Now that we’ve all finished discussing just how horrible 2020 was, it’s time to look ahead to 2021. There are plenty of reasons for optimism – but if we’re not prepared, we could miss out on the benefits of the post-Covid economic rebound.
My base case is that European and North American economies will see a strong recovery beginning around May, and businesses need to position themselves for that. But managers need to hold on tight to make sure we get to May in one piece. That’s because for some companies, there’s a very real risk that they won’t survive the first quarter: we still have some dark days ahead of us before we turn the corner. Managers need to grit their teeth, find a way to get through these months without losing their key people, and start building up inventory as the second quarter begins.
But with the first two vaccines already rolling out, and other drugmakers’ products coming down the approval pipeline, it’s clear that better times are on the way. Various U.S. officials have given various timelines, but being cautiously optimistic, it seems that in America, by around the end of May frontline workers will have had the shot, and the vaccine will be rolling out to the broader population.
The timing of the vaccine is also important: it’s arriving just as the days are getting longer and the weather’s getting warmer (at least in the Northern Hemisphere – apologies to my Australian and South American readers). I believe those things will feed on each other, creating a virtuous cycle of optimism in our part of the world. Businesses have to be ready for a flood of pent-up demand, particularly in areas like travel and tourism where people weren’t able to indulge during the pandemic.
That wave of optimism will continue through the summer. In Europe it will be interesting to see whether people take their traditional multi-week summer vacations; I think there’s a good chance that responding to the rebound in economic activity will keep employees closer to their desks than in a typical year.
Of course, there are several risks to that forecast that we have to keep in mind. One is that the second round of economic stimulus misfires. Governments around the world are still figuring out what works, and it’s possible that aid packages will turn out to be too small, or directed to the wrong parts of the economy.
The vaccine rollout is another area where things could go wrong: there’s a risk of hiccups in the manufacturing and distribution processes. And the question remains whether enough people will get the vaccine in order to give us herd immunity.
Those are my expectations for what we’ll see through the end of summer. Longer-term, it’s clear that Covid has permanently changed a few things about how we think about work. The first and most important change is that it’s showed us you don’t need to be in the office to be productive. The times when we spent five days at a desk in a central location may well be history. The pandemic has also taught us how little business travel we need to get by. That will have implications for airlines and hotels over the long term.
It may also have a long-term positive effect on gender equality in the workplace. Women have traditionally faced social pressure to sacrifice their careers in order to care for children; they may now find that with lighter travel schedules and more flexibility in terms of where they work, they’re able to stay in the game longer. Remote working may ultimately lead to a fairer distribution of childcare and other household responsibilities; it won’t happen overnight, but this is a real possibility for the generation that’s just now entering the workforce.
But while Covid has taught us that being in the office isn’t necessary for productivity, it’s also shown us that face-to-face interaction is absolutely vital for generating big ideas, building organizational culture and establishing sales relationships. Maintaining the status quo can be done remotely, but transmitting an ecosystem of values to a new employee still requires physical presence, total immersion, chance encounters, shared meals and other interactions that are possible only when you share the same physical space.
Organizations are organisms, and they need care and nurture. So I’d like to close with an analogy that has gotten much more familiar over the past year. Lots of people started baking sourdough bread during the pandemic, and if you’re one of those people – or if you’ve listened to them talk for more than a few seconds – you know that while there’s plenty of flexibility, to keep your starter alive and kicking, you need to have the right ingredients and the right conditions – heat, moisture and everything else.
Companies are the same way: 2020 has pushed many of our organizational cultures to the outer limits of what they can stand and still survive. The year 2021 will be a year of rebuilding those ties, of restoring the healthy chemistry that allows an organization to flourish. As a culture coach, as somebody who helps companies understand what makes their teams thrive, I can’t wait.