Customer Type: Private and Public Companies

Despite all the uncertainty and disruption still lingering from last year, 2021 offers ample opportunities for companies to refocus on what matters most: healthy communication and collaboration, an inclusive workplace culture, and ultimately greater productivity. While companies need to understand what will be different in the post-COVID era, they should also remember what will stay the same: the need for real human connection, whether it is mediated by technology or not.

 

#1 – New Ways To Assess and Engage With Employees

Office politics has always been a fact of life – employees have often been rewarded by who knows how to best navigate office politics versus who does the best work. We are now seeing signs that remote work can help companies reward employees based on merit and by giving traditionally overlooked colleagues more of a voice and having more objective processes to measure them. In some cases, the remote work era is even prompting companies to consider new employee performance metrics altogether.

According to a recent PwC survey of U.S. executives in the process of shifting to remote work, most companies are focused on “greater flexibility in work hours” (57 percent) to drive productivity. In effect, outmoded measures of employee performance – such as the number of hours an employee works – are becoming less important. Companies are instead moving to a more merit-based model: efficiency in completing a task, quality of work, and the ability to collaborate productively with colleagues.

While the trend toward evidence-based employee assessment was already underway before COVID-19, the pandemic has privileged some forms of interaction and evaluation over others. For example, a recent Deloitte report explains that remote work is “usually assigned by the outcome, instead of by task, enabling productivity assessment.”

The influence of office politics on managers’ perceptions becomes more limited as they make assessments based on concrete outputs versus subjective impressions. Although after-work drinks or trips to the golf course help colleagues build closer connections, these activities can also be exclusionary and give managers a biased attitude toward employees’ performance.

We will never get to a point where in-person interactions are completely supplanted by technology (nor should we want this to be the case), but managers should take this opportunity to determine if their assessment methods are as rigorous and impartial as they can be.

 

#2 – Balancing Productivity With “Organized Serendipity”

Many employees have proven that they’re capable of being just as productive at home as they are in the office – in fact, 94 percent of employers say productivity has been just as high or higher during the pandemic as it was before. Other surveys (such as this one conducted by the Boston Consulting Group) have found that a significant proportion of employees have maintained their productivity while working remotely. Meanwhile, 72 percent of office workers say they would like to work from home at least two days per week.

Although productivity has remained steady, employees haven’t been able to interact with their colleagues or clients/customers as naturally as before. Without chance encounters in the break room, close colleagues poking their heads around corners to say “hi,” and the occasional coffee meetup with a client, employees may feel disconnected. As we all know by now, this can eventually take an emotional and psychological toll. What can companies do to address this?

As offices remain closed and people continue to work from home, companies may consider creating what I call organized serendipity – getting people together in a structured but organic way to facilitate relationship building and creative collaboration. For example, at BluWave, we’ve launched a virtual, topic-driven event series to share best practices among our roster of PE fund clients. After a brief panel discussion, clients break out into discussions on sub-topics and network with each other using an interactive technology platform. The organization comes from cutting the groups by functional expertise, but the agenda is loose enough to allow for actual networking that does not feel forced.

On the employee front, while some are still working from home and others are socially distancing at our physical office, we host “Friday lunch hours” that gather everyone together to share a meal and chat about the upcoming weekend.

 

#3 – Making the Era of Remote Work More Human

“Zoom fatigue” – a term used to describe the lack of motivation for hopping on yet another video work call, joining a digitally-driven event, or getting together with family and friends virtually – is becoming a real threat to remote workforces. No matter how well we integrate remote work into our lives, we will never be able to replace the value of in-person human connection or shared experiences.

According to a recent survey by Slack, 45 percent of newly remote workers report that their sense of belonging has suffered since they began working from home. This is a powerful reminder that companies should focus on building authentic and consistent human connection into their remote work platforms.

Once it’s safe to do so, companies should swiftly prioritize in-person interactions. Even now, many companies recognize that it’s impossible to shift to 100 percent digital communication – a reality I’ve seen personally with private equity fund managers who still need to shake the hands of the management team before purchasing a company or stepping into the company’s facility. Once the threat from COVID-19 subsides, remote-focused companies should still give employees opportunities to interact with meet-ups, site visits, and other events that satisfy our need for human connection.

The original version of this article was published on Toolbox HR.

 

Effective managers are capable of articulating their company’s values and a clear set of concrete goals, while also maintaining a commitment to diversity and open communication. These principles will help companies move from a rigidly hierarchical dynamic in which workers feel disconnected from their jobs to one in which they feel like stakeholders and partners whose opinions are valued.  

As someone working in the area of third-party resources, it’s evident that managers of today are connecting the dots between the agile workforce, remote workers, and full-time employees. This is no simple task, but with a few basic shifts in thinking it’s entirely possible and produces desirable results. 

As we enter a new era of remote work, managers will be under increasing pressure to improve communication and collaboration among diverse teams (no matter where they are in the world) and provide employees with a common goal to rally around. 

