leaders in the crisis: McKinsey Global Survey Results Most executives are coping relatively well with the demands and effects of the economic crisis, but people problems loom on the horizon. Executives around the world are working longer hours, taking on additional responsibilities, and experiencing higher levels of stress as they struggle to address the economic downturn, according to a McKinsey Quarterly survey. 1 What’s more surprising, rather than feeling as turbulent as the economy, executives say they feel relatively stable and content about their companies, their work, and their performance as business leaders since the crisis began. All is not well, though. Beyond the averages—and the executive suites—middle managers report dramatically lower levels of contentment than their more senior colleagues do, as well as less of a desire to stay with their current employers. In this survey, a range of executives—from corporate directors and CEOs to middle managers—were asked if and in what way the crisis has led to changes in their professional roles and the ways in which they spend their time on and off the job. They also responded to questions about their levels of physical and mental stress and its sources, rated their own performance as business leaders and the performance of their superiors, and identified the capabilities and mind-sets they have found helpful for tackling the new economic conditions. Most respondents are working more hours since the crisis began, and nearly 40 percent have more responsibilities without the benefit of a new title. Quantity and quality of work More than 80 percent of executives say their organizations’ financial performance has suffered as a result of the crisis. Not surprising, just as many say their companies have already taken steps to reduce operating costs. 2 Executives are working harder in this environment—55 hours a week on average, compared with 45 before the crisis. Two out of three are spending more time than before on directly monitoring or managing operating performance and cash flow. And just over half say they are putting extra hours into setting strategy and motivating employees; four out of ten into dealing with immediate and unforeseen problems and engaging with customers, suppliers, and other external stakeholders. More than half of the executives who are satisfied with their own performance as business leaders were spending extra time on motivating people—compared with only 30 percent of those who aren’t at all satisfied. Though monitoring financial performance is crucial in a crisis, the findings suggest that executives should place a higher priority on motivating employees than they are now. More than half of the executives who are very or somewhat satisfied with their own overall performance as business leaders say they are spending extra time on motivating people—compared with some 30 percent of those who aren’t at all satisfied with their own overall performance. Stress? What stress? Most executives are coping fairly well with the potentially stressful effects of the crisis. Almost 20 percent say their levels of physical and mental stress have not changed at all, and more than 50 percent say stress levels have increased but are manageable in the long term. However, one in five executives say they are worried going forward about coping with the increased stress levels. Among the middle managers, just over one in four are worried about coping. These managers also differ from senior executives in the sources of stress they identify, though overall, executives at all levels are mostly preoccupied with their companies’ situations rather than their personal circumstances. A little more than 20 percent of all executives (but 27 percent of middle managers) perceive that it has become riskier to their careers to speak up on difficult decisions when their points of view differ from the views of more senior managers. In addition, some sources of stress are likelier than others to be important for executives who aren’t satisfied with their performance during the crisis: a lack of operating flexibility, repeated rounds of cost cutting, uncertainty about one’s job, and explaining the company’s performance to investors. Longer work hours are taking a toll on the time executives devote to off-work activities, which may also be detrimental to their effectiveness as business leaders. Those who are finding the time to recharge outside of work are more satisfied with their work performance: although there is little difference in the amount of hours executives at all satisfaction levels are working, 65 percent of the executives who are not at all satisfied with their own overall performance as business leaders are participating less frequently than before in social, religious, athletic, or other activities that interest them, compared with 48 percent of those who are somewhat satisfied and only 36 percent of those who are very satisfied with their professional performance. Looking ahead Middle managers have been hit particularly hard by the demands and effects of the crisis. Companies may therefore need to complement their focus on cost cuts and productivity improvements with increased efforts to motivate the managers who are implementing these steps and are critical to the long-term success of their businesses. Making personal connections and helping managers find meaning in their work, will be especially important. Many executives have found it difficult to look beyond addressing the short-term effects of the crisis. But they themselves indicate they can do better at positioning their businesses for growth, retaining and attracting talent, and developing leaders. Carving time out of operating routines to address these issues will be a key to recovery. The survey findings show that executives who neglect off-work activities important to them are less happy with their performance as business leaders. Executives would do well to keep this in mind as they grapple with their competing priorities. Notes 1 McKinsey Quarterly conducted the survey in July 2009 and received responses from a worldwide representative sample of 1,653 executives. Of these respondents, 47 percent are C-level executives or corporate directors, 33 percent are senior executives, and 18 percent are middle managers. (Note that these figures do not sum to 100 percent, because of rounding.) 2 These findings are consistent with those reported in other McKinsey surveys since the crisis began, such as “Economic Conditions Snapshot, August 2009: McKinsey Global Survey Results,” mckinseyquarterly.com, August 2009. Source: Organization Practice, McKinsey & Company. The contributors to the development and analysis of this survey include Kevin Lane, a principal in McKinsey’s Zurich office, and Monica McGurk, a principal in the Atlanta office.