Episode 387

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There’s no denying that when the pandemic hit, the workforce changed forever. We experienced some of the most rapid shifts in our economy and lifestyles this century, and we still feel its effects today.

Most notably, our work standards morphed along with how we view leadership and hustle culture. The old ways of working longer hours and devoting yourself to a company to climb your way to the top have dissolved.

This week, Heather McGowan is joining me to talk about the major shifts we’ve recently experienced and will shed some light on how agency owners can adapt to better fit the new roles employees expect leadership to fill. She’ll talk about “The Five Greats” that led to these intense shifts, and four leadership adaptations agency owners should consider making to support the new-age workforce best.

A big thank you to our podcast’s presenting sponsor, White Label IQ. They’re an amazing resource for agencies who want to outsource their design, dev, or PPC work at wholesale prices. Check out their special offer (10 free hours!) for podcast listeners here.

What You Will Learn in This Episode:

  • How Heather accidentally became an expert in human work culture
  • “The Five Greats” that collided all at once to shift the workforce
  • How to change the mindset around hustle culture and where it still has its place
  • Four shifts an agency owner needs to make to align themselves with the current workforce
  • Moving from competition to collaboration to motivate your workforce
  • Polling your workers and being open to feedback as you make changes
  • How agencies are successfully building a remote culture
  • What are the new standards of effective leadership today?

“Not only are you building the performance of your organization, but you also have an impact on today's society, and you may be impacting the next generation of workforce.” @heathermcgowan Share on X
“Rather than pitting people against each other, you make it really clear you're supportive of what happens in the team as opposed to individuals against each other.” @heathermcgowan Share on X
“This is our opportunity to humanize the work and make it more of something we all want to engage in so we have higher levels of engagement and happiness.” @heathermcgowan Share on X
“You have to create effectiveness through inspiration, which means caring about your people, loving your people, and creating belonging.” @heathermcgowan Share on X
“The workforce is empowered because of five “Greats”: The Great Resignation, The Great Retirement, The Great Reshuffle, The Great Refusal, and The Great Relocation, and it is all happening at once.” @heathermcgowan Share on X

Ways to contact Heather:

Resources:



Speaker 1:

Welcome to the Agency Management Institute Community where you’ll learn how to grow and scale your business, attract and retain the best talent, make more money, and keep more of what you make. The Build a Better Agency podcast presented by White Label IQ is packed with insights on how small to mid-sized agencies survive and thrive in today’s market. Bringing his 25 plus years of experience, as both an agency owner and agency consultant, please welcome your host, Drew McClellan.

Drew McClellan:

Hey, everybody. Drew McClellan here from Agency Management Institute back with another episode of Build a Better Agency. Super excited to be back with you this week. Thanks for coming back. If you are not a new listener, and welcome. This is a great episode to join us if you are a new listener.

So, a couple of quick things before I tell you a little bit about our guest. Number one, I want to remind all of you that we have some great workshops, some AE boot camps coming up. The Advanced AE boot camp is at the end of March and the regular AE boot camp is at the end of April. Both of those are in Denver, Colorado, so head over to the website and check those out. We won’t run them again until September and October, so grab a seat while you can. We always love to see your people and help them be successful and support your goals, so love to see them.

Also, I want to remind you that, of course, the Build a Better Agency Summit is May 16th and 17th. Getting really excited about it. It’s falling into shape in a lovely way. Really wonderful sponsors, great speakers, and the attendees are going to be off the charts and we want you to be one of them. We will sell out, so please grab a ticket while they are still available and go to the website at Build a Better Agency… Sorry, I lied. Go to the website at agencymanagementinstitute.com and then in the upper left, you’ll see BaBA Summit. Click on that and you can click on the registration button to buy your tickets before they either sell out or get more expensive. So, grab them today if you can.

One of the speakers that’s going to be there is a woman named Jamie Roberts. And Jamie owns a company that helps agencies recruit and sort of assess before they hire creative talent to make sure that they are the right creative talent for your shop. So, it’s not all about their book, it’s not all about the awards they’ve won, but they have to fit your shop’s culture, work, work style, and she has a really interesting methodology for figuring that out. So, she’s going to be there talking to us about that methodology, so how we can hire the creative department better and we can attract people who are going to be longtime great producing employees. So, come out to the summit and check that out and she’ll be one of the breakout sessions, so you’re going to love her. She’s also really lovely, but super smart and you’re going to love learning from her.

