The COVID-19 pandemic is a rapidly-changing situation which is touching all our lives, both at work and home. In this 10 minute video message, recorded in his home office, Michael Burke, Aon’s Human Capital Practice CEO, outlines how Aon is working closely with clients to navigate the path through the risks that inevitably lay ahead.
Let me start by saying, I hope you and your families are safe and managing to cope with these uncertain times. We are all having to get used to a new reality - and get used to it very quickly. I am talking to you from the following three perspectives.
1. Firstly, as a parent, I'm worried about my family, as many of you are. We have three children, one of whom is a care worker. I also have high-risk parents. We're having to make tough decisions that change the way we live our lives every day. We're actually in a very fortunate position as there's people much worse off out there. However, the pandemic has created a lot of anxiety and I'm sure you and your teams are experiencing this.
2. Secondly, as a leader of a group of nearly 2,000 staff across the globe who are all concerned about COVID-19 and what does this mean.
3. Thirdly, as the head of Aon's Human Capital Practice, where I believe we're uniquely positioned to help colleagues, clients and families navigate the path through the people risks that inevitably lie ahead of us.
Helping to Navigate the People Risks
As a team, we've mobilized quickly to try and offer real support that is based on three key time horizons. This allows us to place some structure around the ambiguity.
1. Crisis management
What we do in the next 30 days will be crucial. How do we ensure that people are safe? Consider what they need for wellness in its broadest sense: physical health, mental health, family, stress and coping with ambiguity, right the way through to financial security. Hopefully, these will instill some calm.
As a firm, we are trying to accomplish some real tactical support and advice - making it as easy as possible for you to access these and keep the cadence going. This will allow you to leverage Aon's considerable assets.
The challenge is not going to pass in days or even weeks. It will be hard to focus on everything else.
Right now, we need to focus on keeping jobs intact and supply chains running. However, we also need to keep one eye on recovery. Or maybe the aftershocks - we're starting to worry that there may be unintended consequences or further outbreaks. We'll use a mixture of experience, data, pulse surveys, conversations and modeling in order to inform and advise around what we think you can do and how.
We'll keep a regular cadence of this going because we think it's going to evolve quickly. Indeed, over the first few days, we’ve learned that things are changing incredibly quickly.
3. Adapting to the new normal
We are looking at how to adapt to the new normal. People just cannot focus on that now. Rest assured, we have a team focused solely on that. They are considering how you will: adapt to the new reality; avoid making past mistakes; cope with potential ramp ups; deal with the new economic reality; build agility and resilience; and avoid future events and get yourself ready for that.
The new normal is not going to look the same way as it did just a few weeks ago.
Source of Practical Advice
We offer support and observations of what is happening in the West and what has happened over the last four or five months in countries such as China that are a little further along. We want to avoid the obvious and concentrate on facts that provide leaders the confidence to act quickly.
Most firms are choosing to monitor and plan rather than pivot immediately. We believe that moving quickly is going to be essential. Therefore, our frameworks try and give some structure to how you deal with those challenges, while keeping people calm. We've categorized it into large broad groups.
Protection and communication
A few illustrative examples:
Working from home - During the first week, we saw 70% of head office staff working from home. That is incredible. When we saw this in China, it took a while to get to 80% (in the affected areas). We are now seeing a reversal of that where they've been through the peak of the virus, coming through the other side. There are currently 60-70% of workers back in the office.
Communications - It’s important that there's more communication. Try and get coordinated quickly, otherwise you'll end up with conflicting messages and people will become fatigued due to constant stream of white noise. In China, they use tools like WeChat, which are networks that actually blend people's home life with work life. These were pretty appropriate given the current situation, but that is not the situation in the West. There's quite a clear demarcation and we're going to have to think about how to adapt to that.
Re-emphasizing available benefits - Most companies have been reminding their employees about the significant benefits that they offer and really trying to help them navigate what is available and we do encourage firms to do that. There's lots of great tools out there. More than 30% of companies have increased sick leave.
Cashflow and cost management
Governments are now intervening in how to support and encourage furloughs rather than layoffs. We have recently undertaken a survey with already around 2,000 reponses from North America and Europe and we see that:
• 22% of firms have implemented a hiring freeze.
• 60% of companies are considering a hiring freeze.
• Only about 155 of firms are downsizing.
However, I would emphasize that this depends on which industry you're in; aviation is in a different situation than financial services or manufacturing.
• 12% freezing or postponing salary increases - maybe for 60 or 90 days.
I believe we'll see more of that, but potentially, for some firms, it's too late.
Where hiring is essential, many are deploying online assessments. What we are seeing is people struggling a little with the onboarding. Therefore, even if you can find the right candidates, can you get them active and productive quickly enough? Again, we have lots of insights on how you can improve this.
• 40% of companies are reviewing sales incentives.
• 4% or 5% of companies have already made a change to sales incentives.
We fully anticipate more change in the coming weeks.
Redeploy staff and supporting pivotal roles
Lots of companies are looking to redeploy staff and are looking at the phasing. They are wondering what can they do now that will save time later (when there is hopefully a ramp up).
Also focusing on pivotal roles, what can they do to really get their shoulder behind those people or roles, fully supporting them with employees in other parts of the organization who are not fully deployed.
Recovery and Impact on the Strategy
It's really too early to tell. People don't want to talk about this. However, rest assured that we are beginning to think about that. As people are coming back into the workplace in China, predictions suggest 75% of companies are looking at between flat and 30% negative growth. We don't know whether that's going to become worse. It's a bit too early to tell, but we will keep an eye on developments.
So, hopefully, this will give you a feel that we're a good place to come to for real tangible advice and a source of benchmark information. We have set up a series of webinars, interviews and surveys.
We'll publish a roadmap and really continue to evolve this. I hope that it is useful for you and your organizations to really give people a feel that we're covering the short term but we're now keeping an eye on the medium and long terms.
We'll have a regular dialogue of communication, which will be vital as events unfold.
I cannot stress enough that this is going to look very different for different sectors and geographies.
We have a lot of specialists in our organization and we understand that your industries and locations are different. Government reactions will all be different. We are pooling all these resources as there are things to learn from each of those sectors and geographies.
Please reach out to your Aon contact for further details - and stay tuned and stay safe.
Disclaimer: This document has been provided as an informational resource for Aon clients and business partners. It is intended to provide general guidance on potential exposures, and is not intended to provide medical advice or address medical concerns or specific risk circumstances. Due to the dynamic nature of infectious diseases, Aon cannot be held liable for the guidance provided. We strongly encourage visitors to seek additional safety, medical and epidemiological information from credible sources, such as the Centers for Disease Control and Prevention and the World Health Organization. As regards insurance coverage questions, whether coverage applies or a policy will respond to any risk or circumstance is subject to the specific terms and conditions of the insurance policies and contracts at issue and underwriter determinations.
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