back towards pre-Covid norms, Dan concedes that the world of work will indeed differ from the one we left behind in our open plan offices. A recent Conference Board survey in the US reported that over three quarters of American HR managers said that they expect significantly more employees to work from home for at least three days a week, even after a vaccine for Covid-19 has been found.
And this evolution in the way that teams operate will likely also see a change in the way we measure employee value.
It should be fairly obvious by now that time spent in the office is an outmoded performance metric, particularly as we see individuals and teams delivering results regardless of their location.
But looking ahead to employees working happily and effectively from coffee shops and beach kiosks, we should not ignore the contrasting spectre of new surveillance technologies and the possibility of a more Orwellian future. Here’s Andrew Levy on the darker implications of remote work…
AL: What this of course is going to mean is that we are going to have to find ways to ensure that we can monitor both output and performance in terms of a quality standard and what are the numbers the productivity of workers who are no longer under your immediate supervision.
And I’ve no doubt in point of fact that we are going to find electronic means of monitoring which are much more invasive, much more effective than the boss occasionally casting his eyeball over acres of workers.
There are going to be obvious issues which will be raised in terms of personal freedoms and privacy and electronic surveillance which is going to be quite oppressive in many respects.
Nicola Tager: "A different leadership style is required for a WFH environment"
N: So, is 2024 likely to look like Orwell’s 1984? It’s a plausible scenario, at least in cases where employers are unwilling to depart from top-down control structures. But it’s by no means inevitable. Investec’s Head of Careers, Nicola Tager, believes that bringing the best out of people under remote working conditions – at least in her own organisation – requires a more fluid working environment, and a more human approach. This in stark contrast to the more mechanistic, algorithm-led approach that some organisations may choose to adopt.
NT: I think it is requiring a different leadership style than we naturally have always seen which has been around driving this high level of performance, high level of activity and efficiency, to a far softer approach, at times around really understanding the context that people are finding themselves within and allowing us a lot of patience and a lot of empathy from the leaders in the organisation.
And some are doing it exceptionally well and at other times, we are seeing leaders battle. The leaders that like a lot of control or leadership style that likes to micro-manage I think they really battling with understanding what true value frames really means during this time as well.
Andrew Levy: "A rethink is required on how we assess and reward performance"
N: So, we’re going to need to think differently not only about how we measure the value of work, but also how we reward it. And along with new ways of compensating workers, companies will undoubtedly be reviewing another significant overhead: the rent. Here's Andrew Levy again.
AL: We are going to have to rethink on an evolutionary basis the way in which we not only assess performance but the way in which we reward performance. So, I think we are probably going to become far more output based in terms of determining wages.
But what it does suggest to me too is that employers will certainly find it easier to get what they pay for, they will also find of course that they don’t need such large premises any longer, they don’t need to pay rent so much.
Stephen Koseff: "We won't necessarily need less office space"
N: With companies waking up to the fact that employees no longer need to be in an office all day, one naturally wonders about the future of commercial real estate, particularly as companies seek to cut costs in the wake of the lockdown.
Investec’s former CEO Stephen Koseff had an interesting take on this: we might well be seeing fewer people in the office, but social distancing is likely to be around for some time, and this has countervailing implications for office space requirements.
SK: A lot of firms were already going in that kind of direction where not everyone has their desk, you use neighbourhoods or what we call hot-desking and so we use a lot less space but with social distancing we are going to have to have more space you can't cram people into 8 square metres.
There will be a lot of people who say they don't need such big offices and then there will also be people who'll say we don't need such big offices but we need more space per head so we end up somewhere where we were before.
Daniel Crosby: "A lot gets accomplished face-to-face"
N: So perhaps it’s not all doom and gloom for the commercial real estate sector. The durability bias raises its head here, too.
DC: I think that this durability bias applies to commercial real estate. Right now, commercial real estate market is wrecked because the consensus opinion is that well, everyone's just going to work from home, everyone's just going to Zoom call for the rest of eternity, I think that's overstated.
N: This is Dan Crosby again.
DC: Now have we also discovered that many people work perfectly well from home. So, I think it will change the office landscape, but I doubt that it will change it to the degree that we now think that it will.
Human beings are social creatures there is a lot that gets accomplished face-to-face, elbow-to-elbow that is hard to convey over a screen. And so, I think that it will be impacted no doubt, but I imagine that the impact will be less than we think it is today.
Andrew Levy: "Covid will accelerate trend towards getting labour input from anywhere around the globe"
N: But it’s not just about whether our current workforce will return to the office or stay at home.
AL: Covid more than anything else is going to fuel or accelerate the rate of outsourcing of working from home, of getting labour inputs from anywhere around the globe.
Nicola Tager: "Our definition of capacity will be changed forever"
N: That was Andrew Levy. Investec’s Nicola Tager picked up on this too, adding that in addition to expanding the pool of prospects when it comes to hiring, the possibility of remote work also challenges traditional ways of thinking about jobs and vacancies.
NT: So, we’ve always thought of the job market in a very local way and based on the fact that we now understand how a remote organisation can operate I think we will be able to hire people across the world. So, the spaces that you will look for skills will be totally different.
