CEOs tighten grip on workplace culture, dialing back flexibility
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American CEOs are looking to reset workplace culture — emphasizing productivity and speed over flexibility and work-life balance.
Why it matters: This is putting employees on guard, with some feeling like a more hardcore culture is not what they signed up for.
Driving the news: AT&T CEO John Stankey and Cognition CEO Scott Wu made headlines this week for notifying employees that their corporate cultures were changing, and to get on board or exit.
- "If a self-directed, virtual, or hybrid work schedule is essential for you to manage your career aspirations and life challenges, you will have a difficult time aligning your priorities with those of the company and the culture we aim to establish," Stankey wrote in an internal memo obtained by Business Insider.
- Employees at Cognition were told that six days in the office and 80-hour workweeks were expected, per The Information. "We don't believe in work-life balance—building the future of software engineering is a mission we all care so deeply about that we couldn't possibly separate the two," Wu wrote.
Between the lines: "To some extent, this tough talk from CEOs is based on an undercurrent of fear," says Glassdoor chief economist Daniel Zhao.
- "I think CEOs are worried about the economy. They're worried about AI coming to eat everybody's lunch. And so why are CEOs pushing so hard to get more efficient, get more productive? It's because they recognize the risk that AI poses to their businesses, and that's why so many of them are pushing so hard in this moment," he added.
The big picture: CEOs across industries are embracing the "Big Boss Era," which has been underscored by mass layoffs, return-to-office mandates or diversity, equity and inclusion walk-backs.
- Plus, macro factors like the softening job market and the threat of AI taking the jobs that are left, have put employees on their back foot.
What they're saying: Deprioritizing employee well-being could backfire and hurt a company's performance or ability to attract talent, says Indeed senior talent strategy advisor Kyle M.K.
- "Although the employees may not be calling the shots like they maybe were back in 2022, they are still obviously a gigantic part of how a business functions and how they perform. And if they don't feel like they're being taken care of, I fear that the business won't be taken care of as a result."
Zoom in: Return to office continues to be one of the biggest sticking points.
- Nearly half of workers say they are unlikely to stay at their job if required to go back into the office full time, according to a recent Pew Research poll.
- If given the choice, a majority (72%) say they'd choose a hybrid arrangement.
Yes, but: If change is coming, then transparency from leadership is expected.
- "Leaders should be upfront about their culture," says Zhao. "If you are going to create a culture that prioritizes grinding over work-life balance, that should be something you make clear to applicants and to your employees."
- "You should expect push back, but I do think it is important for leaders to be transparent about the culture that they're trying to build, especially if that culture is more aggressive than what you might find elsewhere," he added.
Plus, as Seven Letter partner Mike Ricci previously pointed out, there's a case to be made for strategically leaking internal memos about the shifts to more hardcore work cultures because it can send a strong signal to board members, investors or stakeholders in Washington.
What to watch: Most companies are undergoing a major transformation, whether it's related to business operations, trade or AI.
- It's common for company cultures to shift during these moments, changing how they talk about themselves to their key audiences.
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