We are approaching 20,000 members in the United States and over 1700 are in Texas. As an Austin business owner, CEO or president of a small to mid size business enterprise is now the time to investigate the added value of being in a peer advisory group? You don’t have to go it alone. We provide you a safe, open, honest monthly opportunity in sharpening your saw as a leader with a private coaching session and a full day with a dozen or more like-minded leaders working on being a better leader making better decisions.

Anne Petrik

September 7, 2022

While inflationary pressures persist, small businesses report that the supply chain is improving, and their hiring plans remain stable. All of these things lead to a more favorable view of the economy, which was evidenced by the improvement in small business confidence in August. In fact, the 6.9% increase in WSJ/Vistage Small Business CEO Confidence Index was the largest gain in 18 months. The most significant driver in the increase of the Index was improving sentiment about the future of the U.S. economy among small businesses, which improved 33% from last month despite persistent inflationary pressures.

Inflation persists while the supply chain continues to ease

Inflationary pressures are not easing. In fact, the numbers rose incrementally from last month with wages and compensation continuing to be the top impact small businesses are facing. The easing of the supply chain may be a key driver as the improving trend continues from last month with 50% of small businesses reporting that the supply chain is slowly getting better, a 5-point increase from July. More significant is the proportion of small businesses reporting that their supply chain is worsening, which posted a 7-point decline, dropping to just 13%.

Hiring remains critical for operations

As all eyes are on hiring based on the importance of the labor market to keep the U.S. out of a recession, small businesses continue to show optimism. With 315,000 jobs added in August, small businesses were among those adding to that figure with more than half (52%) planning to increase their workforce in the next 12 months, the same percentage as last month. The economy has impacted hiring plans for very few, with the majority of small businesses hiring the same number as planned at the beginning of the year (70%) and some hiring more than originally planned (13%). Just 17% of small businesses are hiring less than planned, and only 7% are planning to decrease the size of their workforce in the next 12 months.

Filling job openings still presents a challenge for small businesses. Currently, 57% of small businesses report operational challenges as a result of a talent shortage. While that is an improvement from 72% in January, this is the foundation for why hiring plans remain strong.

When asked about whether it was easier or more difficult to fill openings than at the beginning of the year, 56% report no change. Because hiring was a challenge at the beginning of the year, the “no change” response indicates that it remains challenging. Adding to that, 27% of small businesses report that it is harder to fill job openings than at the beginning of the year. With the latest jobs report indicating a slowdown in jobs created and more people entering the workforce, small businesses may soon find it easier to fill roles.

Flexible scheduling options are a key part of hiring strategies

Small businesses continue to innovate how they approach hiring as the workforce revolution has put employees in the driver’s seat. While small businesses continue to boost wages (77%) and add benefits (39%) to remain competitive, small businesses look to other components to differentiate themselves as well. Flexible work options remain a carrot, with 62% offering flexible hours and schedules and 60% offering remote work options. In fact, over the past 3 months, 18% of small businesses have increased flexible scheduling and 16% increased remote working. Other strategies were shared in a recent roundtable where Vistage members shared their hiring best practices.

Overall the increase of optimism among the small businesses surveyed monthly through the WSJ/Vistage Small Business CEO Confidence Index survey is likely an indicator that we can expect to see improving sentiment from the larger population of small and midsize businesses. Opinions collected in Q3 Vistage CEO Confidence Index will reflect a greater scope of how this vital sector of the economy feels and may be a harbinger of improvements ahead.

August Highlights:

• Inflationary pressures persist with incremental gains from last month.
• The WSJ/Vistage Small Business CEO Confidence Index grew 6.9%, the highest increase in 18 months.
• Economic sentiment improves; 23% improvement in the perception of the current economy and 33% improvement in the future economic conditions.

Download the August report for complete data and analysis

For a complete dataset and analysis of the August WSJ/Vistage CEO Confidence Index survey from the University of Michigan’s Dr. Richard Curtin, download the report and infographic:

DOWNLOAD AUGUST 2022 WSJ/VISTAGE SMALL BUSINESS REPORT

DOWNLOAD AUGUST 2022 WSJ/VISTAGE SMALL BUSINESS INFOGRAPHIC

About the WSJ/Vistage Small Business CEO Survey

Interactive data from WSJ/Vistage Small Business survey

The August WSJ/Vistage Small Business CEO survey was conducted August 8-15, 2022, and gathered 566 responses from CEOs and leaders of small businesses with revenues between $1 million and $20 million. Our next survey will be in the field September 7-14, 2022.

