You’ve undoubtedly been hearing all the talk about the possibilities of a recession and over the last couple of months, economists are now predicting there is a significant chance of that happening over the next year. There are some things that we should do in preparation.
But first, to get into the proper mindset, there are a few facts to help us see the “silver lining” in this troubling economic forecast. And, if it doesn’t happen, you still will be far better off if you begin working on the recommendations presented in this week’s newsletter.
Some Interesting Historical Data
Fact #1: 17% of the 4,700 public companies presented in a 2010 HBR article “Roaring Out of Recession” went bankrupt, went private, or were acquired. But just as striking, 9% of the companies outperformed competitors by at least 10% in sales and profits growth.
Fact #2: Bain & Company in a similar analysis, found that the top 10% of companies saw their earnings climb steadily throughout a period of recession and continued to rise afterward.
Fact #3: A third study by McKinsey found similar results.
The difference maker in the successful companies was their preparation. The not-so-good companies switched into a survival mode when recession hit, making deep cuts, and reacting in a defensive manner.
It’s Time to Reframe Our Attitudes and Mindset
Think of recessions as a high-pressure exercise in change management. This means to navigate one successfully, a company needs to be flexible and ready to adjust. For many companies that are deeply rooted in process and precision, or are highly competitive and results driven, a shift in mindset needs to happen to see opportunity in a down market.
There are some inherent vulnerabilities that leaders have to manage against when companies are faced with high-pressure change management situations during a recession:
- Department leaders compete for resources and budget.
- Department leaders do not regularly collaborate with one another.
- Teams across organizations fail to pursue goals together.
- Organizations lack clear goals, which makes recognizing progress difficult.
- Company cultures tend to restrict frequent collaboration.
Operating in this environment requires strong conviction to you and your team’s true purpose and the ability to navigate some difficult and uncertain situations.
Does Your Boss Like You?
The cold hard truth is that it really matters what your boss thinks of you. It’s time to figure out how to maximize your value to your boss.
Sounds simple, but many mid-level leaders take a backseat when confronted with problems and rely on others to fix the issue. There are many ways for leaders at all levels to expand their sphere of influence and become a stronger asset to the boss. Here is what Top Ten Percent Leaders do:
- Create a perception that they are always present, never late, never too busy to engage when a problem arises. Remote employees are especially at risk because they are missing opportunities to engage in-person; their geographical separation creates a bigger obstacle for them, so they naturally have to work harder to create this ever-present perception.
- Be thorough and efficient. Your team needs to deliver the goods. Some studies have shown that as many as 45% of leaders don’t fully understand all of the deliverables their direct reports are responsible for. That means that 45% of leaders do not have an efficient management operating system. How can you manage your team if you don’t know how your teammates spend their time? These leaders cannot effectively, forecast, plan, or assign work properly. There are some simple ways to evaluate your management operating system and bear in mind that your management operating system will evolve as the company navigates inevitable changes during a recession.
- Practice Effective Communication – active listening; ask the right open-ended questions; steer those you are communicating with toward a solution and action. Communication done correctly, is the leader’s superpower.
- Volunteer to Lead. Do you have an appetite to task risk and the capacity to learn new skills? When you search for opportunities to lead and expand your sphere of influence, you will increase your visibility in the organization. You will gain more trust with your boss as you complete these new initiatives and bring value to the organization. Leaders that don’t speak up and remain on the sideline are simply not seen as adding value to the organization. Get in the game!
- Be upbeat and encouraging. Work alongside your team and keep your team focused on making progress on the most important priorities. When your teammates feel you have the situation under control, your boss will notice.
- Seize opportunities to talk with the boss. Take responsibility to find ways to interact with your boss in ways that are helpful to the both of you. This allows you to develop a relationship, an emotional connection that leaves him with a better understanding of who you are.
- Take the opportunity to check in with each of your teammates, at least once every two weeks. Leaders that have frequent 1:1's with their teammates improve employee engagement and achieve greater alignment between the organization’s objectives and individual goals. Well-structured and consistent 1:1’s can have a powerful impact on your team.
Monday Morning Actions
After you reflect on some of these recommendations you will want to take action and begin your journey in preparation for the next cycle. Our economy, your industry, your company, and your job will experience as change is a constant in all businesses. Regardless of 2023 being a year when the economy goes into recession, these recommendations will serve you well no matter what happens.
Take charge and bulletproof your job!
DiBona & Associates helps businesses enhance the productive output of key personnel, teams, and organizations. We are a productivity improvement services provider acting as advisors, consultants, trainers, and implementers.