Clash of models

Cristina Simón. Professor. Instituto de Empresa

24 October 2003

Do tough times - and an economic climate that makes redundancy almost inevitable at least once in one’s career – mean employees can no longer enjoy satisfactory relationships with their organizations?

One of the many advantages of being a professor in a business school is the fact that each academic year offers us the chance to analyze the way a new generation of professionals views the world. As a colleague remarked, “Every year you’re one year older, but they never age”. This makes us privileged observers of the evolution of models professionals use to assess the business environment in which they move.

I fear the current panorama is not very encouraging. Our students view the relationship with their firms from a skeptical, disillusioned standpoint. The bitter tone of their comments is rather worrying, since this sphere occupies practically half the 24 hours in their daily lives.

What can possibly be going on? Are we employees condemned to maintaining a poor relationship with our professional milieu? The tough labor market situation nowadays undoubtedly exercises a negative effect on our perception: if there are no other opportunities on the horizon, many employees feel like hostages within their companies, which cast the shadow of redundancies and benefit reductions to shield themselves from even more aggressive shifts in the market.

In fact, as Cascio pointed out (2002), the latest waves of layoffs are not due to real reverses in firms’ financial performance, but are instead attempts to generate positive expectations to sustain market confidence. In this case, what is left by the wayside is employee confidence, since workers see themselves as a resource that is top of the list when something has to go, just as a precautionary measure. It’s determinism, when all is said and done: our professional fate no longer lies in our hands.

[*D As professionals, we expect a certain degree of stability which allows us to establish a long-term relationship with the company *]

Recent demographic analyses however are bringing good news on this front. A study last year by Watson Wyatt, looking at the relation between the demographic evolution in our country and labor market conditions, concluded that 2007 will see full employment, due to new arrivals on the job market - the generation that has experienced a huge drop in the birthrate.

Yet there remains an underlying dilemma that may cause this feeling of malaise with the company to persist - even when the economic cycle and labor market improve. This problem arises from the traditional view held in our culture, with regard to what we, as employees, should receive and what companies are in a position to offer.

As professionals, we expect, above all, a certain degree of stability which allows us to establish a long-term relationship with the company. Any hint of flexibility in contracting or dissociating certain professionals is interpreted as betraying the loyalty that employees deposit in the organization. It is the search for constancy in our personal situation that we have experienced in Europe for so long now: the firm keeps a more or less implicit commitment to stability, and employees do not consider leaving unless some internal conflict arises that could justify it.

Compare this with the American labor market - the leader in globalization processes and thus the reference for our future forecasts. One basic point is important: statistics show that every worker is dismissed at least once during their professional careers. How do you tackle your career with such a prospect? Obviously, employees cannot define loyalty with the same parameters. Their vision of permanence within the company revolves around acquiring experience and knowledge skills that best prepare them for their more-than-likely return to the job market. Moreover, professionals also actively seek other job opportunities and are ever aware of alternative openings, particularly in their years of highest employability. Leaving a job is accompanied by stress, yet it does not entail such an emphatically negative social or emotional connotation as in our social context.

It is not at all clear that Europe will end up producing the same statistics as North America, at least in the medium term. However, it is worth considering employees’ approach to their relationship with the company, if we wish to pursue a more serene and balanced view of our lives. It is evident that mutual loyalty is bound to increasingly lose significance as a principle of the employee-company relationship. But this should not lead to professionals holding a bitter view of their firms. We must simply separate the criterion of career success from permanence and regular hierarchical promotion within an organization. The new approach envisages people who pursue permanent personal development, part of which may only be obtained through cycles of service in a range of different companies.

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