Corporate America has a problem.
Unless it can resolve the crisis of confidence among its employees, it has
no hope of restoring the trust and confidence of investors that are so critical
in these economic times. And if a company can't win its employees’
trust, how can it expect to win the trust of investors? Employees are, after
all, companies’ most visible ambassadors to the outside world.
The crisis in confidence is not surprising
given the economic instability of the past
several years and the rash of corporate scandals.
Layoffs, pay freezes, forced vacations,
accounting scandals, insider trading, rising
health care costs, reduced benefits, underwater
stock options and relentless change
have shaken both employees’ and investors’
faith in the ability of companies to thrive.
New data from the Watson Wyatt WorkUSA®
2002 study underscore the severity of the
problem. According to the study, a majority
of U.S. employees:
- lack confidence in senior management at
their companies
- are unclear about the link between their
jobs and their companies’ objectives
- rate their companies poorly when it
comes to managing business change
No company can afford to ignore these issues.
Three-year total returns to shareholders (TRS)
rates are significantly higher at companies
with high trust levels, clear linkages between
jobs and objectives, and employees who believe
the company manages change well. Consequently,
failure to address the confidence
problem may result in lower shareholder
returns — an untenable outcome for companies
struggling to improve investor relationships.
The WorkUSA® 2002 study results provide
companies with a blueprint for responding to
this crisis in confidence. To restore employee
trust, the first step is knowing — and understanding
— exactly what employees think.
Armed with this information, companies
can work to restore the employee — and
investor — confidence necessary to successfully
compete in an uncertain economic
environment.
