COVID-19 has had an unprecedented impact on organizations globally. Organizations are realizing that living with restrictions on mobility and remote working are likely to become the new normal, instead of an aberration.
In 2015, Deloitte collaborated with MIT Sloan to conduct an in-depth study on digital organizations across the globe and tried to identify what differentiates them from traditional organizations. Digital organizations are generally found to be faster, more flexible and distributed, and have a different culture and mindset than traditional businesses. This study identified six cultural characteristics or "Digital DNA.” Based on these studies, we believe that organizations exhibiting the traits of a digitally mature organization have been able to respond to the disruption caused by COVID-19 pandemic more effectively.
The report titled ‘Delve deeper into changing organizational culture and mindset: Learnings from COVID-19”, by Deloitte India was written to test this hypotheses after interviewing C-suite members of 39 organizations to draw insights on the disruption COVID-19 crisis has brought in the workplace.
Has a digital mindset and culture affected business performance?
Around 57 percent of the organization surveyed saw a decline in their business performance as the demand for non-essential products and offering decreased.
As a result, many companies turned towards innovation to modify their offerings. Over 60 percent of companies shared instances where employees resolved customer-related issues in a non-traditional manner. Interestingly, 74 percent of the organizations also shared a similar sentiment for innovations in their internal processes. Common examples include repurposing resources, creating new products and exploring non-traditional ventures.
However, this would have been difficult to achieve without a strong culture. Organizations that embraced the right culture characteristics are seen to have generally experienced a certain vibrancy and energy across the board. About 70 percent of the organizations that are stated to be performing at a better or same level as pre-COVID, saw a high prevalence of five of the six cultural markers. The most prevalent markers observed were collaboration (observed in 100 percent respondents), customer centricity (observed in 88 percent respondents), and clear purpose (observed in 82 percent respondents).
Organizations also experienced a shift in mindset as the need to embrace culture of agility and experimentation set in. In the absences of guidelines, leaders were able to accelerate decision-making significantly with better response times. An overwhelming 85 percent of leaders agreed that they pushed their boundaries during the time of crisis.
It is important to note that companies did not make cultural shift overnight. All organizations saw the presence of one or more characteristic inherent in their organization. Companies that had a high prevalence typically found it easier to adapt to the COVID-19 situation. About 82 percent of the organizations which reported better or same level of performance stated that having strong cultural characters helped them perform better during the crisis.
How has leadership changed the game?
The crisis has created unprecedented circumstances for today’s leaders. Leaders were required to set direction amidst uncertainty and role model resilience. Their role in keeping their teams engaged and motivated has become more important than ever.
Frequent and varied communication has become a key instrument to energize and maintain positivity. About 69 percent of companies have seen teams “over communicating” to stay connected and build trust. Teams often saw their leaders starting calls with personal questions.
Secondly, compassionate leadership was sought out. About 72 percent of the organizations reported to have adopted a largely humane approach to deal with the crisis. This includes characteristic traits such as empathy, care and concerns for employees being strongly reflected.
Many leadership behaviors were accentuated, most importantly was their ability to grasp the complexity of the situation. About 69 percent of the HR leaders interviewed reported that agility in decision-making has helped the company survive. Effective leaders were able to quickly gather and devise strategies to address questions confronting them. They made the decision-making process simpler and a higher frequency of connection allowed quick decisions.
What does the future hold?
The focus for leaders and employers is to prepare for the new normal. Today, new normal includes driving agility; collaboration and innovation as ambiguity persists. A culture and leader mindset fostering such a directive is expected to be a key imperative for the C-suite.
In the report, over 50 percent of the organizations have reported towards skilling and capability development of employees. This includes equipping workers with future-ready skills. Around 46 percent of the organizations plan to relook at productivity norms and explore roles that can be taken up remotely on a regular basis. This includes jobs which require skills to work and lead in a virtual world.
Not only are companies seen looking at their workforce, but also the revamping of fundamental designs of different processes to facilitate in achieving agility and collaboration. This includes performance management, career management and employee engagement. Around 46 percent organizations want to set a new path forward based on data, benchmarks and human principles such as transparency, growth and collaboration.