Seven Strategies to Lead Your Team through the Recession

By Vistage speaker Ian Cook and leadership development expert Scott Campbell

When your employees are worried about layoffs, they gossip and commiserate about what they think is going on in the company. Sadly, this activity tends to reinforce negativity, pessimism, anxiety and stress, with the ultimate outcome of poor performance and diminished productivity.

Turning this trend around requires leadership that keeps employees engaged, focused, and productive in the midst of turbulent times. Here are seven leadership responses that increase performance:

1. Pay attention to the messages you’re sending

During high-stress times, employees can question your messages and wonder whether you’re telling them the truth or have a hidden agenda. They closely monitor your level of confidence and your attitude towards the crisis.

Communicate to your employees what’s still working, highlight your company’s strengths, and proclaim your confidence in your people. And remember, your decisions must be perceived as fair to all. It’s difficult for employees to see co-workers let go while executives maintain their pay levels and perks. Pain needs to be shared between all in tough times – and it must be perceived as shared.

2. Make the tough decisions quickly but don’t just react

Once you make a decision, announce and implement it as quickly as possible. Otherwise, erroneous rumors will spread with lightning speed. Anxiety will spike, resentment will build, commitment will decline, and trust will evaporate.

That said, pressure and worry can prompt us to react without thinking about the long-term impact of our decisions, particularly when it comes to layoffs. Reducing head count saves money, but it can be costly in other ways, including:

  • the loss of good people,
  • greater stress from increased workloads,
  • decreased morale, and
  • lower levels of service.

Use layoffs as a last resort. Consider alternative measures such as reduced hours or job sharing.

3. Focus on the vision
Pursue your vision even in the midst of adversity with the following actions:

  • Balance crisis-driven short-term decisions with long-term, strategic objectives.
  • Be alert to opportunities that may arise in the midst of the crisis. For example, if delivering outstanding customer service is a core part of your vision, look for opportunities to provide extra service to key customers who are also hurting. This will actually deepen their commitment to your company, providing you with a powerful competitive advantage in the long-term.
  • Share your vision with your people. Focus them on the critical things that need to be done today.

4. Keep people informed
Communicating openly, frequently and as candidly as possible is never more important than during difficult times. Employees want and need to feel a closer connection than usual to their leaders. People prefer difficult news to no news. Also:

  • Increase the visibility and accessibility of your leadership team members.
  • Use email, company intranets, newsletters, and other means to keep people in the loop.
  • Hold town-hall type meetings, department meetings, and lunch discussions where people can ask questions and have their concerns heard. Acknowledge those concerns.
  • When people grossly exaggerate the likelihood of a negative outcome, calmly suggest that that possibility is very remote.

5. Involve people with today
The busier your people are, the less they will be inclined to dwell on negative, “what if” thinking.  Here are some tips:

  • Recognize and celebrate small victories and concrete accomplishments. This builds morale and creates a sense of momentum and progress.
  • Encourage employees to look for opportunities to do things more efficiently or try something new.
  • When you hear someone complaining about something, gently reframe their thinking by first acknowledging, “Yes, it is frustrating.” Then, focus them on those things they can control or influence by asking, “What can you do about it?”

6. Demonstrate caring – even when letting people go
In global research conducted by the Towers Perrin group, the number-one driver of high employee engagement is a sense that the leaders of the company genuinely care about the well-being of their employees. (Towers Perrin White Paper, Managing Amid Market Turmoil: Top Priorities for Business and HR Leaders.)

When you must lay employees off, how you treat them is crucial. With a thoughtful and caring downsizing process, those who remain will respond with increased commitment to your organization, knowing their colleagues were treated as fairly as possible.

7. Invest in your leaders and key players
It’s easy to ignore your best performers during tough times, relying on them to do their jobs while you focus on managing the crisis.

Due to their professionalism, your top performers may not complain to you but, rest assured, they experience the same anxiety and doubts that everyone else does. Furthermore, if your A-players feel ignored or taken for granted, they may consider greener pastures elsewhere. Make sure you stay connected to these individuals, emphasizing the role you see them playing in the future.

Remember to coach your mid-level managers and supervisors on how to talk to their direct reports when negativity, resentment and despair arise.

As for your top leadership team, spend time building cohesion, perhaps in a mini-retreat type meeting. Encourage them to articulate and address their own fears, re-affirm their belief in the enterprise, and, together, commit to successfully bringing the organization through the dark times to a brighter future ahead.

Taking care of your leaders and your top talent will give your organization an immediate and enduring edge over your competition. Tough times do end. That’s the good news. But until they do, effective leadership is one of the few keys you have to surviving and ultimately thriving.

These seven leadership responses offer a roadmap to navigating this tumultuous environment and arriving at the best possible destination on the other side.

Vistage speaker Ian Cook works with managers who want to increase their effectiveness as a leader and build a stronger team. He and Scott Campbell offer leadership development programs customized for both executives and mid-level managers. Find out more at Leadership: The Enduring Edge

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