Related Resources 

The CEO Pulse: Hiring Resource Center

The CEO Pulse: Inflation Resource Center

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Category: Economic / Future Trends

Tags:  Hiring and Retention, inflation, WSJ Vistage Small Business CEO Survey

About the Author: Anne Petrik

As Vice President of Research for Vistage, Anne Petrik is instrumental in the creation of original thought leadership designed to inform the decision-making of CEOs of small and midsize businesses.

Austinite Maura Thomas shares another meaningful blog for her readership. She’s an accomplished keynote speaker, Tedx, Vistage Speaker, past member and a personal friend. It’s less than a 7 minute read.

This post was updated August 27, 2022

Company culture is often the biggest impediment to employee progress and productivity.

Researchers at Harvard who studied creative work inside organizations discovered that progress is a critical source of motivation for employees. They called this “the progress principle.” It states, “Of all the things that can boost emotions, motivation, and perceptions during a workday, the single most important is making progress in meaningful work.”

In this article, I’ll show you how to improve your company culture, so that your employees can make significantly more progress in their meaningful work. 

Let’s start with some of the most common problems that undermine productivity.

3 Common Culture Problems that Decrease Productivity

I’m frequently contacted by company leaders who are concerned about their employees’ “time management skills.” They cite complaints like not enough time to focus, excessive email, and concerns about burnout. 

I’d call these workflow management skills rather than “time management skills,” but it’s true that employees can often benefit from addressing these issues. However, the solution needs to start with the corporate culture, because productivity can’t be assessed in a vacuum. If you teach employees more effective skills to manage their workload, but the culture interferes with the team’s ability to implement their new skills, then the training can’t stick.

In my work with clients, these are some of the most common problems I see:

1. Constant reactivity squeezes out PRO-active time.

Leaders often share with me that the office seems to run at warp speed. There’s no time to complete important projects, they say, because their teams are constantly reacting to “emergencies” and “I need it now” requests. 

This leaves little time for team members to work proactively toward achieving the significant results you hired them for in the first place.

When you work in a culture of urgency—an environment in which “everything” is considered urgent—real urgency disappears and it becomes impossible to prioritize work. 

So busy professionals end up spending their days doing little else except react to other people’s priorities. This leads to days that are very busy, but not very productive, and, therefore, unsatisfying—”I was busy all day but I got nothing done!” kind of days.

2. Communication is inefficient.

My clients and their employees typically get over 100 email messages, plus innumerable chat messages, on top of voicemails, texts, and 3-5 hours of meetings per day.

Knowledge workers’ job outputs are typically the result of brainpower—things like analysis, problem-solving, ideas, and relationships. They can harness the power of technology to support this work. 

That said, when these workers begin to feel overwhelmed by their communication channels, it’s a clear signal that organizational communication is inefficient. The result for the employees is mounting anxiety and increased stress.

The source of this problem is not the tools, but rather the habits that workers develop around using these tools. 

A study out of Virginia Tech University shows that office cultures without clear communications guidelines are insidious to the health and well-being of workers. 

The study’s authors conclude that employees need to set clear boundaries around communications, in order to preserve the psychological and physical health of employees and create a culture that’s conducive to progress.

In fact, without communication policies in place, the volume of communication is likely to increase, while worker efficiency is likely to decrease. 

3. Anticipatory stress sets knowledge workers on a path to burnout.

Not only do communication guidelines need to address how team members communicate, but also when they communicate. A company that has no policies around after-hours messaging is likely to make team members feel that they need to be “always on.” 

When leaders don’t think twice about emailing employees at night or over the weekends, their team members are likely to feel compelled to respond to incoming communications as soon as possible.

However, work messages that interrupt personal time are not only bad for employees, but also bad for their families. 

Even if a worker doesn’t receive an email at night or on the weekend, knowing that they potentially could receive a message, prevents them from fully relaxing. 

The knowledge worker remains on constant alert in a state of “anticipatory stress,” just in case a message from work might arrive.

