January 12, 2009

Good day, team,

Last month, I worked with a client and his team at an off-site meeting in California for two days. I’ve been working with individual members of the team since last April, so I was glad to have the chance to work with them all together. At lunch on the first day, a group of us were talking about current economic conditions and how difficult it was to get people to make decisions or commitments. There’s a prevailing attitude that we haven’t hit bottom yet and, given that thought, many find it hard to commit to projects and expenditures.

At some point, one of the team members turned to me and asked, “Well, isn’t this downturn in the economy affecting your business? I mean, it seems like most people see coaching and the development of their team members as a ‘nice to do’ rather than a necessity, and in the current state of things, we keep getting the message that unless it’s absolutely critical, we can’t do it.”

I replied that yes, some clients were cutting back, but others—like his boss— believed that now was the best time to help people enhance their skills and focus on their development. As his boss had said to me, “I want to take this time to concentrate more on helping my people develop personally and professionally. Frankly, we never have the time to do this when things are going really well. We don’t have the luxury of thinking about our own development when we’re busy just trying to keep up with supporting the business.”

I was impressed with my client’s ability to continue to see the value of professional development and for taking advantage of a slowdown in business to invest in his team. Synchronistically, as I traveled back to Portland, I picked up the December 2008 issue of the Harvard Business Review at the airport and randomly opened it. An article titled “Unconventional Wisdom in a Downturn” asked, “What best practices challenge the conventional wisdom about what to do in a downturn?”

Here are the answers to that question from the Harvard management team members who oversee the publication’s blog:

1) Protect strategic expenditures: Many executives react instinctively during economic slowdowns and cut discretionary spending across the organization. This slash-and-burn response is a big mistake because it fails to make the distinction between short-term operational and long-term strategic programs. Their attempts to cut fat and waste often slice into newly growing muscle, bone and tendon. The Harvard blog at harvardbusiness.org offers great suggestions for helping companies preserve and strengthen their strategic programs.

2) Dial down the stress level: The knee-jerk response in an economic downtown is to wring greater productivity out of people and to make them work harder for less. This just fuels resentment and burnout. A smarter approach is to be more open with employees about the business problems you face and invite them to be part of the solution. The bloggers also suggest encouraging your employees to meet critical needs in other parts of their lives so that there’s a recognition on everyone’s part that we’re all in this together, supporting each other.

3) Use downtime to enhance skills: A downturn represents an opportunity to learn something new, or to unlearn what’s become obsolete. Often managers say, “Are you kidding? When times are tough, professional development is a luxury.” Not so. Often that’s precisely when there is enough breathing room in the daily work flow to give people a chance to better themselves. Such professional development pays off most with employees whose team skills are poor but whose impressive individual performance precludes letting them go. They have already shown the level of commitment that makes them hungry for new skills and professional development. A small investment in them pays off hugely when you teach great individual performers to collaborate more effectively and the overall organization gets the message that, even in a downturn, your people are your greatest competitive advantage, so you’re more than willing to invest in them.

4) “Give me the ball” is the wrong answer: It’s no surprise that during troubled times many leaders believe it’s their responsibility to call the shots and personally execute the plays. The instinct to drive greater control is predictable. But in doing so, they end up hogging the ball instead of tapping into ideas and opening up to the team’s view of how to make the next best play. The article encourages people to take this time to ask great questions, build trust within the organization and challenge the status quo. They encourage leaders and managers to share obligations broadly during downturns to give their people more opportunities to become spontaneous and innovative. Don’t be afraid to pass the ball.

5) Discounts can be dangerous: During hard times, companies often rush to reduce prices on products and services. But discounting has its perils. The price of something is often an important determinant of its perceived value. If you discount prices purely to boost sales, buyers may begin to question the value. Consider Abercrombie and Fitch, which lowered prices by roughly 15 percent during the 2000-2002 downturn. When the dust cleared, the company realized it had sacrificed much of the brand’s cachet and lost significant market share. Discounting is not a bad idea, but you want to stay away from eroding the value of your brand. Offering discount gas rather than discounting the car is one of the few good decisions Chrysler made last year. The discount didn’t devalue the company’s main product, it just encouraged people to buy the car for the benefit of getting cheaper gasoline.

I thought about these suggestions and realized that, overall, doing any one of them goes against the knee-jerk reaction we have to fear and uncertainty. It requires us to go beyond our instinct to control, to hoard, to protect, to withdraw and to fixate on what we lack rather than what we already have.

Your challenge this week is to think of ways in which you can take the above-mentioned suggestions and integrate them into your work environment. Try broadening your approach—rather than stifling yourself and others—by being more open and willing to share and collaborate.

Living our lives from abundance rather than scarcity is possible even in the most dire circumstances. Nelson Mandela has observed that his years in captivity taught him many things. Once everything had been taken away, he finally realized the importance of that which he could never lose: his ability to love, to share the little that he had, and to try to make the most out of each day as it came.

Have a good week!


Kathleen Doyle-White
Pathfinders Coaching
(503) 296-9249

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