Here are my top four suggestions for building and maintaining high performing teams that will remain loyal long after the dust settles: 

#1 – Motivate Your Employees by Sharing Your Values and Goals 

#2 – Recognize That Diversity Is an Engine of Innovation 

#3 – Keep the Lines of Communication Open 

#4 – Build Greater Participation 

 

For more insights, and details on the “how”, please check out my full article, published in Toolbox HR. And as always, if you have questions or need anything from BluWave please reach out! 

 

 

 

The COVID-19 pandemic won’t last forever, and companies need to be thinking about how to best position themselves to not only maintain their operations, but also seize upon opportunities and prepare for an uncertain future. This means they’ll have to be agile, getting the right people with the right skills at the right time.  

Our economy is more dependent on expertise than ever before – a fact that’s even clearer amid this crisis. A 2019 study conducted by the Society for Human Resource Management found that 83 percent of hiring managers “had trouble recruiting suitable candidates,” 75 percent of whom attributed this problem to a skills shortage in the workforce.  

The recovery from COVID-19 is going to require a lot of innovative thinking, which means contributions from a broad range of experts in many different fields. But expertise is scarce – especially for companies with limited resources. Experts are always in high demand, even more so when companies begin rebuilding after a shock like COVID-19. Companies have little margin for error and they’re taking a hard look at their processes and personnel. That’s why we’ll soon see a spike in the need for on-demand expertise across a wide range of disciplines. 

Here are a few strategies for finding experts and making the most of their skills. 

Know what you’re looking for.
First, your business needs to take the time to thoughtfully define what it needs. For each role, systematically build scorecards outlining what expertise is required for each initiative. This scorecard should measure functional experience, industry experience, budget, values, and the ability to learn and change. For example, if a food manufacturing company is hiring an interim CFO, a candidate with years of manufacturing experience is not enough. The company should look for a candidate who has worked in the food industry, and who has a track record of successfully managing crises and other fluid situations.  

Know where to look.
To find experts like this, you could start by canvassing your personal and professional networks with a specific “ask,” and be specific about your key criteria, timeframe, and budget. These constraints and goals will guide which kind of expert you’re looking for. In some cases, you want someone who can mobilize teams rapidly or manage a fast-moving crisis. In others (some forms of product development, for instance), you want someone who’s more deliberate and meticulous.  

Use intelligent networks.
Intelligent expertise networks are only going to become more important in the coming years as the need for on-demand skills jumps, availability becomes scarce, and margins for error decline. Naturally, a firm like BluWave with deep industry relationships, proprietary datasets, and pre-vetted networks of private equity-grade resources is going to yield faster, more optimal results.  

Explore the alternative workforce.
According to a 2019 report from Deloitte, companies are leveraging alternative workers to address their expertise needs across a wide array of positions. Traditionally, most companies use the alternative workforce for highly specialized technical needs like I.T. However, the employment of alternative workers is rapidly spreading to other areas like sales, marketing, finance, and operations.  

Focus on integrating alternative workers and developing their skills.
Despite the surging demand for alternative workers, only 8 percent of companies report that they have “established processes to manage and develop alternative workforce sources.” The alternative workforce offers access to a growing and sophisticated talent pool, but employers need to develop the resources necessary to successfully draw upon this pool.  

Companies need to think of the on-demand alternative workforce just like they think about their full-time workforce. Define what is necessary to perform well in each role. Recruit candidates who have the specific expertise you require. Hold alternative workers and their managers accountable for results. At the end of the contract, both the employer and the alternative worker should evaluate whether a longer term, full-time relationship would be mutually beneficial.  

The economy is only becoming more interconnected and complex, which makes expertise vital. That’s why companies have to understand what expertise means to them, where it can be found, and how to use their knowledge and talent as effectively as possible.  

A version of this post originally appeared as part of the Forbes Business Council.

When I left my partner position at a PE fund to start BluWave, I sought an operating framework to help us build the company in an agile and customer-centric way. I embraced a model conceived by Air Force Colonel John Boyd called the OODA Loop (Observe, Orient, Decide, Act). This framework has been extremely helpful as we’ve grown to serving more than 350 PE funds in a short period of time. Now more than ever, we have found it to be invaluable as we navigate the uncertain world that has emerged since COVID arrived. Here’s how you can use the OODA loop in your business: 

Observe:
Get actionable data. One relatively inexpensive approach to gathering the right information is the use of a PE-grade voice of the customer firm to actively talk with your customers. As the economy reopens, ask your customers about the progress of their recovery and what products you should lead with. It’s amazing what customers will tell you if you ask. It’s also crucial to clean your data – we’re equipping portcos with interim data-oriented financial planning and analysis teams that can conduct a sprint in order to make data actionable. 

