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Let's Break up and Make up

Todd Obolsky
Wednesday, 19 Aug 2009 | 1:51 PM ET

The recession workplace is "broken" and needs some fixing, post-haste. That's not really a new hypothesis; these pages have included such sentiments before. Melanie Haniph, in Advertising Age recently, explicitly diagrammed the situation as the result of three factors: A damaged "psychological contract" between manager and employee, heightened competition that has put pressure on the environment, and a lack of engagement by both employers and workers. But uncertainty -- how long will this last? What else can we do to pare expenses? How can we tell where we're going when the landscape is shifting before our eyes? -- is the driver. This economic cycle is harsher than anything we've seen in decades, and it's putting a definitive (permanent?) stamp on life at the office.

Execs are handed a battle plan and when that is branded a failure by the board or upper level VPs, the battle plan changes track. That happens all the time, of course, but now it's happening at a quicker pace, and with a greater degree of course correction. Real planning goes out the window. Some top managers are either thrown into self-doubt about their abilities, or burn out while extinguishing a series of operational fires.

And perhaps for the first time, upper management is just as expendable as the underlings. (Actually, there haven't been as many replacements this year as last -- planned, forced and voluntary CEO turnover is lagging that of 2008, when almost 1,500 chief execs moved on, according to Challenger Gray & Christmas.) And they're certainly more likely to suffer increased scrutiny and/or public flogging by the media. Remember all those discussions about executive bonuses? A change at the top isn't just for those unlucky souls who sit at the head table at a financial firm; CEOs resigned or were forced out at companies like DuPont, Tyson Foods and Yahoo! as well (though turnover at this level for financial firms is running at 18%, well above the customary 11%).

All this uncertainty has begun to unravel the social/organizational structure at companies of all types. Some places have thrived on the new openness that these times demand. At those companies department heads are sharing some details about finances, staffing and goals that were never spoken of before. Managers are compensating for salary caps and cuts with small perks. In the interest of efficiency, barriers between the decision makers and worker bees are being broken down, even if the organizations themselves aren't getting flatter. Any or all of these actions can be continued once business fortunes improve.

But in the long run, will we use anything we learned from the past two years to benefit the team? It's not likely; the collective conscious has a short memory and is stubbornly resistant to significant change. But the managers and companies that do should bounce back quicker (and better) than their "back to the status quo"-minded counterparts.

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Todd Obolsky has covered a wide range of industries for Vault’s print and online company profiles (including consumer products, government and non-profit, retail, advertising, internet, energy and publishing) and manages Vault’s Layoff Tracker. He has also written for the Rough Guides and DK travel series. He holds a BS in Mathematics from Bucknell University and a MBA with a market research concentration from City University of New York’s Baruch College.

Comments? Send them to executivecareers@cnbc.com

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