Companies run to their own annual rhythms


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Srationality is a a large part of the business. For some industries, seasonal trends are a defining characteristic. Agriculture is an obvious example; tourism another. Western toy manufacturers make a considerable portion of their annual sales in the run-up to Christmas. Construction is more difficult in cold weather, which is why this industry employs fewer people in the winter.

Businesses that are less obviously tied to the seasons can nonetheless be profoundly affected, as a recent study by Ian Hohm of the University of British Columbia and his co-authors makes clear. An analysis of social media posts on Twitter, now X, found that diet-related tweets peaked in the spring, as body dysmorphia season approached (i.e., summer). Condom sales and online searches for pornography in the United States tend to increase in the summer and around Christmas.

Even when overall demand doesn't vary much from season to season, preferences change. Beef eaters buy diced meats and roasts during the slow-cooking winter season and turn to steaks during the summer grilling months. Starbucks is one of those companies that makes seasonality a marketing event. Pumpkin spiced latte is a reliable sign that fall is coming, as are falling leaves and sullen faces at condom makers.

Seasonality also leaves a less obvious imprint within organizations. Just as there are daily and weekly patterns of activity, from late afternoon concentration dips to the ebb and flow of hybrid workers coming into the office, annual cycles leave their mark.

One of them takes place this week, with the World Economic Forum's annual party in Davos. Aside from public holidays, no other week of the work year has as many CEOs of large organizations reliably. The corporate world briefly found itself without a government, a concentrated version of Belgium in the early 2010s. Perhaps this is Davos' real contribution to improving the state of the world: with so many bosses stuck on a mountain for a few days, productive employees can concentrate on their work and lazy ones can relax.

School holidays provide an obvious form of seasonality, although in this case people across the organization are on leave. Massive absences make it difficult to plan meetings in Brazil between Christmas and the start of Carnival; it's a similar story in August in Europe.

These patterns of clustered absences manifest within organizations in major and minor ways. Second-tier employees are more likely to get the chance to run the show; Fewer major initiatives are likely to be launched when the holidays are in full swing. Employees without children are unhappy at having to replace their colleagues on vacation; colleagues on vacation are unhappy about having children.

There is evidence that people feel more creative after returning from vacation, but you need to schedule that brainstorming session quickly. A 2010 paper by Jana Kühnel of Goethe University and Sabine Sonnentag of the University of Mannheim estimated that the benefits of a break wear off within a month.

Significant events also mark the company's calendar. Some are public: annual general meetings and letters to shareholders, for example. Others are internal. In many companies, the annual budgeting process involves a collective organizational effort, during which more and more people spend more and more time discussing numbers that are almost certainly wrong. It's almost a season in itself. A pre-pandemic estimate of APQC, a benchmarking organization, has estimated that the median company spends about 30 days on this effort; in many companies it takes much longer.

Salary decisions are also seasonal events. The moment employees find out about their pay raises and bonuses sets off waves of disappointment and happiness across workplaces. In some cases, they are more like tsunamis. The bonus round on Wall Street, in which bankers find out what they will get for their work from the previous year, is underway and has been preceded by months of infighting and gossip. The actual date bonuses are paid also matters: once money is safely deposited in the bank, people are more likely to change jobs.

There are other forms of business seasonality. The office Christmas party marks a further drop in activities. Some companies shorten the work week during the summer months. Annual calendars are punctuated with business conferences and leadership retreats. There is little research on the impact of seasonality within businesses. That they have their own annual rhythms is indisputable.

Read more from Bartleby, our management and work columnist:
When your colleagues are also your rivals (January 11)
The CEO's message for the new year (January 1)
The return of the dying uncle from The Economist (December 20)

Also: How Bartleby Column got its name



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