Wednesday, July 1, 2009

Economy Leaves Little Room for Leadership Mistakes

This column appears in the July 2009 issue of The Business Journal of West Central Ohio.

I don’t need to tell you that belts are being tightened all over the State of Ohio. Businesses of all sizes are working with reduced staff in an attempt to keep overhead low and the chance of survival high. Employees are being asked to do more, do it better, do it faster, and with less resources than ever before. It is a time like this that reminds me of a quote that is often attributed to John Wooden of UCLA basketball fame (even though the originator of the quote was actually a sportswriter named Heywood Broun): “Sports do not build character, they reveal it.” In a leadership context, an appropriate version of this quote might be “Crisis does not create leaders, it reveals them.” Now is the time for the leaders of your organization to reveal themselves.

The department typically under the most pressure right now is human resources. The key word here is human. Your staff is your greatest asset…and they are coming to work stressed right now. Even if your particular business is doing well, your employees may still be bringing the stress of their spouse’s job with them to work. If your business is not doing well, just imagine the concerns that your employees may have. Many companies have laid off staff and the remaining staff may be wondering “am I next?” Stress may manifest itself in the form of increased sick time being taken by staff, lower morale, increased workplace violence, and a general decrease of productivity. None of those are a desirable outcome.

It may be obvious to you that this is not simply an HR issue. Rather, it is a critical issue that leaders at all levels of the business need to be concerned about. It is something to be proactive about. Consider these steps:

  1. Keep communications open and honest. Avoid spinning the situation to convey a contrived positive. Your employees are smart and can smell when they are being “fed a line." Such actions tend to reduce the credibility of the leader. When a leader needs to make tough decisions (such as reducing hours or benefits), credibility is essential in gaining the understanding of the staff.
  2. Increase the personal touch. Get out of your office and implement MBWA (Management by Walking Around). Spend time listening to your people. Try honestly to see things from their point of view and resist the urge to debate decisions. Let them do a great deal of the talking!
  3. Set goals (or adjust ones you already have). Give the staff something to work toward. This gives them something positive to focus on. Perhaps create productivity competitions between shifts.
  4. Include more people in strategy. If you have a strategic planning team, ensure that it has representation from every level of the company. This increases employee engagement and could improve implementation. People tend to take ownership of programs that they feel they had significant input in.
  5. Invest in your team. Too often, companies shut down all programs that can improve productivity in order to keep overhead down. This is actually the exact wrong thing to do at the exact wrong time. It’s akin to stopping maintenance on machines in the assembly line. Appropriate training can yield significant benefits in productivity and morale for your organization. You may want to focus on your “front line” managers. These are the people that are “getting it from all sides”. Investing in these managers can often yield the greatest dividends in the shortest amount of time.
  6. Handle mistakes carefully. Your team is made up of humans…and they make mistakes. Assuming that the offending employee is not a chronic problem, look at the mistake as a coaching opportunity. Your goal should be that the employee, after having the mistake addressed, should come away MORE engaged in what the company is doing. In other words, a mistake can be an opportunity to improve an employee. Handled incorrectly, however, the mistake might just turn into a chronic issue. In good times, disgruntled employees will leave. In times like this, disgruntled employees are more likely to stay because there are fewer options. But if they stay, they will not be a model employee. Chances are, their performance will continue to degrade and they will take up more of your time. Remember, employees don’t leave companies. They leave managers.
  7. Keep a long-term view. One of the greatest mistakes I am seeing companies make right now is making choices that are too heavily based on the short-term. These companies have cut everything to the bare minimum and are focused simply on reducing overhead. There is very little thought given to strategy. These companies have essentially succumbed to a self-induced business coma. When the economy starts to turn around, these companies will still be slumbering and will lose valuable time and consequently, market share.

With the right attitude, focus, and leaders in place, your company can avoid the business coma and leap ahead of your competition.

1 comment:

  1. Great thoughts and comments. Leaders in today's environment have to be mentors, because it's in that process, workers are empowered to be better therefore building loyalty and more committed leaders/followers in the end. Keeping ahead of the trends and communicating the necessary plans for survival is paramount for success for your people and your company.