On December 4, 2019 at the Parker Hotel in Midtown Manhattan, State Street Global Advisors’ Defined Contribution team brought together retirement consultants and plan sponsors to participate in a conversation about change. Kathryn Sweeney, Head of Institutional, Americas at State Street Global Advisors, began the afternoon by posing the question, “What can we expect as we enter the third decade of our third millennium?”
To broach this broad theme, former Senator Clair McCaskill, State Street Managing Director of Retirement Policy Melissa Kahn and former U.S. Women’s Soccer Coach Jill Ellis presented insights on how to lead through changes to either political or performance norms – touching on generational shifts, the role of media and the hope ahead.
Claire McCaskill on Polarization
Former Senator McCaskill (MO-D) opened her remarks by asserting that America is experiencing a time of awkward and debilitating polarity, a divisiveness that is inviting dysfunction. From inaction in Washington to discomfort in the workplace, people are having a harder time finding common ground and forging social bonds – either across the Congressional aisle or corporate cubicle.
In part, division is driven by a diversity of expectations. With five generations commingled in the today’s workplace, from Gen Z (born 1997-2012) to the Silent Generation (born 1928-1945), some long for the past, others seek to forge an entirely new future and many are caught in-between.
To solve polarization in the workplace, McCaskill suggests employers focus on shared values, namely family and community service and allow employees meaningful time for both.
For Washington, McCaskill suggests a similar, distinctly pre-digital approach for creating more consensus. Before technology enabled people to work remotely, members of Congress stuck around over the weekends, got to know each other and their families and formed authentic relationships that created greater civility and collaboration on the Hill. Today, many have returned to their home state by Thursday evening, creating an abbreviated work week that doesn’t allow for much time or energy to develop real relationships. Though some issues, like increasing retirement security and battling the opioid crisis bring Congress together, partisanism continues to be the mode the operation.
But there is hope for cohesion – and it lies in the rising generation. McCaskill said that on her more difficult days on the Hill, she would review resumes of the candidates seeking to work in government and was heartened to see that the best and the brightest were eager to take the helm – and hopefully would right the ship. These days, she looks to less tenured members of Congress to vote on principles over party and help shake loose the current constriction.
Today’s polarity, while uncomfortable, may not be wholly unproductive. Extremes catalyze change and can help rebalance the civic discourse. McCaskill is particularly interested in the benefits of an Institute of Political Journalism in the service of reaffirming fact-based, credible reporting. She hopes to see an end to campaign contributions of unknown origin and party-serving administration of the consensus, and suggested that a greater emphases on truth and transparency may help to solve these scourges.
Melissa Kahn Foresees SECURE
At the time of the December 4th event, Congress had yet to pass the Setting Every Community Up for Retirement Enhancement (SECURE) Act. But State Street’s Managing Director of Retirement Policy, Melissa Kahn, spoke with prescient precision on bill components and expected plan impacts.
The SECURE Act passed later in the month and is heralded as the most comprehensive retirement legislation to be enacted since the passage of the Pension Protection Act of 2006. In light of longer lives, dwindling defined benefits and evolving work styles, bill provisions are intended to address demographic and societal shifts and reinvent the retirement experience. By extending plan access to more working Americans, nudging increased savings contributions, expanding distribution and spending options and boosting financial literacy, SECURE is the solution American workers have been waiting for. In 2020, plan sponsors and recordkeepers will have a series of implementation decisions before them in preparation for the next generation of defined contribution plans.
Jill Ellis’ Pressure Points
“Pressure,” says former Head Coach of the U.S. Women’s Soccer Team, Jill Ellis, “is what you feel when you’re doing something well. Embrace it.” In fact, Ellis has used her team’s comfort in a crunch as an advantage. “We live in pressure daily. Our opponent just comes to visit for 90 minutes.”
So, how have Ellis and her players found a way to harness the spotlight, letting it energize them and not burn them up? At a certain point, performance and achievement become less about talent and more about one’s ability to both focus and adjust; pivoting to new positions, plays and people without losing site of the goal.
Ellis talked about the differences between the 2015 World Cup, 2016 Olympics and 2019 World Cup. After the 2015 World Cup, they were a cohesive team of champions. The loss at the Rio Olympics a year later, though devastating, proved to be instructive. International teams were trying to neutralize the athleticism of the Americans by boxing them in, creating tighter spaces of play. Ellis needed players who could be agile enough to break out of this defensive strategy, and worked for the next three years to reshape the team accordingly.
It wasn’t easy. Internal change affected team dynamics. External change, like the increased media and market attention to players’ individual brands, altered the experience of leadership and cohesion. In 2019, Ellis found herself working harder to engage players, in part by facilitating more independent decision making among them. She leveraged game data to support coaching strategies and motivate behavioral change, used video game-like software to illustrate tactics and shortened team meetings to give players more time to assimilate information on their own. Together, these approaches created a clarity of roles, raised player engagement, team commitment, and engendered professionalism in and out of the white lines of the field.
Ellis also made the point that to manage high performing teams, you must manage fairly but not equally. Establish the necessity of all players to achieving a win, and the utility and hierarchy of each along the journey. This mentality pervades through big and small ways, including the language Ellis used on the game lineups: starters and game changers – not “benchwarmers” or “subs,” but players who would have the opportunity to change the outcome of the game at the right moment.
Through all of it, Ellis has reflected on what it means to be a leader. “It’s a self-belief, a grit, an internal fortitude.” As sports continue to trend towards individual brands, it will become harder to coax those characteristics into the service of a team, but natural leaders will have to try, for the benefit of us all.
Whether a Congresswoman, a retirement policy strategist or a winning coach, the question of change is critical. How can leaders discern between productive changes and destabilizing ones? How can they manage their constitutes through change, while keeping key objectives in sight? Whether politicos or 401(k) plan participants, the advice seems consistent and commonsensical: prioritize relationships, be prepared to perform, lead with truth and transparency and celebrate individual accomplishments while honoring the communal effort behind them. All speakers were most optimistic about the rising generation’s ability to be nimble in navigating change and to thrive in a more frank future.
Like the market, there will be highs and lows, but that volatility comes with the experience of life and should be embraced as just part of the journey.
The views expressed in this material are the views of SSGA Defined Contribution as of February 1, 2021, and are subject to change based on market and other conditions.
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EXP: February 28,2022