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Thorough notes for Lecture 4 for David Swanston for online year of 2020-2021...

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RSM Canada - Developing a “coming out of COVID” work design for Generation Z employees* It is a priority for us to cultivate and maintain a culture where our employees are free to be themselves and embrace the power of being you as much as our brand promise of the power of being understood. To be recognized among a list of top organizations who share our commitment to progressive and forward-thinking programs, particularly those focused on inclusion and diversity, along with other key criteria that make RSM Canada a great place to build a career, is both a personal and professional highlight. - Rhonda Klosler, 2020*

Introduction Rhonda Klosler, Chief Operating Officer of RSM Canada (“RSM”), clicked “Join” when the dialogue box for the WebEx call appeared. As her computer connected, she thought, “Thank goodness we have this technology that allows us to still see each other and connect virtually. I can’t imagine how we would have managed through COVID lockdowns without it.” She was looking forward to this conversation with Lindsay Helmers, an Assurance Manager with RSM, Daniel Booth, National Campus Recruitment Lead, and the recent hires and co-op students that would be joining the call. After everyone joined and spent some time catching up, checking in and getting to know one another, Rhonda focused the group on the topic at hand. I’m glad to hear that everyone is doing well. I can’t believe there are people on this call that I have only seen through a computer screen. Hopefully we will be able to meet in person soon, which is why I wanted to connect with you today. COVID has posed some challenges for managing human resources, in particular, ensuring everyone is engaged, bonding with each other and fully experiencing our awesome company culture. At the same time, it has highlighted some opportunities - everyone is saying they love the flexibility RSM offers and the fact that they don’t have to waste time commuting to the office every day. We’ve also been able to * This case was written by Sofy Carayannopoulos for academic training. It is not intended to indicate effective or ineffective management practices. The author gratefully acknowledges the support of Daniel Booth and RSM in creating this case.

hire some great employees who are in locations we otherwise wouldn’t reach. My question to you today is, coming out of COVID, what would the ideal work design of in-person versus remote activities be for a Generation Z employee? How (and what) technology can be harnessed to make work at RSM a great experience for our staff, in particular, our Generation Z new hires and co-op students? How should it be used to make work lives better, easier and productive? Before opening the floor to discussion, Klosler took a moment to remind everyone of a few key points: The objective is to help employees feel valued and happy working for the company. RSM’s aspiration is to ultimately be the most desirable employer in Canada. The ideal solution will balance the flexibility to work remotely with the need for interaction and bonding between employees. It will align with and build the RSM culture. This connectivity is how RSM wants to differentiate itself in our industry.

RSM RSM provides audit, tax and consulting services to middle market companies, and the firm’s competitors are the big accounting and advisory firms (see Exhibit 1 - RSM competitors for details). Prior to the launch of RSM in the Canadian market and re-brand as RSM Canada, its predecessor firm operated as the tenth largest firm in its industry in Canada with a rich 60 year history. In 2018, the predecessor firm joined RSM International, a global network of independent audit, tax and consulting firms, and became RSM Canada LLP. By 2021, RSM International had more than 12,000 employees in North America and over 43,000 world-wide. It operates in 120 countries and is considered a leader in advising middle market leaders2 globally. RSM Canada currently has offices in Red Deer, Calgary, Edmonton, and Toronto. In 2020, the firm achieved $100 million in revenue with 727 employees3. Unlike its competitors, RSM’s intention is to have integrated offices in the major markets in Canada – Toronto, Calgary/Edmonton, Ottawa, Montreal and Vancouver - with a national alliance of independent firms that help serve the rest of Canada. Located in

Alberta and Toronto, the firm is focusing on building its presence in Vancouver, the next major English-speaking market in Canada.

RSM culture and employee focus The company’s brand promise is to deliver “The Power of Being Understood.” This guides how the company wants clients and employees to feel and be treated. RSM had identified key behaviours (“5 Cs) that were central to delivering the Power of Being Understood and these were now a large and deeply rooted part of the company culture (see Exhibit 2 for a visual depiction of the 5Cs and a link to an explainer video). Caring (deep focus on customer) Collaborative (work with and support each other and the client) Curious (innovative) Critical thinking (truly understanding the client needs) Courageous (think beyond boundaries; challenge) The 5Cs applies to all stakeholders throughout their relationship with RSM, including recruiting new employees because these were the desired characteristics of RSM advisors. As Klosler pointed out, “We’re a people business - we are only as good as the people that work with our clients. Our priority is [therefore] always our people first. But delivering on the “Power of Being Understood” and applying the 5Cs approach extends to our clients and is our differentiator – asking questions, bringing in other experts/perspectives as needed.”

