Influence of Covid’19 on Corporate
Leadership Behavior towards Workforce Safety and Business Objectives
Dr. RAHUL. P,
Visiting Faculty,
Loyola College, Chennai-India
& Human Resource Professional
Abstract
The overview of the study is to
understand leadership behavior in handling pandemic and its reaction towards
workforce and in dealing with business objectives. Corporate leadership
behavior in handling catastrophe is an exceptional task. Literatures have been
discussed on various theories and styles of leadership that suit different
circumstances based on the operational environment. The primary data was
collected from Founders, CxO and Executive Leadership in the corporate sector
to ascertain the behavior of leader’s under different variable clusters which
embark employee safety, financial/economic decisions and business objectives.
The study revealed the corporate leadership has countered positively in
handling their workforce and business during pandemic-COVID19.
Keywords: Leadership, Behavior, Workforce,
Pandemic, COVID19, Catastrophe, Employee Safety
Introduction
September 11, 2001 terror attacks
drew global attention, for, the fatal attack was particularly damaging
multi-fold and the aftermath of it impacted the U.S as a whole. While help and
concentration flowed towards aid and victims, about 462 extended masses were
layoffs because of the attacks that displaced around 130,000 employees. The
unemployment rate inclined to a total of 5.0% which is significant. The attacks
caused an estimated overall economic loss to the city of $82.8-$94.8 billion
USD.
The Great
Recession in 2009 was another global economic downturn that devastated world
financial markets as well as the banking and real estate industries. In the
steep annual drop in jobs, i.e. 9 million globally, marked the highest yearly
job-loss total since 1945, the year in which World War II ended. Most
industrialized countries experienced economic slowdowns of varying severity but
few notable exceptions were China, India, and Indonesia. Many argue it is
leadership’s responsibility to handle crisis, especially in the public sector,
with potentially debilitating social and economic effects across the board from
welfare to education to security to the environment (CF Boin and Hart 2003;
Boin, 2005). Also, organizations and leadership are pursued to change ways in
business arrangements, rules getting realigned, standard operating procedures
and relationships with key stakeholders. Leadership is in a fix to do more with
less and of course, we now have COVID-19 creating a tumultuous atmosphere
globally calling for rapid measures of adaptation by both the governments as
well as the corporates, hand-in-hand.
Handling
unprecedented circumstances and complex situations are by-products of
leadership in an organization. Coronavirus-Pandemic-COVID 19 has brought the
entire human race to ascertain the nature of ‘leadership behavior’ at every
level one can encounter. It is imperative that leadership and its role have a
central part to play in handling the pandemic. Leadership behavior and attitude
has been put to test in many scenarios, like social, economical, emotional,
physical, mental and psychological front.
For business leadership, managing
the workforce and setting the expectation with the employees at these unusual
times like pandemic–COVID19 can be a strenuous task. It is like never before
that the entire human race has been pushed to stay put within four walls with
an indefinite timeline of the lockdown mostly across the globe. This pandemic
circumstance has pressed all sectors around the world to reorganize business
operations accordingly. In another perspective, one could also say this has
brought about space for creativity to provide solutions to complex problems in
a much simplified manner.
Should we be surprised at how IT
sectors have managed to move their entire business operations to remote in no
time? A study (conducted by Granter 2020) indicates that India ranks on top
with an overall 67% of its IT workforce working well equipped in managing
business using tools like artificial intelligence (AI) and machine learning
(ML) followed by USA and UK in second and third place. While business analysts,
stock market experts and economists were discussing the ‘doomsday’ Corona Virus
has brought us to, China, which is the epicenter of COVID19 outbreak embraced
nanotechnology and IOT (internet of things) for new product introduction (NPI)
in the their manufacturing units. With the usage of IOT and nanotech one can
access even the minuscule detail of an assembly line in a remote Chinese
factory, while ‘working from home’ in any part of the world.