And the second thing in the recruitment front that I think will be changed forever is our definition of capacity. When you think about human resources and the capacity it brings to organisations, we think in a very linear way around recruiting permanent individuals and permanent jobs.
And I think this will force us to leapfrog all of that research that has been happening and to really think in a way that we understand our own internal capability we can match them to pieces of work.
Marc Kahn: "Covid will accelerate the trajectory of the gig economy trend"
N: Which of course brings to mind the much blogged-about shift to a so-called “gig economy” – a trend towards short-term, on-demand work that was taking hold even before the Covid crisis.
But gig workers have been among the hardest hit by the Coronavirus pandemic, as most didn’t have the safety nets of unemployment benefits, health insurance or sick leave.
We asked Marc Kahn whether Covid could indeed have the effect of deterring rather than accelerating the trend as more workers seek the safety of permanent employment.
MK: We were on track for the gig economy to disrupt the way we contract people for work anyway. The trajectory in the US was to 20 to 25 percent by the mid 2020's.
Now all that Covid is going to do is accelerate that trajectory because it’s going to be these layoffs around the world because you are already seeing unemployment moving, and it’s going to just kick up. And what are these people going to do? They are going to go and be sole proprietors, they are going to sell their labour in gig ways. Companies are going to be reticent to re-employ quickly.
So, the boundaries between, what is a company inside, and what is a company outside, in terms of its people are already changing and now Covid accelerates it.
We are busy with an internal gig strategy which is that even inside the company you can work in four different areas, not just one. So, you put that all together the boundary system for the future is absolutely permeable. And to me that's really a fascinating kind of thing I think about.
Andrew Levy: "Employers are notoriously loathe to re-hire"
N: While the gig economy might be a boon for many who prefer more flexible work arrangements, it also brings with it the more sobering prospect of a shrinking market for full-time labour as companies look to limit their overheads.
AL: I think one of the things that follows from this is that employers will learn that they can run their businesses on a much leaner labour force and employers are notoriously loathe to re-hire if they can avoid it and because they are running on some cases on greatly reduced numbers of people and getting by is going to dampen down demand for labour.
Clem Sunter: "AI will reduce the density of our workforces"
N: While the prospect of increased outsourcing and reduced demand for full-time corporate jobs may look terrifying to some, renowned scenario planner Clem Sunter is more sanguine. Sunter spent most of his working life at Anglo American Corporation, one of the world’s largest employers in the labour-intensive mining sector.
But with A.I. and digital automation displacing jobs in this and similar industries, Mr Sunter sees a new generation of professionals realising that the future belongs not to corporate employees, but rather to entrepreneurs.
CS: The industry I worked in, the mining industry. We have 600,000 people in the gold mines, you know, we had these huge, huge industries, but unfortunately the world of work has changed, we have artificial intelligence, robots, and of course now with the Coronavirus we're going to have social distancing and lots of other things to try and reduce the density of our workforces.
So, with, where are people going to be employed and to me it's in a medium-sized and small business. It's going to be in innovation and it's why Americans, before the pandemic struck, had an unemployment rate roundabout, three and a half percent whereas Europe was sitting at 6 to 10% depending on the country and it's all to do with the fact that America has been a much more resilient country. It's also younger.
Clem Sunter: "The major contributor to employment in Africa will be entrepreneurs"
N: On his home continent of Africa, Mr Sunter had this to say, and one can easily extrapolate the insight to emerging markets in general.
CS: Africa is a very young continent. And so, what's going to save Africa is innovation and the growth of medium-sized and small business. And yes, you will still need the large businesses. You'll still need the infrastructure, the electricity, and other things, but the major contributor to employment will be entrepreneurs.
N: So, as we emerge from our homes to occupy public workspaces once more, will we perhaps be a little more confident in our own resourcefulness?
Could it be that the months of holding down jobs and running business while also doing the cooking and cleaning and educating our children has left us that much more resilient?
Our time traveller might notice people going about their business with a heightened trust in the judgement of their peers and employees, and a willingness to venture down new and unexplored paths.
Perhaps we may be about to witness a new Cambrian age of entrepreneurship and innovation?
Thank you for listening. If you enjoyed this podcast, please take a moment to rate us and to subscribe to Investec Focus Radio wherever you get your podcasts. And look out for part two of our series “Preparing for a post-Covid world” where we explore how the crisis is changing the investment landscape.
Listen to or watch the full individual webcasts
From the onset of the Coronavirus crisis, Investec Focus has been documenting this seminal moment in a series of discussions with experts in a broad range of disciplines, all of which you can watch or listen to in full:
- Andrew Levy: SA’s Covid-19 crisis: The jobs toll
- Marc Kahn: The Impact of Covid-19 on the world of work
- Daniel Crosby: Investing rules for uncertain times
- Nicola Tager: The Impact of Covid-19 on the world of work
- Stephen Koseff: A health crisis, a business challenge
- Clem Sunter: The road to economic recovery - camel’s straw to tightrope
Listen to more episodes in this series
Enjoyed this podcast? There are three other episodes in our "Preparing for a post-pandemic future" series that you can listen to.
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