Why SME’s must lead with empathy

July 14, 2022
Janine Allen

The COVID-19 pandemic forever changed leadership, as the importance of effective communications both internally and externally became pivotal over the last two years. These effective communications skills are now highly prioritized as we continue to recover post-pandemic, forcing the demand for top-tier leaders to prioritize communications tactics amongst stakeholders. According to a CEMS study, empathy, communication and resilience top the list of the fastest-rising leadership qualities, replacing traditionally heralded technical skills and authority.

Traditional communications skills previously valued by leaders were more focused on strategy, strength and steadfastness, yet when the pandemic blurred the lines between work and home, and business and personal, employees needed more from their leaders. They needed empathy.

Communicating through a crisis

As we continue to transition back-to-normal and look ahead to tomorrow’s workforce, we believe small and medium businesses should be leading with empathy and compassion, and here’s why:

  1. Empathy builds a strong organizational culture: When workers feel supported, stable and safe, feelings of belonging increase. As concerns of the “Great Resignation” continue to loom, small businesses may have an even harder time recruiting and retaining talent than larger organizations as often the CEO is also the head of Human Resources. It’s imperative that culture, wellbeing and support are at the core of their approach to HR.
  2. Empathy increases engagement: According to a study by Catalyst , 76 per cent of employees with more empathetic leaders reported higher levels of engagement. Higher engagement among a workforce means that employees are more likely to be invested in the company and the work they are doing, results in higher quality and productivity. This engagement enhances a SME’s ability to compete in competitive marketplaces.
  3. Empathy has financial benefits: Resistance to this shift towards more empathetic leadership is typically because of concerns that financial results will be a secondary focus, forfeited to make way for new, effective leadership soft skills. But the reality is that empathy has tangible financial outcomes. With lower turnover, you save the costs of recruiting and training. With increased wellbeing, the costs of absenteeism and burnout are minimized. And the same Catalyst study also found that empathy encourages innovation, which is critical to business growth and expansion.

The pandemic put a spotlight on great, and not-so-great leaders. The “secret sauce” for this success is strong communications skills and an ability to both steer the ship and make sure the crew was ok simultaneously. Leaders will need to continue to go beyond traditional management skills and embrace soft skills to motivate and nurture their teams.

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