This article was published in the April Issue of New Zealand Management Magazine.
The world is far different than it was even a month ago. A global pandemic has gripped nearly every facet of our lives, adding to lingering panic, fear and uncertainty in areas of our existence we thought were untouchable. The day is different, the world has changed and those of us lucky enough to witness the destruction from a distance have a responsibility to bolster our guard for the next exceptional world event.
In this current climate of crisis, you tend to find that we as humans look to the past rather than spend time dwelling on the uncertainty of the future, that we focus on anecdotes rather than probabilities.
The next six months are key
The truth about the next few months is that not much will be different on the surface – as long as the infection’s curve has flattened to a reasonable degree by that point. We’ll most likely find ourselves able to enjoy restaurants, bars and public life once again. and the majority of us will go back to work in some way.
However, the change that the world has undergone is not something that is easily undone. We are in the midst of a global haemorrhaging that includes money, resources and even cultural norms. Government infrastructures, private industry, non-profit entities and basic human services providers are in crisis. Most likely, as you read this, our actions to flatten the curve will still be in full swing.
It’s human nature to look for the way out – the bright light at the end of the tunnel. However, a healthy expectation can help everyone weather a storm no matter the force of the squalls. COVID-19 took the world by surprise and will continue to do so. However, once the surge of cases begins to taper off, the real work begins.
The changing ways we work
The biggest change we can likely all look forward to is based on the way we work. The next six months will showcase and highlight an accelerated work-life change that has been brewing for some time.
Where remote work had been seen for some as a perk or luxury, it has been catapulted into the realm of large-scale necessity. Interconnectivity and the use of technology to keep us and our businesses viable has become paramount to survival. Take Strategic Pay, for example. We’ve employed a number of technical solutions to keep our various locations connected and moving forward for some time now.
This new reality, however, forces every business that can be virtual into an organisation operating primarily on phone lines, emails and video conference calls.
Redesigning the pay structure
With this change in the way we work comes a change in the way organisations pay for that work. As much as New Zealand is being forced to move to more remote work solutions, we also find ourselves in need of a pay structure redesign. Starting with the standard of work.
Standards of work are going to be more important than ever. This global crisis will put a spotlight on the pay and pay structure of the future, particularly the remuneration design and restructuring. Employers are still going to need to know what their employees are doing and when – the expectation of oversight will still be full even if considered different.
Incentive pay will also find its place in a post-pandemic workforce. Bonus pay or incentive pay is probably the most important and dynamic part of remuneration. The flexibility incentive-based pay provides is going to be incredibly important for the future.
At its basic level, the mechanism of bonus pay allows the pay to ebb and flow based on the current climate. An expectation of pay being dependent on whether it’s a good year or bad year enables the organisation to remain afloat when times are tough and to collectively celebrate when times are good.
For many, the idea of remuneration in terms of incentive pay has negative connotations. We’ve all seen CEO bonuses that make headlines, often framed as a windfall or the hallmark of shady dealings. However, if structured correctly, incentive pay can enable motivation – though even motivation is over-emphasised as people walk away from bonuses all the time – as well as ownership of the good as well as the bad.
So what does the future of remuneration look like for New Zealand? No one really knows for certain. What we do know and what we can provide for certain are ways to bolster you and your business for the inevitability of uncertainty. Yes, this is a crisis, but New Zealand will get through it; we will come back to life, different than we were before but potentially better positioned to take whatever the world throws our way.
As life begins to transform to a new normal, other issues will arise, jobs will change and the way we connect our businesses will change. The technology solutions will change and inevitably more things will shift that we cannot even think of now.
During this time of crisis, many of us have more time on our hands, whether it be to make up for a long commute or because our workloads have shifted, it’s during this time that reflection is important. Ask yourself, does the business have good communication tools? Are your communication skills up to the mark?
Always understand the relativities between jobs and organisational structure – if you change the structures, you’ll change the pay. It is important to analyse jobs as well as understand the relativity of jobs as they change.
Businesses may need to look at the global view and assess what your business needs to maintain your organisation during an ever-changing economy.