Leadership behavior involves
handling each of a given situation and matures itself over a period of time. We
have seen many such leadership examples, both in public life as well as
business corporations. The role of a leadership is sought after especially for
guidance and to understand better handling of a challenging situation. The
effects of understanding organization culture, commitment of the organization,
leadership behavior and overall business performance are elements that go
together and have an equal role to play. These facets boom job satisfaction of
the workforce and also aid to the behavior at helm of affairs.
Changes take place every day in
business. Catastrophic times like pandemic-COVID19 are crucial phases during
which the leadership behavior of this decade has a lot more reason to be
studied and looked at up-close. In this context the current paper aims, 1) To
analyze leadership focus towards employee’s safety. 2) To check leadership
responsibility and foresight to meet business goals. 3) To estimate leadership
contribution in motivating employees during challenging times. 4) To understand
leadership commitment towards employees salary and bonus.
For the purpose of this study,
pandemic-COVID19 will be mentioned from a challenging time perspective and the
terms like employees and workforce will be used interchangeably.
Review
and Discussion around Literature
According to Yukl (2013),
“leadership is the process of influencing others to understand and agree about
what needs to be done and how it needs to be done, and the process of
facilitating individual and collective efforts to accomplish the shared objectives”.
The context of employee’s safety and wellness are now discussed like never
before. The idea of Work from Home (WFH) seems to serve a big leap of benefit
to both the employer and employee. While the cost of business operation is
getting optimized, it creates more room for the workforce to spend time on
things other than regular office tasks. Leadership across industries seems to
have a tough road ahead in keeping every stakeholder connected while at the
same time keeping the workforce motivated.
Leadership behavior is a
well-researched area. There are countless theories that describe leadership
behavior under different context, domain and state. The effect and influence
that leadership imparts on its organization, performance of the workforce and other
associated stakeholders is shaped by “behavior” (Yukl 2012). During the mid and
late 90’s there was an extensive research conducted around leadership behavior
(Fleishman 1953, 1957, 1973) (Blake 1964) (Likert 1961) (House 1971) (Misumi
1985) and also quite a few in the 2000’s (Overfield 2010) (Van Wart 2012) (Yukl
2013).
Leadership Behavior has a definite
impact on an organization’s culture. There are studies that relate leadership
behavior with culture (Huey Yiing, L 2009) (Leach 1976). In fact, organization
culture defines the very ethos of the workplace. Culture makes the role of the
workforce cater to the role of leadership especially in large corporations.
Visibility of culture is the discipline in an organizational context that goes
hand-in-hand with leadership behavior (Harrison 1991). But, of course, there
are situations in which even a highly cultured environment can drive itself
astray, during uncertain circumstances. In the context of a business leader,
the onus to behave more responsibly is felt, with increasing cultural diversity
in the workforce and with higher expectation to motivate and satisfy the
employees (Voegtlin 2012).
‘Personal Value’ has a direct impact
on leadership behavior and vice versa. They get altered with change in culture
that the leadership goes through and takes time to show divergence from earlier
culture factors. The effect of multifold culture with personal values has
certain guidance on the leadership behavior (Chang 2008). It also helps in
shaping the decision making part of the leadership.
Employee’s wellness is considered
supreme priority in the global market. Organizations today have taken more
interest in ensuring the well-being of their employees not only under
compulsions of the law but also out of self-interest. New age employees are more
vocal than ever on many digital social platforms plus they are also directly or
indirectly branding the organization positive or negative through
word-of-mouth. Taking more care than ever in managing the workforce’s
well-being becomes more important than ever. The performance of the employees
gets amplified based on the well-being that they are covered by their
organization. It shifts the employee’ focus from worry to work related
performance. There are many studies that have shown empirical evidence to the
fact employee’s well-being is linked with leadership behavior (Graen G 2010,
Harris KJ 2009, Arnold KA 2007, Hetland H 2007, Nielsen K 2012, Gregersen
2014).