All right, let me tell you a little bit about our guest. So, Heather McGowan is a fascinating woman who has been studying basically human work and how we work and how we work together for a long time. And she has written a great new book that is coming out, actually, it came out yesterday when you’re listening to this, if you’re listening to it live on March 6th. The book came out on the 5th, and it’s really all about how we have to change our work environment and culture to attract and keep and retain and get the most value out of today’s employees.

And I know for a lot of you, you’ve been struggling with this. It would be really great if you were to check out the book, but this next hour is going to be an amazing preview. So, Heather is going to download for us all the ways that the workplace has changed and we’re feeling a lot of them, but she’s going to talk about why they’ve changed. And what we can do to get the most out of that workforce and what we have to do as leaders and owners to really embrace some of these changes and to make our work environment something that people are really drawn to. So, without further ado, let’s get to this conversation because I’m really excited to learn from her and I think you’re going to love this conversation.

Heather, welcome to the podcast. Thanks for joining us.

Heather McGowan:

Hi, Drew. Thanks so much for having me.

Drew McClellan:

So, give everybody a sense of your background and how you came to have the expertise that you have and what led you to writing the book.

Heather McGowan:

Complete and total accident. That’s the honest answer.

Drew McClellan:

Well, you know what, everybody listening for the most part is an accidental business owner, so they understand. Yeah.

Heather McGowan:

Yeah. If you’re looking at your career and say, “I don’t know it was an accident,” share that story with young people, who are so trying to tightly define their future when it has never been moving more quickly or with greater ambiguity.

Drew McClellan:

When they’re 18 and they’re supposed to know what they want to do for the rest of their life.

Heather McGowan:

When their prefrontal cortex hasn’t even fully formed and they can’t even make those decisions.

Drew McClellan:

That’s right. So, how did you accidentally become the expert that you are?

Heather McGowan:

Yeah, I know, so I used the title Future Work Strategist. It was coming out of the reality that I had been doing speaking and writing, and people kept saying to me, “Well, how do I introduce you? What do I call you?” And so, a friend of mine went on one of those websites. It was like pick something from Column A, Column B, Column C and came up with this term future work strategist. Now, I look on LinkedIn and other people are calling themselves that as well. It’s a completely made up title.

It came from the fact that I was trying to knit together some dots that I think should have been connected. I had worked on the demand side and the supplies side of human talent. And I have an undergraduate degree from RISD in Industrial Design and MBA from Babson in Entrepreneurship. I’ve worked in everything from product design, design strategy, boutique investment banking, academia. So, I had worked in this all these different functional areas and I think now looking back on it, I was just trying to understand what humans do at work.

And along the way, I discovered we were not creating the workforce we needed, so I would spend about a decade in academia. I built a new college focused on innovation. I built a curriculum for the future of work. Done a variety of things like that. And then on the demand side, I was working in white space exploration and product design and realizing we didn’t have humans geared towards the exploratory work we needed them to do. And so, I started explaining it both to my academic clients and my corporate clients, and then it spun off and became its own thing. I’ve written a couple of books on it and I speak about 75 engagements a year for companies all over the world trying to explain to them really the now of work, what’s happening, and how they should better prepare for the moment they’re in.

Drew McClellan:

And so, then the world turned upside down and you were like, “Oh, my gosh, this is my moment. I can help people figure this out.”

Heather McGowan:

I had written a book that I took a long time to find a publisher and an audience called The Adaptation Advantage: Let Go, Learn Fast, and Thrive in the Future Work. That came out April 2020 when we were in the height of our chaos and it ended up being sort of an accidental guidebook of how to get through the pandemic, even though I knew I did not know that I eerily precedent.

And then I remember talking to a friend of mine who had run an agency most of his life, and I said, “Ed,” Ed, if you’re listening, talking to you, “Ed, what the hell am I going to do? I mean, I basically spit on people for a living. I mean the respiratory droplets business, it’s all shut down.” He’s like, “You’re going to sit back, you’re going to watch, you’re going to pay attention. You’re going to connect the dots. You’re going to come out of this with greater insights, another book and a whole another leg you’re speaking to.”

