Uncertainty is the real problem
Whichever way you voted, and whichever side of the argument you come down on, Brexit is being blamed for a lot. Multiple sources attribute the slow down of the housing market to uncertainty over Brexit. The slump in new car sales is also attributed in part to Brexit and the car market has also been affected by fuel confusion. The VW emissions scandal resulted in uncertainty as to the future of diesel and uncertainty as to which is the better option between electric vehicles, hybrids, or petrol vehicles. Hong Kong is also experiencing a slow down in its housing market as a result of political unrest. The keyword in all of this is uncertainty. When people are uncertain, they slow down or stop whatever they are doing until they are clearer about what’s going to happen. Uncertainty leads to inaction. Certainty leads to action.
Think of it like walking through a strange town. You use your phone to navigate using Google maps. Whilst the route is clear, you stride out towards your destination but as you get closer, the route gets more complex and it’s harder to work out which exact street you should be taking, so you slow down to study the screen carefully, anxious not to go in the wrong direction. If surrounded by high sided buildings in the middle of a city, the satellite signal may be a little erratic and you have to stop and wait until the signal is established and your direction is clear. You don’t want to waste time and effort in going the wrong direction. It’s frustrating having to wait and can induce anxiety, especially if you are late for where you are meant to be.
Just as with the navigation, the issue with the housing market and car sales is not Brexit, but uncertainty. It is the fear of the unknown that holds us back. The “What if….?” scenarios play through our mind and in the absence of clarity, it’s sometimes easier to stop and do nothing. The difficulty is we cannot predict the future and we can only take a guess.
For some things, that best guess is good enough. We can predict the school places we will need in five years because we have an idea today of how many babies have been born and in five years these babies will all be five-year-olds needing places at schools. It also gives us an idea of how many university places we will need in eight years time. Whilst we cannot know the exact numbers of school and university places we will need, we can have enough confidence to make some decisions. But for the housing market and new car sales, it is very difficult to predict the future because the impact of Brexit and government policy means the future is unlikely to be a replication of the past. We have very little to go on to establish any form of certainty. Without this, it is better to hold fire and adopt a ‘wait and see’ approach. As a result, people are not buying houses or new cars and so the economy is impacted and consumer confidence is eroded.
We can learn a lot from this for business. Organisations seeking to change what they are doing and the way they are working ignore at their peril the need to help the workforce feel in control over what’s happening. Unless people know what’s happening or likely to happen, then they are quite likely to slow the process down until they do. All this is somewhat common sense. The blindingly obvious solution is to communicate what’s happening. But what is common sense is not always common practice. In an interesting piece of research, it was identified that the amount of information leaders in business think they have communicated to their workforce is significantly greater than that perceived by those in the layers below, a trend that continues to the bottom of the organisation. Thus, while you may think people should or do know, then chances are, they know far less than you think. If you are facing resistance towards the changes you are trying to implement, then chances are it’s because you have created a Brexit in your business, i.e. created a strategic direction, the outcome of which is unclear, and the risks of a negative consequence perceived by some as high. Where you have a degree of certainty about the future, it is important to communicate more often to ensure people understand what will probably happen.
Of course, there may be situations where you simply don’t know what’s going to happen. The future is predictably unpredictable. Even in the face of uncertainty where we simply do not know, it is still possible to bring some sense of control to those affected. For example, if there is a chance people could lose their jobs, then helping them prepare for this with financial advice, career planning help and interview practice could go a long way to helping people feel like there is a future whatever happens. It doesn’t help them with knowing whether they will or will not have a job, but it does help them prepare for either eventuality. The fear often expressed is that all this does is help the good people leave. But just because you have helped people feel in control by helping them mitigate the risks of potential redundancy, does not mean they will necessarily leave. Rather, it may result in higher levels of employee engagement because of the care the organisation is showing. This in a time of uncertainty, certainty and control have been improved by helping people prepare for whatever happens.
As the 31st October approaches, perhaps the most useful thing the government can do is to set out the range of risks with each of the possible outcomes and help people mitigate these risks. Whether that is helping people anticipate possible redundancy and putting in place measures to support them, or in helping businesses plan for possible new trading regulations or individuals planning for border crossing on their overseas holiday. Perhaps the most helpful thing companies can be doing is to speak to its people across the business to understand to what extent the plans for the future have been truly understood.
Dominic Irvine © 2019 All rights asserted.
This was posted in Bdaily's Members' News section by Dominic Irvine .