During extreme calamities and
challenging times the world witnessed governments of the day taking measures of
providing sufficient direction to various business houses to take adequate
actions to safeguard the well-being of the employees. The leadership of the
corporate world is taxed with mammoth commitments of dealing with a failing
business economy and at the same time walking on a tight rope to balance the
well-being of their workforce. Leadership that acted swiftly on employee’s
well-being ensured work performance while retaining customer delight. A
positive and safe organization culture is essential with communication,
commitment and employee training for the fundamentals of safety leadership
across all sectors (Skeepers C.N. 2015).
Change certainly makes a lot of
noise around the system and in an organizational behavior context it can mean
and relate to motivational factors and happiness at work. At challenging times,
employee motivation can be tested due to the changes in business chores and its
related effects are indeed felt in the day to day work life. The role of
inspirational leadership has influence over the happiness of employees at work
(Vallina 2018). The role of transformational leadership style has seen
significant positive impact on the work behavior and morale of the employees
(BM Bass 1999). The motivation factor and turning employees towards innovative
work is felt higher under a transformational leadership style than under
laissez-faire leadership style (Gemeda, 2020).
With business growing multi fold and
expanding geographically the task of inspiring employees and keeping them
aligned to achieve business goals could get challenging. Leadership believes
the workforce come in close contact with each other through either socializing
or personal contact; however with teams getting widely spread and working
remotely in geographies, the emphasis is on inspirational leadership (Joshi
2009). In recent times organizations have become more complex with business
diversity and wider client base. The organizations’ complex situation has
compelled itself to adapt to dynamic leadership strategies. With an
institutionalized environment, new methods of reorganizing work without
obstructing the change behavior at micro and macro level of the organization is
critical for the leadership to establish. Patterns of successful leadership
behavior in an organization can be made common that could also transcend based
on contingency factors (Larsson 2010).
Emotional intelligence is another
quality that is paramount in leadership behavior. It is the ability to
understand the situation around the business system and take measures wisely in
human sense which also covers the employer attitude towards employees. In a
dynamic business ecosystem the role of emotional intelligence is like a
catalyst for better management and inspirational leadership (Chopra 2010). Leadership is not only about empathy towards
the diverse workforce during difficult times but also, it has been critically
viewed as it drives significant value in an organizational context
(Businessolver 2019). Leadership finds itself in a difficult spot when it has
to steer with no given clarity or lack of fixed points of direction. So, it
shows leaning toward making own-rules under such unstable times (Weick 1993).
While this may be true, virtuousness can be a simple way for leadership to
steer during times of change and uncertainty (Peterson and Seligman 2004).
Leadership in crisis handling is
highlighted especially when the crisis is largely distinctive. The leadership
behavior is looked up close unlike under normal circumstances. Crisis leadership
revolves around managing information, stakeholders, planning organization and
spring back order in business (DuBrin 2013). Swiftness in responding to crisis
is a pragmatic approach and is an admired behavior in a leader. A lot of crises
can be averted with effective communication and management. The behavior of a
leader around the frequency of communication with all stakeholders in an
organization will support in mitigating the damages arising from crisis
(Gilstrap 2015).
Leadership provides inspiration at
work. The organization staff, be it the frontline executives or board room
managers, are charged and decked-up to unleash their skills subject to the
behavior of a leader. The performance in delivery to client expectation and
matching the needs of a customer is complimented only with effectiveness of
leadership behavior. There are external factors that drive delivery of business
fulfillments and a substantial part of it comes with the standard of leadership
behavior (Hui 2010). Leadership behavior is assessed even during non-vocal
circumstances. Leadership that is non-verbal is a critical area. Emotions which
are not essentially communicated verbally are expressed using non-verbal
methods and they have their implications over the leadership behavior (Sullivan,
D. G. 1993).
Charismatic nature in leadership is
yet another critical quality that denotes behavior aspects by the
organizational workforce. Charisma is difficult to manifest but being so is not
too vital to be an effective leader (Cutler 2010). Leadership behavior carries
the weight of responsibility. There are different debates around this area,
leadership cannot oblige all stakeholders, and there could be fractions that
might feel the leadership has not acted responsibly. Satisfying all sections of
the organizations is an undesirable task for the leadership. It is practically
less possible to have everyone on board to agree. Disagreements and disputes
are bound to surface; the leadership carefully caters to the situation and the
quality of responsibility shown in the behavior will inevitably reflect.