Work environment and culture The values that they embrace as an organization are respect, integrity, teamwork, excellence and stewardship4. RSM acts on its core value of stewardship by committing to operate in an environmentally responsible way but also by giving back to the community. Its various corporate social responsibility activities are outlined here. The organization has supported various charitable causes and events throughout the year and encouraged its employees to do the same. For example, in 2020 RSM Canada had raised $220,000 through its annual stewardship campaign - Birdies for Love. These funds help support various organizations whose mandate is to enhance education or quality of life for children and families (see https://rsmcanada.com/newsroom/news-releases/2020/rsm-

canada-donates-more-than-220000-through-2020-birdies-fore-lo.html for further information). RSM describes its work environment as one where everyone feels comfortable being who they are, in other words, to be their authentic selves (see Exhibit 3 - RSM Recruiting brochure for details on how this is communicated to new recruits). The focus is on authenticity combined with the “Power of Being Understood,” and to address the unique needs and aspirations of each employee (see the information provided at this link for additional details https://rsmus.com/who-we-are/our-values/rsm-talentexperience.html). The pillars of the firm’s human resource practices were: flexibility, career development, inclusiveness and understanding . RSM’s approach to human resource management focuses on an ideology that each employee needs to “own your own future”. When new employees join the organization, they are connected with career advisors and partners to identify areas of interest, ambitions and how to achieve their career objectives. They are asked to share what path they want to take so that they could be supported in building the expertise for that path. Within their first year, they are asked to identify two industries they are interested in and want to focus on so they could become subject matter experts. They can attend local, national and US-based conferences that are focused on the employee’s identified interests. Pre-COVID, everyone would go to Chicago for training with the purpose of not only learning more about their industry of choice but also to build networks and a community across North America. There is a strong focus on getting designations as well and the firms provides paid time off to study and write exams, pay for education, and work with an external vendor to prepare for exams, resulting in a 98% pass rate. Promoting inclusion and diversity begins with the leadership team and is driven by Employee Networking Groups (ENGs) that centre on different themes. The ENGs are driven by employees and their purpose is to create community and a forum for understanding by bringing employees that have similar interests or backgrounds together. ENGs are encouraged to create events in which all employees can participate. The events promote networking, professional development, mentorship, and education that fosters understanding and respect for members. For example, to foster learning and growth, ENGs might facilitate “courageous conversations” around their themes, during which employees can ask any questions that they were struggling with, without being judged. Courageous conversations focuses on timely topics, including mental health and systemic racism, and have included external speakers as well as internal speakers from across North America to aid understanding. Approximately 60% of staff and partners have chosen to become part of an ENG.

Leaders are always present and involved in ENG events. The enthusiasm, engagement and participation rates of top leaders in organized social activities are comparable to those of newer employees. There are also no barriers between the various levels of the organization, so an employee anywhere within RSM can reach out to anyone else in the organization for help, advice and information, regardless of the individual’s position. The camaraderie and casualness of interactions between employees is not hindered by differences in where they are on the organizational hierarchy. RSM’s approach to its employees has been recognized with various awards. In 2021 it was named one of “Greater Toronto’s Top Employers”1 and in 2020 was recognized among Canada’s “Most Admired Cultures5”

The job RSM’s growth is fueled by its partners who build relationships while leveraging teams to execute on the deliverables with clients. Managers and their teams work with clients. Consequently, employees collaborate and coordinate with each other, even as they complete their individual responsibilities. In addition, sub-groups within lines of business are set up so that they can become subject matter experts and connect with fellow colleagues in the same area who work on the same tasks. Rather than have employees focus on specific tasks for a variety of projects, they are given line of sight from cradle to grave on projects so they understand the entire deliverable and their role in it. Letting employees be involved in all client activities ensures employees see the value and impact of their work. To acknowledge and reward performance, employees are provided fast feedback and internal points and recognition, “accolades6”, can be awarded to anyone by anyone.

COVID hits Prior to COVID, it was easy for staff and partners to organically connect and experience the culture of the organization. It was easier to share stories and ask questions as people worked side-by-side, passed each other in hallways, or while taking coffee

breaks. You could read quotes on the office walls and participate in various in-person events throughout the day. Quite suddenly in March 2020, COVID was confirmed a global pandemic. Governmental responses across the world varied widely, but in Canada the Prime Minister announced the first in a series of stay-at-home orders, forcing businesses to move employees to work from home wherever possible. RSM’s top priority was to keep its employees safe while figuring out how to service clients right in the middle of the busiest time of year. Canadian leadership had to jump into action and within 24 hours had 727 employees and partners set up to work remotely. Employees were “tooled up and trained up” on Webex and other online platforms to support clients and their needs. This was not an easy task and required trust, solid leadership and lots of online training on how to use WebEx more efficiently, access the tools online and connect to teams and clients in a new space. Rhonda Klosler shared that leadership, “over-communicated so our people understood where we were going and what decisions were being made at all times”. RSM’s IT and HR team quickly identified how to virtually onboard new hires and set them up with the equipment they needed (ex. laptops) so that were ready to go from their first day on the job. All new hires went through extensive virtual training with collaboration with colleagues across Canada and the U.S. Externally, RSM had to pivot to address clients’ needs and opportunities in a new way. Audit and tax functions had to be moved completely online and the consulting line of business, which was now outpacing the other two lines of business on growth, had to focus on technology, digital capabilities, and infrastructure for technology because clients now needed this support to build new skill sets. Initially, technology was the biggest challenge. Employees were given as much support as needed but they were also asked to give themselves grace. They were used to being the best in what they do and struggled to give themselves time to adjust in this new environment. They were encouraged to reach out for help and told that it was okay if everything wasn’t perfect. There were regular touchpoint meetings to check-in with employees/teams and make sure they had what they needed for their jobs and themselves. Once the organization found its rhythm with remote working, it pivoted to creating community. There were quarterly calls to bring different ENG communities together.

