Good leaders follow
simple rules to lead successfully in economic challenging times.
When I pose the question, "What keeps you awake
at night?" to CEOs, the most frequent answer is "How should I lead
my company?" -- Do I cut back? Do I lay off people?
Do I slow product development? Do I expand? Do I invest?
How do I know what's right? How will I know when the downturn
is over? What should I do then?
My own experiences and my consulting
with corporate leaders worldwide have led me to formulate seven
rules for leading in tough times:
- Focus on your vision.
Your vision points the way to the future. Economic malaise
is temporary, as is economic robustness. It's your vision
that's permanent, with its associated mission, values, and strategy.
Ensure it is sound, and reiterate it to all employees.
- Sharpen your competitive advantage.
Every company differentiates itself from its competitors in
some way, such as, low cost, quality, product range, distribution
system, market knowledge, or customer service. Sharpen your
advantage (or core competency). If it isn't working, or
if you don't have one, then get a new one.
- Hire good people. During any
economic downturn companies lay off good people. The demographic
shortage of younger workers suggests now is the best time you
will have in the next two decades to seek them out and hire them
for your own company.
- Redeploy your best. When times
are tough, have your best people lead initiatives to open new
markets or redesign the manufacturing line or find acquisition
candidates. Your other employees are competent enough to
keep your company operating.
- Guard your cash. "Cash is king!"
is never more important than during tough times. Husband
your cash: use it prudently to maintain your current operations;
and invest it wisely for the future, including hiring good new
employees.
- Manage your knowledge. What
separates the winners from the losers in a knowledge economy is
how well they capture, process, disseminate, and leverage their
unique knowledge. Strengthen your knowledge management system
or, if you don't have one, develop it. This is a truly splendid
way to redeploy your best.
- Eliminate the valueless. Now
is the time to cull the reports that never lead to action, to
reengineer your processes, and ruthlessly to eliminate anything
wasteful. This includes trimming (humanely!) your people
- even very good ones - whose skills or interests will not add
value to your company's future.
Leaders lead. All the time! The
present economic softness simply magnifies the importance of rules
such as these which good leaders follow in good times and bad.
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