And he was absolutely right. The book that we wrote that comes out March 5th is called The Empathy Advantage: Leading the Empowered Workforce. It’s really your Guide to the zeitgeist. And we wrote, Chris Shipley and I wrote it in about 100 days because after three years of giving a couple of hundred talks to companies and working with companies and seeing what they were all struggling with, I was like, “Whoa, the zeitgeist has changed and they need a guide.” And so, we just wrote it to meet the moment I think folks need right now.

Drew McClellan:

Our clients, our listeners, they have been, my gosh, they’ve been struggling so much. During the Pandemic, as you know, it was about how do they keep their employees calm and focused and feeling safe and completely changing the way we worked in terms of how we worked, where we worked, how we communicated. A lot of agency owners for the first time we’re dealing with a lot of stress and mental health issues that for the first time, their employees were much more bold about talking about, or they were so profound they couldn’t hide them anymore.

And then as we were coming out of the heart of the pandemic trying to find talent. I mean, agencies were hiring anybody who could string together a sentence and was still breathing and upright and then struggling with what is putting somebody who’s the wrong person or the wrong fit into an environment and what does that do with the culture. And now, I think there’s been a lot of course correction around that, but still what employees want today and how they want to work, and all of that is unprecedented for most of the people listening to this podcast.

And it’s not that they don’t want to be great employers, and it’s not that they don’t care about their people, they literally are, they look at me and they go, “Drew, what the hell? Like I don’t know what to do anymore. I used to know what to do and now, I don’t know.” So, is that common with what you’re seeing?

Heather McGowan:

Yeah, yeah, yeah, 100%. So, what’s happening is if you are a leader today, an agency owner, you were trained in a certain environment with a certain set of expectations. That have fundamentally evaporated, and you’re looking for your people to respond the way you responded to leadership that led you, and I’m sorry, it’s simply not going to work. So, you were trained to be an unquestioned expert to make decisions on certainty, to lead your folks sometimes a little bit of domination or fear or sometimes even humiliation. You used extrinsic motivational pressures like punishment, threats and rewards. You called the shots. People worked for you.

That’s not how it operates anymore because we’ve gone through a fundamental transformation on how the relationship between individuals and organizations. We once traded loyalty for security. That security started to evaporate and then it became an existential crisis in the pandemic. And folks were saying, “I don’t want to do this anymore. What am I doing with my life?” And they want to work for other reasons. We once worked for our survival, then identity and status. And now it’s “I want values, I want purpose, I want lifestyle, I want meaning.”

And the workforce is empowered and the workforce is empowered because of five greats, the great resignation, the great retirement, the great reshuffle, the great refusal and the great relocation and all happening at once. The great resignation was initially purely understood. People thought it was a phenomenon between 2021 and 2022 until they saw in 2022, more people quit than in 2021.

Drew McClellan:

So, they thought it was really just a symptom of COVID, right?

Heather McGowan:

Yeah. And then you look back and it started in 2009. That’s when quit rates started to increase. And so, why did they start to increase? They started to increase because it was no longer required that you spend X number of years with an organization. That is no longer a pressure or a conventional wisdom. It started to accelerate even more with 15 years of digital disruption and job creation. Job destruction was happening at such a rapid rate in terms of what skills were required, how humans worked together, that jobs were just morphing and changing.

And then you’ve got a series of other pressures where folks were saying, “I’m just not doing this anymore. I’m going to do something that fits my lifestyle better.” So, you got the greatest resignation. And Gardner thinks that’s going to be up 20% going forward because we have labor shortages. And one of the reasons we have labor shortages is the boomers are leaving the workforce or starting to leave the workforce. Not all of them, and I’m not saying they should. I think we need to think of better ways of engaging folks throughout the lifespan, but 75 million boomers are going to turn 65 between now and 2030 and leave the workforce. We should have been prepared for that.

The great reshuffle or reskilling is when folks say, “Listen, I don’t want to do this kind of work anymore. I don’t want to be in the travel industry, or I don’t want to be in IT, or I don’t want to be a teacher or a nurse,” what have you. And we have real shortages in some areas of the workforce. 53% of people who moved between ’20 and ’21 went to different occupations. I mean, that’s a profound shit in the workforce.