Multiple stakeholder priorities have to be addressed by the responsible
leadership while carefully managing globalization and macro-level forces in an
organization (Maak T 2006, Waldman 2008).
Fostering trust among the workforce
and reinforcing faith during challenging times firmly establishes the crucial
role played by leadership behavior and its decision making ability.
Mismanagement in an organization can never really be attributed to a single leader. Leadership at multiple levels works in the
behavior aspect. At different levels of hierarchies senior leaders influence
the behavior of the leaders who they oversee and in turn it reflects on the
behavior of the team and employees and the organization as a whole (Searle and
Barbuto 2013). Authentic leadership builds values of discipline, legitimacy and
honesty that can reinforce the faith of the followers in a given system (Hirst
2016).
The qualities of a leadership
behavior (House and Mitchell 1974) such as directive, supportive, participative
and achievement have a necessity to be analyzed in organizational context.
Supportive leadership and Participative leadership were similar to the behavior
known as "consideration", while the Directive leadership and
Achievement-oriented leadership styles were similar to the behavior known as
"initiating structure". The past literature discusses routes, evolution and progress
of leadership behavior under different styles and aspects. However, studying
the leadership behavior during a pandemic that has not been witnessed in the
last hundred years is altogether a new dimension for research. The study is
aimed to estimate corporate leadership response from the perspective of COVID
19 in three factors 1) Employee safety 2) Employee motivation & 3)
Achieving business goals/objectives.
Research
Methodology
Sample
and Questionnaire:
The study is based on primary data
collection. Non-probability judgment sampling was used to define the sample.
Questionnaire was shared with a cross section of CxO level leaders, Founders,
Presidents and other senior leadership from multinational corporations, listed
companies, and fortune 500 companies. It was a deliberate choice not to
approach leaders of the same industry section to ensure that the cross section
of data collection is more effective. On an average, 9-10% response is aimed
for data gathering under each industrial group to ensure equal participation.
In total 619 respondents were approached, of which 247 responded. After removing
incomplete responses a total of 207 responses were taken for the study.
A semi structured questionnaire was
formulated after studying Multifactor Leadership Questionnaire (MLQ) and Work
Values Questionnaire (WVQ). The questionnaire was divided into three sections
1) Leadership responsibility towards employee’s health and financial/economic
safety, 2) Leadership facilitating motivation aspects to employees, and 3)
Leadership enabling business focus and optimism. The questionnaire was reviewed
by two senior academician and behavioral study experts. Given the extremely
busy schedule of executive leadership a simple questionnaire with closed choice
was used to capture the response.
Hypothesis:
H0 -
During COVID19 the leadership is not providing adequate care towards workforce
H1 -
During COVID19 the leadership is providing adequate care towards workforce
Tools employed for data analysis:
Percentage of response gathered is
used to draw inference and conclusion of the test.
Limitation
and Scope
The study is limited to
understanding corporate leadership behavior and commitment ability during
pandemic-COVID19 i.e. during challenging business times and it does not cover
leadership in public sector entities. The study covers corporate establishments
and not SMEs.
The study can be future extended to
understand wider gender behavior at leadership level during challenging
business times. A focused study on behavior of first generation entrepreneurial
leaders or women self-help groups during challenging times can be researched.
