What does the postpandemic workplace look like in the retail and consumer-goods industries? How should companies set and manage the new expectations of corporate employees and field staff? Over the longer term, as automation and digitization advance, how can retailers and consumer companies take on the reskilling challenge? In this episode of the McKinsey on Consumer and Retail podcast, McKinsey partners Bryan Hancock and Ashish Kothari offer insights into the future of work. An edited transcript of their conversation with executive editor Monica Toriello follows. Subscribe to the podcast.
Monica Toriello: If you’ve traditionally worked in an office, the return to the workplace is probably something that you and your company have been thinking and talking about a lot these days. Indeed, the nature of work has changed for almost everyone in the past year and a half, raising important questions about the future of the workplace and the workforce. Technology is, of course, a huge factor affecting the future of work: e-commerce and digital channels, contactless solutions, automation and robotics in both stores and warehouses—all of these are having and will continue to have a major impact on what work looks like in the consumer sector.
Today we’ll hear from two McKinsey partners who have thought quite a lot about this topic. Bryan Hancock, a partner in our Washington, DC, office, is the global leader of McKinsey’s work on talent. Those of you who listen to the McKinsey Talks Talent podcast will already be familiar with Bryan. He has advised a wide range of talent-intensive businesses—not just retailers but also banks, healthcare providers, transportation companies, and so on. Also with us is Ashish Kothari, a partner based in the Denver office. He leads our “reenergizing organizations” work, which is focused on helping consumer companies as they support employees in combating pandemic fatigue and increasing well-being. He has worked alongside many leading retailers and packaged-goods players. Welcome, Ashish and Bryan.
Before we get into it, what has return to the workplace looked like for you personally? Have you started traveling again? Are you wearing jackets and collared shirts again?
Bryan Hancock: We’re slowly opening up our office; we’re doing it in phases. What I found most interesting is that the demand for meeting in person has picked up a lot, so we’re going on site visits and getting on airplanes. Honestly, it’s great to be back.
Ashish Kothari: I did my first client trip a few weeks ago. I got a chance to see a client whom we started working with in the middle of the pandemic; we hadn’t actually met them in person. It was wonderful to be able to see them.
‘Return to work’ dilemmas
Monica Toriello: “Return to work” or “return to office” and “future of work” mean many different things, even within just the retail and consumer sector. As you talk to CEOs and business leaders in the industry, what are their one or two biggest questions about the future of work?
Bryan Hancock: There are two things that are top of mind. One, consumer demand has shifted; therefore, the way work is done has shifted. The pandemic has accelerated the shift to online, and with that comes a shift in the type of skills needed in headquarters and the balance of roles needed in the field.
Two, what does “return to office” mean for organizations that have a national footprint but where many of their employees—or the majority of their employees—have been coming to the store every single day? What are the expectations for the corporate staff? Do we expect them to come back to the office because that’s been the expectation for the field staff? Or do we use this as an opportunity to rethink our talent—because maybe we’re located in the heartland, but some of the best tech-talent hubs in the country are in places like Austin; Atlanta; the Washington, DC, area; or Boston? Does this give us the ability to access that talent?
But if we do hire in those tech hubs, then how do we create the right connections? Are we saying they don’t have to come into the office? How do we manage this tension of, “We’re an organization that delivers our services in person,” with, “For some of our corporate functions, we may now be able to get better talent remotely.” How do we resolve that? This is what some CEOs are thinking through and thoughtfully wrestling with.
Ashish Kothari: I’ve had about 30 conversations with companies over the past six weeks. One of the themes that keeps coming back is the following: We knew before the pandemic that a flexible working arrangement was one of the top benefits that employees wanted, so how do we manage expectations and set the right rationale for why we’re bringing people back to the office?
The numbers are quite stark. Across different generations, we’re seeing that 25 to 35 percent of people want to continue working from home 100 percent of the time. Then, some percentage of people want two or three days a week in the office. Very few want to be in the office 100 percent of the time. So how do we manage that communication, that expectation setting?
The second big challenge that many companies are being forced to rethink is, how will work actually get done in a world that will be increasingly hybrid? It’s easy to say we’re going to be hybrid, but it’s hard to figure out the details of how we’re actually going to do work in that hybrid setting.
Monica Toriello: To some extent, everyone’s figuring this out as they go, right? What are the best practices that you’ve seen? And on the flip side, what are some of the most common mistakes that you’re seeing companies make as they navigate this next normal?
Bryan Hancock: One of the best practices is really thinking through, from a business standpoint, what work needs to be done in person and what work can be done remotely—and thinking about it by role and even by task. If I’m crunching through emails for a day, do I have to be in the office to do that? And how do we then segment into different roles and archetypes so that we can say, “For this type of job, it’s OK to be home one or two days a week to do this kind of work. When we need to do this other kind of work, let’s do that in the office.”
Be thoughtful in the segmentation and link that segmentation to how value is created. Be very clear that, “When we’re required to be in person, let’s make sure we’re optimizing that time.” We’ve heard some clients describe coming to the office as “the new off site”—it’s the time when we have intentional interactions working together to advance what we can do jointly.
Adaptability and resilience
Ashish Kothari: If you look at any external surveys out there, they’re showing the same as what we’re seeing internally: burnout is at an all-time high. So how do we train employees to tap into their inner resilience? Our future world is going to be a fundamentally more volatile and unpredictable world, so how do we build skills around adaptability and an ability to learn continuously?
Bryan Hancock: Let me pick up on that and tie it to something very practical, which is the daily commute. The daily commute was a time when you were largely alone with your thoughts. You might be listening to a podcast like this one; you might be listening to music; you might also be thinking through your day and what you need to do. And it’s a time of transition from home life to work. The commute home is a time to reflect, decompress, and process the day. That time for processing and that separation between home and office have been shown to be healthy.
If we’re in a world where that separation starts to blur more, as it has in the pandemic, teaching people how to inject that time for reflection and transition and how to adapt their rituals are things that can very practically be done to help them adjust. That commute, for all its frustrations, had some good mental-health side effects. How do you make that transition happen if you’re home more? And then, if you combine that with all of the other changes happening, to Ashish’s point, instilling a broader adaptability mindset and teaching resilience tools can be very beneficial.
Monica Toriello: I imagine adaptability and resilience are pretty hard to teach. Are there examples of companies that are doing a good job with this?
Ashish Kothari: First, let’s define what adaptability and resilience are. We define “adaptability and resilience” as the ability to bounce forward not necessarily just bounce back. Implicit in that definition is this core ability to learn.
Through research, we found and identified seven key mindsets and six core capabilities that resilient and adaptable people show. The mindsets include a growth mindset versus a fixed mindset, a mindset around abundance versus scarcity, and a mindset around agency, which is an ability to take action versus being a victim. These are absolutely things that can be trained and measured.
The same goes for the six fundamental capabilities, which include self-awareness, perspective taking—which is being able to hold multiple perspectives versus just simple stories of black or white and right or wrong—and capabilities around well-being, which means taking care of ourselves mentally, physically, and spiritually. There are skills and behaviors around building connection with each other, even through simple moments. I’ll give you an example. How many times do you ask, “How are you?” And how many of those times are we really interested in hearing how the other person is? Or, when somebody asks us that question, how often do we truly share how we are feeling? Taking some of those simple moments to give people a chance to open up and share can increase connection.