Drew McClellan:

Yeah. It’s crazy. Right, right.

Heather McGowan:

The great refusal is on two fronts. It’s folks who are at entry wage saying, “I’m not getting punched in the face for $7.25 an hour anymore. You can’t humiliate me. I’m not doing it.” Way behind on paying people fairly. If we had kept to pre-pandemic inflation, we’d be looking at about $23 an hour for minimum wage. We’re way off that. And then working parents, and particularly, moms, working just to pay for childcare, after you’ve been through an existential crisis, I don’t think so. So, we’re seeing a lower labor force participation rate with one.

And then the great relocation is 19 million people according to Upwork saying, “You know what? I’ve always wanted to live in Denver, Colorado or Gulfport, Florida or the Colorado Rockies or Manhattan,” or whatever it may be. “And I’m going to go to that location and then figure out how to work because there’s greater ability of remote and hybrid work, or I’m just going to be in gig work and figure it out.” So, those combined forces give out some great reset. Your workforce is empowered. No more mandates and dictates. You need to listen to them and engage them, but if you do, I think this is a tremendous opportunity.

Drew McClellan:

There’s the silver lining to all of that because that was all sounding horrible.

Heather McGowan:

Yeah, yeah. No, but if you look at what we’ve been doing over the last couple of decades, we’ve got unprecedented level of burnout, mental health issues, and Gardner’s been tracking engagement for 20 years. We’ve made almost no progress. This is our opportunity to humanize the work and to make it more of something that we all want to engage in. So, we have higher levels of engagement and happiness,

Drew McClellan:

Which also does increase loyalty and make people want to stick around.

Heather McGowan:

100%. I mean, the companies that are on the best places to work list actually have higher performance. So, it’s not success that will make you happy. If you’re happy, you’ll be successful. We’ve been a little backwards on that.

Drew McClellan:

So, somebody has owned their business for 20 or 30 years, like you said, A, they grew up in the workforce in a very different way. I was talking to somebody who was in her early 50s, and she was like, “In our business particularly, everybody wanted to work at an agency. It was a very sought after job and so, you had to prove you wanted it. And the way you proved you wanted it was you worked long hours and you worked nights and weekends and you worked, whatever.” And she was like, “You just knew that you were going to pay your dues for X number of years before you were credible and all, you got promoted, and all the things.”

And she was like, “Now, 5:00, 4:30, whatever the quit time is,” she’s like, “my folks are out, and there is none of that.” And she’s like, “I get that that’s healthier and better for them. I do. I wouldn’t wish what I went through on anybody, but I built my business based on that model.”

Heather McGowan:

That model.

Drew McClellan:

Right?

Heather McGowan:

Yeah.

Drew McClellan:

So, how do I change that model?

Heather McGowan:

Yeah, I talk to law firms and accounting firms, it’s the same thing. How do you become partner? It’s a sacrifice privilege. There will be some people who still buy into that hustle culture and maybe there’ll be enough of them to keep the partner track running and keep the agency model going and the accounting model of billing, 150% of the hours you actually have in a day. But there’s a lot of folks who were saying, “You know what, I don’t think the quality of my work is that good when I’m ground to a stump.”

Drew McClellan:

That’s right.

Heather McGowan:

So, there’s that piece of it as well. I mean, I think we’re going to see this shake out in some interesting ways. I don’t think we’re going to see the end of hustle culture for everything. We’re going to have hustle culture put back in the place. Hustle culture should be when there’s a tremendous opportunity and I am dying to get it done because I want to get to the market or to the client before anybody else, or I’m scaling a startup. It’s not every day all the time, which is what it turned into.

Drew McClellan:

That’s right. And I will say I do think our industry has seen that, that we know this week is going to be a grind week. We’ve got a big RFP due. This is a huge opportunity for us. People will rise to that occasion. So, and I also think-

Heather McGowan:

And then it becomes, what do you do the next week to make sure if they’ve just drained the gas out of the tank or the battery, how do you help them recharge the next week? It’s not, “Okay, now this is just another week.” We have to think about