In the midst of October’s economic uncertainty and turbulence, a reporter sent me an e-mail asking what leaders need to do in order to keep their business on track and employees reassured. Here are her questions and my responses:
What do a firm’s executives and leaders need to do to reassure staff and maintain productivity?
Leaders need to provide opportunities for staff to vent their fears and concerns and ask questions about how economic turmoil might impact their organization. These could be a series of town-hall type meetings or more informal chats over coffee, lunch, or just hallway conversations. During turbulent times leaders must dramatically ramp up the amount of time they spend out of their offices talking with staff, key customers, and any other critical constituents. Leaders should be as open and transparent as they can about what’s going on in their markets/organizations and share what information they have.
Like nature, communication abhors a vacuum. In the absence of concrete information and real data, people will make it up. And since negativity and fear feeds on itself during uncertain times, people tend to feed the rumor mill with catastrophic scenarios of impending doom.
Strong leaders make people hopeful and focus everyone on what could be. The tricky balance is to point out the rays of hope amidst the doom and gloom without being Pollyannaish or looking like you’re hiding your head in the sand. Issues or problems should be faced squarely. But they need to be framed with a can-do attitude. Focus on building confidence to counterbalance all the drag of negativity and disaster. Use stories or examples of how the organization, you, members of the audience, or others have faced similar situations or worse in the past and how those tough times were overcome – leaving everything stronger as a result.
What is a realistic course of action for a firm leader to address business conditions, to evolve with changing situations, and to maintain staff morale?
Increase participation and involvement as broadly as possible. Find ways to include as many people as you can in identifying and working the key problems facing the organization. If this work is focused on strategic issues that will truly make a difference it will help to focus everyone’s nervous energy, and increase everyone’s sense of having control over their own fate, while reinforcing a feeling of progress and forward momentum.
A big fear for most staff is losing their job during a time when finding another one and paying bills may be difficult. Strong leaders look ahead and prepare for the worst while helping people focus on bringing about the best possible outcomes. Click here for my views on how wise managers treat lay-offs as a last resort.
What are some of the classic mistakes leaders make in tough financial times like the one we are currently experiencing?
- Adding to doom and gloom with fear and a negative attitude.
- Jumping to downsizing and layoffs without fully exploring the myriad of alternatives that are much more inclusive and treat staff as partners in finding ways to reduce costs rather than “overhead” to be chucked overboard like useless ballast as the ship is sinking.
- Running closed-door meetings in their offices with just other managers. This feeds the rumor mill of fear and impending doom.
- Not communicating. People need to know what’s happening “out there” and what the organization is doing about it.
- Failing to realize that they are being minutely scrutinized for any signs of distress or coming disaster. During a previous recession a CEO was seen on the elevator holding my second book, Firing on all Cylinders: The Service/Quality System for High-Powered Corporate Performance, which he was reading. He didn’t realize that as he held the book with the title facing outward his hand covered up all of the title except for the word “firing.” Within hours rumors raced through the building that the CEO was planning mass layoffs. In fact, he and the senior team were working on a plan to reduce costs through quality improvement and reverse sliding revenues through increased customer service. The effort succeeded and the company not only didn’t let anyone go, they actually hired more people over the next few months.