Data
Analysis and Interpretation
This investigation was based on the
data gathered from 207 leaders at Executive leadership and CxO level and their
direct reporting leadership. The demographic classification of the respondents
is below:
Table 1. Demographic Classification
|
Demography |
Responses |
In % |
|
Gender |
||
|
Female |
27 |
13% |
|
Male |
180 |
87% |
|
Total |
208 |
100% |
|
Organization Size |
||
|
Below 10,000 |
110 |
53% |
|
Above 10,000 |
97 |
47% |
|
Total |
207 |
100% |
|
Region |
||
|
Central & South East Asia |
101 |
49% |
|
Europe & UK |
35 |
17% |
|
US & Canada |
44 |
21% |
|
Middle East |
27 |
13% |
|
Total |
207 |
100% |
|
Designation |
||
|
CxO |
53 |
26% |
|
President, Chairman, Executive leadership |
23 |
11% |
|
Founder, Co-founder |
21 |
10% |
|
BU Head, Director, Vice President, Sr. Vice President |
110 |
53% |
|
Total |
207 |
100% |
Table
2. Industry wise responses
|
Industry |
Count |
In % |
|
Auto & Manufacturing |
20 |
10% |
|
Aviation and Aerospace |
10 |
5% |
|
BFSI (Banking, Financial and Insurance) |
25 |
12% |
|
Construction Industry |
20 |
10% |
|
Consulting & Data Analytics |
12 |
6% |
|
Ecommerce |
15 |
7% |
|
FMCG (Fast moving consumer goods) |
23 |
11% |
|
Healthcare & Pharmaceuticals |
22 |
11% |
|
Information technology |
28 |
14% |
|
Large and Tele-Communication |
10 |
5% |
|
Lifestyle |
22 |
11% |
|
Grand Total |
207 |
100% |
Data has been collected across a
number of industry verticals. On an average, 9-10% of response has been
gathered under each industry type to ensure right mix and balance.
Table
3. Variable cluster*
|
Factors |
Variable Cluster |
No |
Yes |
Total |
|
|
Health and Economic Safety of Employees |
Employees safety
before lockdown |
Count |
7 |
200 |
207 |
|
% within cluster |
3% |
97% |
100% |
||
|
Life insurance
enchantment |
Count |
145 |
62 |
207 |
|
|
% within cluster |
70% |
30% |
100% |
||
|
Allowing work from
home before govt. advise |
Count |
42 |
165 |
207 |
|
|
% within cluster |
20% |
80% |
100% |
||
|
Salary cut at
leadership level to benefit employees |
Count |
89 |
118 |
207 |
|
|
% within cluster |
43% |
57% |
100% |
||
|
Bonus & Incentive
cut throughout organization |
Count |
110 |
97 |
207 |
|
|
% within cluster |
53% |
47% |
100% |
||
|
Motivation aspects of Employees |
Speaking to the
employees directly |
Count |
10 |
197 |
207 |
|
% within cluster |
5% |
95% |
100% |
||
|
Dip in employee motivation |
Count |
175 |
32 |
207 |
|
|
% within cluster |
85% |
15% |
100% |
||
|
Encouraging creativity
and idea generation |
Count |
17 |
190 |
207 |
|
|
% within cluster |
8% |
92% |
100% |
||
|
Adding more work to
employees |
Count |
167 |
40 |
207 |
|
|
% within cluster |
81% |
19% |
100% |
||
|
Direct client
management by leadership |
Count |
108 |
99 |
207 |
|
|
% within cluster |
52% |
48% |
100% |
||
|
Leadership response to Business Goals |
Difficult to revive
business |
Count |
40 |
167 |
207 |
|
% within cluster |
19% |
81% |
100% |
||
|
Business goals
accountability |
Count |
4 |
203 |
207 |
|
|
% within cluster |
2% |
98% |
100% |
||
|
Envisioning
opportunities during COVID19 |
Count |
35 |
172 |
207 |
|
|
% within cluster |
17% |
83% |
100% |
||
|
Honoring offer of
employment already made |
Count |
15 |
192 |
207 |
|
|
% within cluster |
7% |
93% |
100% |
||
|
Assimilation of newly
joined employees |
Count |
36 |
171 |
207 |
|
|
% within cluster |
17% |
83% |
100% |
||
*Based on primary data collected from leadership through
survey method
Overall, 97% of leadership had taken
adequate measures and sufficient action focusing on safety parameters of their
workforce before the lockdown was announced. However 20% of the respondents
from the FMCG sector could not pay much time on employee’s safety before the
lockdown period.
