A recent article in McKinsey, which was based on a series of interviews with 14 CEOs and Chairmen of big companies like 3M, Tyco, Pepsi, P&G, and Sysco, described some emergent leadership lessons for hard times that was a good read. The harder times get, the more important good leadership is. Anyone can lead during a boom when consumers are spending freely and impulsively … but it takes a special type of leader to lead when the sky is falling all around you.
While not a complete list of lessons that a leader needs to learn, the following five lessons that emerged from McKinsey’s discussions are definitely critical.
- Confront Reality
The sooner you accept reality, even if it is a drastically constricting market, the sooner you can start dealing with it. The first company to deal with it is often the winner. - Put Strategy First
Strategy should be the first item on the agenda of every board meeting … and you should be taking advantage of everything your board members have to offer. - Be Transparent
At all levels. You will need the support and trust of your employees to make it through … and that will require regular, open, communication. Openness builds respect, trust, and solidarity which in turn helps employees stay focussed. - Build a Culture
A culture binds a company together and helps to create trust. - Keep the Faith
Even a crisis has opportunities, and since the nature of markets is that they follow up and down cycles, things will eventually get better.
And whatever you do, avoid the axe. Use a scalpel if you must, but never the axe. Chopping off the arm when you only needed to remove a finger just doesn’t make sense.
For a much deeper discussion, refer to the article. While a bit lengthy at 6 pages, it’s definitely worth it.