Orient:
Synthesize your observations. Many portcos we support are using PE market due diligence groups to assess competitive landscapes and propose potential courses of action. This is a way to repurpose an existing tool to improve probabilities of success and ROI. We’re also helping a lot of companies rapidly deploy data integration, visualization, and analytical resources to make informed decisions. If you haven’t used these resources yet, now is the time.  

Decide:
This is up to you and your team. The only advice I have here is to get buy-in from your team, as well as your board (for the bigger stuff). This is also a great time to question sacred cows, take a close look at SKUs, make your operations more efficient, etc. Never waste a crisis. 

Act:
It’s time to get going. After collecting hard data, forming conclusions about it, and making decisions with your team, now is the time to make a move. This is where it’s essential to be as adaptable as possible – the road back to Rome is not going to be straight. Be as just–in–time with your resources as possible.  It’s a great time to start using variable resources (aka the “alternative workforce”) to get things done more efficiently and effectively. 

Right after you act, immediately begin the OODA loop again. The most successful companies will be the ones that are agile and diligent during this chaotic and unpredictable time.

Although states and businesses are beginning to reopen amid progress in the fight against COVID-19, the economic fallout has been devastating. Over the past nine weeks, almost 40 million Americans have filed for unemployment while the unemployment rate reached almost 15 percent in April – a number that has steadily increased since then. The private equity industry plays a substantial role in the U.S. Economy.  This raises the question: How is the PE industry equipped to support an economic recovery after such a massive shock?

One way to answer this question is to take a look at how PE-backed companies performed during the global recession in the late 2000s. A 2017 paper published by the National Bureau of Economic Research found that PE-backed companies were more resilient and rebounded more quickly than their non-PE-backed peers during the crisis, which offers hope for our economy today. Here are the top takeaways from that report:

1. During the last Great Recession, private equity backed companies were able to make greater investments supporting their recovery than non-PE-backed companies. Their average quarterly business investment volume was between 5 and 6 percent greater, an effect that’s “not only statistically significant, but also large in economic magnitude.” PE-backed companies maintained this higher level of investment after the crisis.
2. PE-backed companies had access to more debt and equity capital than their non-backed peers, by 4 and 2 percentage points, respectively. Meanwhile, the “cost of debt, measured by interest expense over total debt, was relatively lower for PE-backed companies during the crisis.” The researchers partly attribute these observations to the fact that private equity firms have strong relationships with lending institutions, which gives them more access to credit. PE investment also “did not lead to a low quality or excessively risky projects.”
3. PE-backed companies that were more likely to face financial constraints during the recession (as indicated by factors such as their dependence on outside financing and their “pre-crisis leverage”) were especially likely to benefit from PE investment. Overall, the researchers write, “Private equity firms alleviated financing constraints of portfolio companies during the financial crisis, allowing them to invest more when credit markets were frozen and economic uncertainty high.”
4. PE-backed companies saw “greater growth in their stock of assets in the years after the crisis” and actually increased market share during the recession: “In the crisis period,” the researchers write, “PE-backed companies experienced an 8 percent increase in market share relative to the control group.”
5. PE-backed companies were comparatively seen as more attractive businesses by would be suitors after the recession.  The study found PE-backed companies were 30 percent more likely to be successfully acquired in the post-crisis period. Moreover,

At BluWave, we are already starting to see history repeat itself.  Our clients are moving at a rapid pace in support of the resurgence of their portfolio companies.  We are witnessing each of the elements of the above occurring in real time once again.  Moreover, we are seeing innovative applications of technology and business processes that we’ve never observed before.

While no two recessions are the same, the report suggests that PE-backed companies have several advantages as we navigate another severe economic downturn.  Private equity backed companies will have greater access to capital (at a lower cost) which will allow them to strategically invest more than their non-PE-backed peers and in turn support a faster economic recovery in the United States.

A few weeks ago, before the world seemingly imploded with the Nashville tornado and news that the coronavirus was on the move and spreading fast, BluWave was tapped for an Inc. Magazine article about how the “alternative workforce” fits into the future of work.

In retrospect, and without knowing it at the time, the insights we gave couldn’t be more true—particularly now that millions of companies have been upended and will rely on fast-moving, highly-skilled experts to help them rebuild and steer their ships in the right direction.

The three key takeaways of the article are this: We’ve entered an age of specialization, the right top-notch talent at the right time isn’t easy to come by but is absolutely necessary for growth, and harnessing the power of networks is increasingly important.

With regard to that last one (which is how we fit in) this is an important data point:

According to Deloitte, specialized talent networks “now manage over $2 billion in outsourced activity, employing hundreds of millions of people in every geography of the world.” 

And as the article states: “These numbers are only going to increase in the coming years, as the alternative workforce continues to help companies keep pace with the demands of a rapidly shifting economy.”

We believe the economy is going to fundamentally change in light of recent events to be more agile so businesses can grow anew by doing more with less. The specialized talent ecosystem is going to play a critical role in our economic resurgence.

If you have 7 minutes, the full article is definitely worth a read.

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