May 8 2008 09:42 AM

In good times, running a company is exhilarating. Money is flowing, customers are happy, employees have a spring in their step. In not-so-good timeslike nowthe very same job can feel like scaling Mt. Everest in a snowstorm while wearing a knapsack filled with bricks and suffering from a bad case of the flu. All reports indicate that a recession is coming and you suspect the next few years will be rough. You know theres no magic pill for business success, but you do wish someone would at least give you, say, a guidebook to healthy habits.


Actually, there is something you can do to fortify your company for the future: create an organizational culture that develops great leaders today and instills the mechanisms and the mindset that will continue to foster great leadership tomorrow.

Great leadership is everything. All other elements of success flow from it. Companies with mediocre leadership can skate by when the economy is booming, but in tough times they really suffer. Your leadership must be top-notch. If it isnt, you may not be around five years from now.

So what can you do to get through the recession? Well, creating a culture of sustainable leadership doesnt happen overnight, but there are steps you can take right now that will yield quick wins and get your organization on the right path:


Develop a get-through-the-recession plan. Sit down with senior-level management and go through your business plan with a fine-toothed comb. Figure out which objectives you are meeting, which ones need more emphasis, and which ones you should re-think. Make sure goals are aligned across every part of your company, that everyone is singing from the same choir book. At the same time, scrutinize your expenses and cut anything thats not absolutely necessary. And (heres where many companies drop the ball) communicate your plan to all employees.


Upper-level managers are notorious for figuring out a plan and failing to let people know whats going on. Remember: If your front-line employees dont know you have a get-through-the-recession plan, you dont have a get-through-the-recession plan. Everyone needs to understand the plan and buy in to it.


Address the tough issues with straight talk and transparency. Chronic secretive behavior from leaders and lots of behind-closed-door meetings harm morale in any economy. Rumor and gossip thrive in a vacuum. But when youre making changes in response to an economic downturn, transparency is especially important. If employees can tell you are hiding somethingand 9 times out of 10 they cantheyll assume the worst. They know tough times are at hand and they probably lie awake worrying as often as you do.


Dont candy-coat the truth or act like nothings wrong. Its insulting to employees and it erodes trust. They deserve and expect to be treated like adults. Pretend everythings rosy when its clearly not and you might scare your best people into running for the hills.


Equip supervisors to answer employee questions. Lets say Worker Walt approaches Manager Mike to ask if the rumor he heardthat the Duluth division is on the verge of closing downis true. Mike responds with a deer-in-the-headlights stare and a vague stammered comment that the company is doing its best to avoid any closings. (He knows the Duluth shut-down is off the table, but isnt sure how much hes empowered to say.) Walt draws his own (grim) conclusions and starts spreading the bad news. The rumor mill kicks up a notch and morale plummets. To avoid such scenarios, train managers on exactly what to say regarding timely issuesand how to say it.


Be very specific. Mike didnt say anything that wasnt true. He just failed to say it clearly, concisely, and confidently. You can prevent these kinds of misunderstandings by telling managers exactly what to say when employees ask questions about the companys future. Write a script of sorts so that everyone is speaking in the same voice.


Nix the negative self-talk. Okay, leaders, truth time: Do you sit around chewing your nails and dreaming up terrible scenarios? What if our biggest customer pulls out? you fret. What if the market for our services dries up? What if our top salesperson gets spooked and goes to work for a competitor? If this sounds like you, stop it right now. When you exist in a constant state of worry, your state of mind infects everyone. Self-confidence plunges. Creativity ceases. Forward motion halts. And besides, 99 percent of the disasters you agonize over probably wont come to fruition.


I heard something recently that really resonated with me. FEAR means Fantasized Experiences Appearing Real. Its true. We sit around and conjure up all these awful scenarios and then wonder why we cant move forward. Fear paralyzes. And no one can paralyze himself into moving forward.


Dont permit fear to get a foothold in your company. One of my favorite phrases is What you permit, you promote. When you allow free-floating anxiety to permeate your company, youre basically giving it your stamp of approval. If an employee expresses worry about the bad economy, dont just clap her on the shoulder and say, Yeah, I know its rough; hang in there! That lends credibility to her anxiety and indicates that you share it. Plus, empty consolation is supremely unhelpful.


A better solution would be to say to her, Tell me what youre struggling with today. Get specific. Engage the worried employee. Ask, What can we do to help you? Often, the simple act of vocalizing fear helps defuse it. And encouraging employees to do so gives leaders the opportunity to reinforce the companys strategy.


Stay connected. Employees really need you right now. One way to make a real connection with employeesdailyis to practice rounding for outcomes. In the same way that a doctor makes rounds to check on patients, a leader makes rounds to check on employees. The technique allows you and your managers to regularly touch base with employees, make personal connections, recognize success, find out whats going well, and determine where improvements are needed.