Social activities such as virtual escape rooms and an online Second City comedy night were organized. RSM was also cognizant of Zoom/WebEx fatigue so they started putting boundaries on expectations, i.e. don’t answer emails after a certain time in the evening, block a lunch break to step away from work and your computer, take meetings as calls rather than videos, and try “walking meetings” outside. They began using breakout rooms and surveys to capture thoughts and opinions to ensure all voices were being heard and many are hesitant to speak up in large, remote groups. The firm moved their summer leadership program online and held it virtually across Canada. In 2020, the focus was on what technology could be used so the experience didn’t look clunky - they used more cameras, integrated surveys and used breakout rooms to create a more comfortable experience. Recruiting new talent was done completely online and there was an important silver lining: RSM was able to attract excellent talent from remote markets because employees were not constrained by the need to travel or live near RSM’s physical offices. In January 2021, it was clear that RSM had been able to successfully pivot to remote work. It was having its best year ever, growing revenue 12 to 13% year-over-year – with tax and consulting services leading the growth particularly in areas like digital transformation and automation.

GENERATION Z CHARACTERISTICS7,8 Generation Z is referred to as individuals born between 1997 and 2012. Professional and academic achievement is generally highly valued by this generation, and they are focused on personal growth and development. At the same time, this generation values purpose and social responsibility. They are digital natives and have never known a time when the internet did not exist, but they also crave in-person interaction. They want human connections and to feel like they are part of a team. Studies suggest that when dealing with a remote Generation Z worker, recurring meetings are good for bonding and ensuring this person is heard. Connectivity via video calls are better than telephone calls. What sets this group apart is that COVID disrupted their education and disconnected them from their regular learning in a communal setting. The way this groups learns has therefore been impacted which means that employers may have to reconsider their

orientation and skill development programs in future years. In addition, the substantial disruption to their social and educational experiences has increased their baseline stress levels far above those of prior generations.

Remote versus in-person tradeoffs and issues There was a range of options between entirely remote and entirely in-office work design (see Exhibit 4 - The In-office to Fully remote continuum). After organizations recovered from the imposed requirement to work remotely, they began to reconsider the potential for doing so more systematically and permanently. Large companies such as Facebook and Twitter announced they would take a large-scale approach and that working remotely would be permanently adopted.9 However, it was clear that the issue was not simply a matter of offering employees laptops and enabling video calls. Organizations must address the issue of technology – what and how it would be used to allow for effective collaboration, coordination, and productivity. They would need to consider the physical resources of their organization would offices be temporary and small, and widely scattered to enable employees to reach them or would they be large and centralized? What would travel expectations and support entail? And what structures and approaches could be used to maintain culture and values? Klosler had asked at the start of the meeting, “How could RSM overcome the challenge of lost training and development opportunities as well as the brainstorming of new ideas and building a close culture that happens naturally when you are sitting side by side with your colleagues?” There were many tools that were already available but had become invaluable in a remote work setting10. For example, online whiteboards that mimicked the ability to create and move around post-it notes on a physical whiteboard, platforms that mimicked a physical office that allowed employees to create cartoon images of themselves and physically walk to each other, or even virtual reality office experiences. New methods such as “Working Out Loud” surfaced as well. The options and tools were endless, and the most successful companies would harness them not just effectively, but innovatively to differentiate themselves as employers.

CONCLUSION Being forced to work from home due to COVID created many challenges, but it also revealed opportunities. It highlighted what could be accomplished remotely such as

accessing talent from distant locations. It unearthed flexibility and autonomy for employees and eliminated long daily commutes. The question that Rhonda Klosler now wants to focus her leadership team on is how should RSM harness technology to create a better work experience and environment for Generation Z new hires and co-op students? What was the right combination of remote and in-person in terms of time and activities? What specific technologies might be adopted and how might they be used? She hoped that the team would have some innovative and effective recommendations for technologies and work design. The objective of the solution was to make generation Z employees in particular feel valued and happy working for the company. RSM’s aspiration was to ultimately be the most desirable employer for top talent across the country. The best solution would differentiate RSM from other industry employers, balance autonomy and flexibility with interaction and bonding and align with and build the RSM culture.

References 1. RSM Canada. (2020). RSM Canada named as one of Greater Toronto's Top Employers (2021). Accessed at https://www.newswire.ca/news-releases/rsm-canada-named-as-one-ofgreater-toronto-s-top-employers-2021--820338637.html

2. RSM Canada. (2021). Company-provided data 3. Klosler, R. (January 23, 2021). Personal communication 4. RSM Canada. (2021). Our values. Accessed at: https://rsmcanada.com/who-we-are/ourvalues.html 5. RSM Canada. (2020). RSM Canada recognized among C...