| This week, we look at which managers are putting the “well” in well-being. Plus, how many people are really needed for an effective transformation, and a quick primer on FinOps. |
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| All together now. Over the course of the COVID-19 pandemic, we’ve seen that social cohesion matters everywhere, from countries to cities to companies. Entities that are more cohesive (and focus on emotional and physical well-being) can weather tough times better, research shows. In the workplace, who is focusing on connection and well-being? |
| Women leaders, that’s who. The Women in the Workplace 2021 report, from McKinsey and LeanIn.Org, offers up a spectrum of findings on how women are faring in corporate America. Gleaned from input by more than 400 organizations that employ 12 million people (and surveys of more than 65,000 employees on their workplace experiences), it’s the first in the series to include a full year’s worth of findings during the pandemic. The data show that women in corporate America are even more burned out than they were last year—and increasingly more so than men. Despite this disparity, women leaders are doing more than men at the same level to support employees. |
| Teamwork matters. Women leaders are helping team members navigate work/life challenges, ensuring that their workloads are manageable, and checking in on their overall well-being. Women leaders also spend more time than men on work related to diversity, equity, and inclusion that falls outside their formal job responsibilities, such as supporting employees’ resource groups and recruiting employees from underrepresented groups. And senior-level women are twice as likely as senior-level men to dedicate time to these tasks, the findings show. An exhibit from the report tells the tale. |
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| Vital skills. You may be thinking, “That’s excellent, but is team well-being essential as a bottom-line business matter?” The answer is absolutely. McKinsey research has found that organizations that create strong, supportive cultures attract and retain the best people. Companies that fixate only on profits will lose ground to organizations that create a strong identity that meets employees’ needs for affiliation, social cohesion, purpose, and meaning. |
| In demand. Over the longer horizon, as we look at what skills will be needed in the future as automation, AI, and robotics take hold, McKinsey research shows that more employers are emphasizing social and emotional skills, in addition to decision-making and statistical abilities. Perhaps it’s time to retire that old trope that empathy skills, typically associated with women, are a hindrance to leading well. |
| Concrete steps. The problem remains that the women who do this extra work are not getting recognized for it. Companies have to impress upon managers that supporting employee well-being is critical to the health and success of the business. For this work to feel like a real priority, it should be tied to concrete outcomes, including performance ratings and compensation, for managers. Companies already tie comp to a variety of goals. Why not consider adding this essential one to the list? |
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| PODCAST |
| A vehicle for sustainable delivery |
| If you’ve noticed more delivery trucks crowding city streets these days, you’re not alone. As the shift to online shopping continues, commercial trucks are being kept busy, but they are also becoming a major source of the emissions and pollutants that contribute to global warming. Carl-Magnus Norden is trying to change that through Volta Trucks, an electric-truck manufacturer based in France, Sweden, and the UK. The company has developed Volta Zero, a fully electric commercial truck designed for freight distribution in city centers. Norden’s goal, which he discusses in this episode of the McKinsey on Start-ups podcast, is to improve not only the sustainability of cities but also the safety of their streets. |
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| TECH FOR EXECS |
| FinOps: ‘Moneyball’ for the cloud |
| Our experts serve up a periodic look at the technology concepts leaders need to understand to help their organizations grow and thrive in the digital age. |
| What it is. FinOps (financial operations) is not a technology, but it’s one of the most important recent developments in the management of tech. Born out of the cloud revolution, FinOps is a new way to continuously optimize costs for applications on the cloud, where companies consume tech resources as they need them. It brings together technical, financial, and sourcing professionals under one roof. This group translates the consumption needs of a business into optimal cloud offerings and pricing arrangements, oversees and makes fast decisions on resource allocation and cloud usage, and tracks enterprise-wide cloud spend to ensure financial discipline. |
| Why we need it. The benefits of cloud—scale at your fingertips, instant access to hardware and software, paying only for usage—have drastically reduced friction in application development and usage. However, high variability in cloud usage, a growing range of cloud offerings and pricing arrangements, and outdated managerial processes that are geared to control hardware costs rather than optimize usage volume create much greater cost complexity, which can lead to cloud spend quickly spiraling out of control. In fact, 80 percent of companies find managing cloud costs a major challenge. FinOps differs from existing cost-management functions in IT by helping organizations make better decisions about which services and specifications are needed, when they’re needed, and for how long they’re needed, reducing cloud-usage costs by as much as 15 to 20 percent. |
| How good FinOps works. We’ve seen companies have great success in optimizing their cloud costs when FinOps includes three key practices: establishing granular visibility into cloud-consumption patterns to monitor and track cloud spend, developing an analytic and governance model to forecast consumption based on business and technical drivers, and shifting mindsets from managing hardware costs to optimizing usage in order to match demand with the cloud services and pricing arrangements that fit best. (Our cloud-cost simulator tracks costs for compute, storage, network, and database.) Optimizing costs in the cloud is a full-contact sport requiring continuous adjustments. Do you know how much you’re spending on cloud on a daily or weekly basis? Asking your CIO is a good place to start. |
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| — Edited by Barbara Tierney |
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