Rounding helps you build a strong emotional bank account with employees. Mind you, thats always important, but its especially critical in a down economy. When you need to rally the troops, they have to know you care. Troops who dont think you care cant be rallied. They might even desert.


Get rid of low performers. Yes, now is the time. Low performers suck up a disproportionate amount of managers time, tick off customers, squash morale, and drive away high performers. When business was booming, you may well have let their bad behavior slide. Now, the day of reckoning is here. You should be spending 92 percent of your time with high and middle performers and only 8 percent with the people who dont really want to be thereand if youre not, you must take steps to remedy that now. (In Results That Last, I outline a plan for doing just that.)


You cant afford to alienate your customers; you cant afford to neglect your middle performers; you certainly cant afford to lose your superstars. In short, you cant afford to keep your low performers any longer. Period.


Look for creative ways to hang onto top performers. In uncertain times, it would be disastrous to lose your best employees. But at the same time, it may be unrealistic to pony up a big raise right now. Thats okay. You can offer your people perks that dont cost the company a lot of money. Think about ways you can make their lives easierflex time, partial work-from-home schedules (much appreciated in these times of exorbitant gas prices), access to a chore runner to pick up dry cleaning and stop by the supermarketand implement them.


For example, many employees have no type of financial planning in place. You might give them access to the companys CPA or financial planner, who can advise them on better bank accounts, IRAs, college funds, debt repayment, and more. So even if you cant provide bigger paychecks, you can help them manage their expenses a little better.


Put your best face forward with a Standards of Behavior contract. How should employees answer the phone? Should they knock before entering a coworkers office? Steer clear of controversial topics like politics and religion? Keep cell phones turned off? You may never have given serious consideration to such questions, but you should. Create a Standards of Behavior contract that employees help craft, then sign. (My book gives more details.)


The idea is to create the best possible company, a place where employees can do their best possible work and customers can get the best possible service. These contracts ensure that everyone consistently has a great experience with your company. Thats always important, but in economic hard times its absolutely critical.


Always manage up your organization. Insist that employees do the same. A recession (or downturn if youre not willing to use the R-word) is simply a national confidence problem, usually exacerbated by lots of negative talk. The same dynamic exists in your own sphere of business. Thats why you should say only great things about your company and its staff, whether youre talking to outsiders, clients, or employees themselves. Also, you should insist that your employees do the same. I call this managing upi.e., accentuating the positiveand its a valuable confidence-building tool that keeps employees content and customers coming back.


 Never tell a client that business is slow, even if it is. Dont express doubt to employees about your companys ability to weather this downturn. Tell everyone how great your company is, how talented your people are, how excited you are about the future. All this positive talk becomes a self-fulfilling prophecy.  


Shine a 1,000-watt spotlight on customer service. Okay, this one may seem obvious, but it cant be said too often. When pressure to stay competitive is at an all-time high, you must be absolutely certain your customers are getting what they want and need from your company. Dont assume that just because theyre not complaining, theyre happy. I suggest you start asking each customer exactly what her expectations are, document them on an individual preference card, and make sure all employees who come in contact with her get a copy.


Never presume you know whats important to a customer. Always ask, and always get it in writing. Individualized customer service is more critical now than ever. In the Globalization Age, its the only way you can differentiate yourselves from your competitors. So dont look at it as merely a way to hang on to your customers until you get through the downturnlook at it as the new normal for your company.


There is a very big positive that comes out of downturns: It sharpens our survival instincts and shows us what were really made of. Instead of just coasting along on the wave of an economic boom, were forced to get focused and get serious. And for many companies, the pressing need to turn it up a notch kick-starts a journey of transformation.

Out of difficulty, heroes rise. Yes, there are losers when times get tough, but there are also winners, and some of them win really big. In other words, there is plenty of opportunity out there even nowespecially now. Someone is going to seize that opportunity, gather up the customers others arent taking care of, and invent new ways to corner new markets. That someone might as well be you.



Quint Studer not only teaches it, he has done it. After leading organizations to breakthrough results, Quint formed Studer Group, an outcomes firm that implements evidence-based leadership systems that help clients attain and sustain outstanding results. He was named one of the Top 100 Most Powerful People in Healthcare by Modern Healthcare magazine for his work on institutional healthcare improvement. Studer was named Master of Business by Inc. magazine. He is the author of BusinessWeek bestseller Hardwiring Excellence: Purpose, Worthwhile Work, Making a Difference; 101 Answers to Questions Leaders Ask; and Wall Street Journal bestseller Results That Last: Hardwiring Behaviors That Will Take Your Company to the Top. For more information, visit


About the Book:


Results That Last: Hardwiring Behaviors That Will Take Your Company to the Top (Wiley, October 2007, ISBN: 978-0-471-75729-0, $24.95) is available at bookstores nationwide, major online booksellers, or directly from the publisher by calling 800-225-5945. In Canada, call 800-567-4797. Copies also can be purchased online through the Studer Group website at