During the pandemic-COVID 19,
governments of the day had advised all industries to shut shop, the study
conducted analyzed if the government agency had not insisted on industry close
down would leadership prefer employees working remotely. For which, 80% of
leadership response is that they would not want to compromise the health and
safety of their workforce, and prefer their staff working remotely irrespective
of government regulations. In the construction industry 60% respondents felt,
but for government mandate they would like to have their employees coming to
work despite COVID19 outbreak. This was followed by 50% of respondents from
E-commerce platforms, which prefers the same.
On the aspect of understanding the
futuristic thinking behavior of leadership, for questions regarding employees
‘life insurance cover’ during the pandemic, an overall 70% of respondents did
not enhance the benefit despite World Health Organization declaring COVID 19 as
pandemic (during early March, 2020). Interestingly, 56% of respondents from the
Healthcare and Pharmaceutical industry have already taken measures to upgrade
‘life cover’. It is necessary to point
out that the questionnaire did not dwell into health/medical insurance benefits
given that most governments have already announced cover for treatment of
coronavirus. 44% of women leadership has responded positively to enhancing
‘insurance life cover’ to the staff due to pandemic-COVID-19.
On the questions of leadership
taking ‘salary-cut’, 57% of the leaders in organizations are willing to take a
cut to enable the benefit getting passed over to employees. It is to be noted,
67% leadership from Aviation and Aerospace and 66% of leadership from BFSI
sectors are not in favor to consider a ‘pay cut’.
In case of the organizations whose
workforce headcount is less than 10,000, 54% of the leadership is already
contemplating on cutting down promotions, bonus, incentives or variable pay for
current year. From overall industry stand point, 75% of E-commerce industry
leadership and 67% of Aviation and Aerospace industry leadership recommend no
promotion, bonus or variable pay for current year.
The study also wanted to check on
leadership’s immediate plans for candidates already offered with employment or
prospective employees. By large, 93% of leadership has not considered the
option of revoking or rescinding the offer/letter of employment made to
prospective candidates; however, 33% of leadership in Aviation and Aerospace
sector had to cancel the offers made to future joiners. 83% of leadership has
managed to sensitize the organization culture with newly joined workforce
during lockdown.
The study also covered the aspect of
leadership reaching out to employees to keep them motivated and engaged, since
meeting the organization workforce is now remote.
95% of leadership had direct contact
and connection with their employees during the pandemic. Significantly, 85% of
leadership does not think their employees motivation level has dropped given
business operations have moved to remote. However, 50% Leadership from the
Telecommunication sector and 46% leadership in the Consulting sector already
feel their employees’ motivation levels have taken a hit. 92% of leadership has
encouraged their teams’ creative thinking and idea generation using the
pandemic-COVID19 situation.
A majority of 81% of leadership
cutting across industry feel that the path to revive from business damage
caused by pandemic-COVID19 is going to be difficult. Of which, 83% of leaders
from organizations with less than 10,000 people feel the severity of business
damage is high.
Two industries sounded optimistic,
i.e. 50% leaders from E-commerce platforms, followed by 33% leadership from
Healthcare & Pharmaceuticals, feel the path to revival may not be that
difficult. Overall, 83% of male leaders sound confident to revive business
compared to 69% of the women counterparts.
83% of leadership envisions business
opportunities while others talk about problems caused by COVID-19. 98% leadership has shown a sense of ownership
and accountability to achieve business goals and organization objectives.
During the lockdown, 52% of
leadership did not get a chance directly in handling clients and customer
concern. Whereas 80% leadership from FMCG sector, followed by 75% leadership
from Telecommunication sector, and 63% of IT leadership had to handle issues
faced by the customers and clients directly to ease the burden of their teams.
Achievement of Hypothesis:
H0 - During COVID19 the
leadership is not providing adequate care towards workforce
H1 - During COVID19 the
leadership is providing adequate care towards workforce
From the above inference summary it
is quite clear that there is sufficient evidence to support the claim that: during
COVID19 the leadership is providing adequate care towards the workforce. Given
that H1 is proven after analyzing primary data and H0 is not proven, hence H0
is rejected.
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