Leading in Hard Times

 

Les Trachtman agrees, based on his experience as CEO at Transcentive, a Shelton, Connecticut-based provider of equity compensation management plans. He initiated two rounds of layoffs in the past year, the first one comprising 18% of the company. Still, he says, morale isn't down. "We've been working very hard at keeping morale up," he explains. "I've found that as long as we dealt with employees fairly and were up-front about what was happening, people are pretty understanding. We made sure they understood why it was necessary. We honestly explained the rationale and the facts." He also involved managers in the downsizing decisions. "We made sure managers clearly communicated to their employees that they (the managers) had been involved in the layoff decisions, and were on board with it. Employees then understood that decisions were being made with full knowledge, because the manager who knows them and their work was helping to make the decisions."

4. Find your company's communication "sweet spot."
Not only is the way you communicate important - but how much you communicate is important, too. "Finding the sweet spot means figuring out what's too much communication, and what's too little," Clifton says. "Find out what combination of reassurance and facts is best for you. Each company is different. You have to find where that sweet spot is for your own company." What's the sweet spot for Clifton? She sends a monthly newsletter to all her employees giving an update on what the company's doing, and on which goals set out in past newsletters have been achieved. "I've found that the newsletter needs to be no more than one page in length, even a little shorter than a page," she says. "And it can't be full of warm and fuzzy stuff. People want the facts." She also periodically sends e-mails with updates.

Mann, too, has a philosophy on how best to communicate with his company. He says, "I've found that the best method is to use the greatest brevity in writing, and the greatest comprehensiveness in oral communication."

5. If you make changes, you need to show improvement ? quickly.
If you're making changes to try to improve business -- especially if those changes involve sacrifices like layoffs or reduced wages -- you need to quickly show positive results. Clifton makes sure that her employees are aware of positive results as soon as possible. "When I make a change that I know is going to help the company in the long run, I often tell employees - either in person or in one of our newsletters - that the changes being made are 'making us stronger as a company," she explains. "And when the proof that we're getting stronger is evident, we really celebrate it. Maybe it's a new, big client; maybe it's a dramatic improvement in productivity numbers. Whatever the case, if you make that kind of claim - that the changes are going to help your company - then you'd better show radical improvement, and quickly. For us, anything longer than 3-4 months is too long."

Lastar CEO Shane agrees: "It's a 'show-me' situation."

6. Re-focus on your customers.
When times are tough, company leaders and employees should reconnect and keep in touch with customers more than ever. "When things starting getting bad in the economy, we created a whole new team called 'Customer First' that proactively contacts our customers and sets up a sort of customer concierge in an attempt to increase the bandwidth of our communication and the richness of our customer relationships," says Trachtman. "No selling, just seeing how we are doing."

Trachtman's been hitting the road, too. "Most of my plane trips have been to see existing customers, and just shaking their hands, asking how we are doing, and thanking them for doing business with us," he says. " We have 3000 of the finest companies in the world as our customers and figured that if the economy was going south we ought to protect the gold vein of our business, our existing base." This focus on customers has set employees' minds at ease because it demonstrates that the company's priorities are in order - that the company isn't spending so much time on capturing new business that the existing customer base gets short shrift. And he lets employees know that it's working. "We try hard to publish success stories internally from these efforts," he says. "Everyone (especially me) loves to hear clients say nice things about us."

7. Be visible.
Trachtman has been spending a lot more time walking around the office. Mann now has many more one-on-one meetings, and fewer all-company or group meetings. Other CEOs we spoke with said they've done the same. They keep their doors open, walk around the office, and talk with employees. If you're not visible, you give the impression that you're hiding -- and employees will wonder what you're hiding from them.

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