Similarly, companies that expect workers to respond to incoming internal or external emails immediately create the same anticipatory stress in their employees during the workday. 

While it’s true that a customer service rep may need to respond to an incoming email within a set amount of time, responding to every email immediately prevents thoughtful, undistracted work. 

Company cultures that create anticipatory stress set their employees on a path to burnout. This is a costly proposition, since it’s much more expensive to hire a new employee than it is to fix the current culture and retain employees who might otherwise burn out and leave. 

How to Improve Corporate Culture to Increase Productivity

Working around the clock can help meet a short-term deadline, but a practice of doing so won’t serve a team’s long-term goals. For sustainable success, if companies don’t want employees to burn out and quit, they need to cultivate a culture that promotes the optimal state for knowledge workers to do the work they were hired for in the first place—think.  

There is a productive and fulfilling state of mind that workers can achieve when they bring the full power of their knowledge, wisdom, and experience to the job, along with other important characteristics, like empathy, kindness, diplomacy, and passion. This is the optimal state for productive work and it requires what I call brainpower momentum.

So how can corporate leaders build a culture that cultivates brainpower momentum so that each unique knowledge worker is in the ideal state to unleash their genius? Here are three strategies to get your company started:

1. Empower employees with decision-making power.

To create a more proactive company culture, you need to alleviate the sense that everything is an emergency that requires everyone’s help all the time. 

One effective strategy to help achieve this goal is to define the decision-making powers held by each job function. Then encourage direct reports to make the decisions that fall within their roles without consulting you.  

The time to advise direct reports on their choices is after they’ve taken action, usually during a 1:1 meeting. I call this “mentoring in hindsight.” This strategy is based on the fact that people learn much less when advice is given on the front end than they do when they have the opportunity to experience their own successes and failures and discuss them with their boss later. 

Empowering your team to make their own decisions, and then mentoring in hindsight, provides you with more thoughtful proactive time to do deep focused work. This is because your direct reports won’t constantly check in to be sure you approve of their choices. 

It also gives your employees more control and clarity, which makes them happier and more productive. Over time, by delegating decision-making, your team members will learn, grow, become more independent, and be more accountable. Win-win!

2. Make information self-serve.

One communication habit teams can work toward is shifting from mostly synchronous to mostly asynchronous communication. 

Synchronous communication, such as meetings and live chats, happen in real time. A person asks a question and expects an immediate response. (Too often email is treated as a synchronous form of communication when it shouldn’t be.)

Asynchronous communication occurs on a platform when the expectation is that the person making the request will wait some amount of time for a reply. 

There are a variety of tools you can use to communicate asynchronously with clients or colleagues.  You can record a message on Zoom or on a voice recorder on your phone, and then attach the recording to an email. You can upload a document to a shared server and ask team members to post comments.

While traditionally, offices have relied more on real-time synchronous communications, the pandemic and resulting remote work has shifted the balance a bit. 

I encourage leaders to lean into more asynchronous communications, since this allows employees to respond to requests or provide information at a time that works for them.  

3. Take advantage of reputation capital.

Most likely, your corporation has worked hard to build up its reputation capital, which is the positive buzz on your company. Anyone interested in your services has done their research and heard about the reputation of the organization, or a specific team member, before contacting you. Since there is only one of you, they are likely willing to wait a reasonable amount of time for a reply. 

By eliminating the requirement for employees to respond instantly, leaders can slow down the pace of the organization, creating more room for thoughtful, proactive work.

And by clearly outlining what sorts of communication are acceptable after-hours, as well as defining response times to incoming messaging during the work day, you can eliminate anticipatory stress, protect personal time, and reduce burnout.

Build a Corporate Culture That Supports Productivity

If there’s one thing that’s clear to me from my two-plus decades in the productivity industry, it’s that knowledge workers need to use their unique combination of skills and personality to be productive and satisfied with their work.

Too often, a company’s culture undermines the ability of employees to do the deep-thinking analytic or creative work you hired them for in the first place.

However, there’s good news: No matter how entrenched your company culture is, once you apply the right strategies, you can build a culture that better supports employees to make meaningful progress each and every day.

I’ve trained thousands of leaders to do this using my Empowered Productivity System. If you’re interested in learning more, reach out to me here.

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Reach out to either one of us and let us assist you in becoming a better leader, making better decisions. Have a productive day.