What will you do when things go bad? - SmartBrief

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What will you do when things go bad?

Leaders aren't challenged by good times; it's how they react when things aren't going well.

5 min read



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There’s a lot to be worried about in business: the political climate, robots and automation, the future of entrepreneurism and innovation, the promise or peril of the gig economy. But imagine if we weren’t in an economy that’s been growing for years!

Like it or not, these are the good times, and that should make us concerned about how prepared we are, as leaders and companies, for the inevitable downturn. Maybe that time won’t arrive tomorrow or this year or even this decade, but it will. There’s always a downturn.

Why am I starting this post with such dire thoughts? Because leadership in these times is easy. You hire, you expand, you can talk all about motivating for excellence, building industries and helping people find a career and maybe a fortune. Technology is only a force for good (and productivity)!

This is also the time where you see many articles, books and TED talks about great leaders talking about why they are so great. Notably, they’ll throw in some tale of hardship, but it’s mostly about only success going forward, sprinkled with positivity and win-wins, maybe even win-win-wins.

In the bad times, none of that is the case. Revenue and profit suddenly are harder to come by. Customers leave you, if they even survive. You might be getting smoked by the competition, but that competition isn’t necessarily peer companies. It could be upstarts, regulation, foreign actors, a financial crisis, technological upheaval or even just terrible luck. Worst case, maybe you have no idea why things have gone bad.

Then, you’ve got to cut costs. That means laying off people, and not just the “bad” ones. Maybe your organization tries some new strategies and tactics, with varying levels of business intelligence behind these moves. All throughout, you’ve got to somehow keep yourself going, your team united and your company a going concern, when there isn’t a whole lot of optimism bubbling about.

Anyone can build and execute a strategy when money seems to be falling from the sky. It’s harder when none of the fundamentals seem to be going your way and everyone is distracted, angry, demoralized or all three.

On a personal level, how great is it to manage stars who do no wrong? A little more difficult when you need to ask the impossible of them because times are tough, when you need to lay off a good performer who’s done nothing wrong. How about when you have to pull back on perks, or training, or bonuses, or career growth? How about when you are automating their job – and they know it?

What to do before the crisis

Unfortunately, there aren’t easy answers, or else there’d never be recessions, bankruptcies or panics. All I can say is, start preparing now. This isn’t about being pessimistic just because. Enjoy the good times! Grow, invest, develop, and go big! But also, try and examine contingencies while deciding what kind of leader you’ll be in tough times.

At a strategic level, try thinking about mindsets, questions to ask and self-examination (Steve McKee’s series is a good place to start). Think about what you’d do if your organization started losing customers, or if a new competitor rose up or threatened to displace you. What if revenue fell by 15% and your main product was being commoditized? Would you just slash costs and people while grasping at any new product? Or, would you think about a better, more sustainable way to fight through tough times and come out ahead?

Likewise, play out similar scenarios that could hit you and your direct reports. What if automation could do 50% of your job, or your team’s? What are your options? What if you or your organization started losing great talent because of bad managers, or a lack of growth potential, or because they don’t believe in the organization anymore? What if you weren’t allowed to replace the next two people who leave?

Will you let frustration or doomsday thinking reign? Or, will you get to asking questions, trying new things, being that creative force that a leader is supposed to be? (Julie Winkle Giulioni’s written about career opportunity, the difference between robots and humans, and overcoming bad systems.)

Preparation is a big part of why people can keep calm during a crisis. Start now so that you can lessen the pain of hard times  — not just for yourself, but for many others.


James daSilva is the longtime editor of SmartBrief’s leadership newsletter and blog content, as well as newsletters for distributors, manufacturers and other professions. Before SmartBrief, he worked in newspapers for four years, where he witnessed the industry’s ongoing struggles with digital amid the great recession. Find him at @SBLeaders or email him.