In last week’s blog, I reported some stark statistics revealed by the Harvard Business Review (HBR). Over the last 3 recessions, approximately 80% of companies had not regained their prerecession growth rates for sales and profits three years after a recession ended. Another 17% of companies didn’t survive…they went bankrupt or were acquired. So where does that leave the few stellar companies that actually prospered during a recession? They left the competition in the dust.
The “new” normal
With the current recession that began in late 2007, most company CEO’s realize the “old way” of doing business no longer exists. Their priority now is to restructure their organizations to cope with the “new normal.” How do leaders go about initiating change and reinventing themselves? By getting their employees on board to champion and lead the way to change.
Improperly trained managers
In the aftermath of the Great Recession, many organizations have come to realize they now face a large leadership preparation gap. During the recession no training was conducted while mid managers and supervisors, along with employees, were downsized. No one was supported in their leadership positions or received the proper training to effectively manage teams through unknown waters. Many companies have now turned to work station based training as a cost effective way to bring managers and team leaders the resources and tools they need to succeed.
Listed below are the challenges we touched on last week that most businesses will face coming out of the recession. This week, let’s look at how businesses can find a way through those same challenges.
- Business Infidelity – Every company must acquire the secrets to maintain solid business relationships by utilizing strategies to ignite the spark, fire, and passion with their clients, employees, partners, and vendors. Leaders must foster improved business relationships throughout the business to facilitate LOYALTY to create, retain, and sustain healthy positive business relationships. The HBR study revealed that morale is usually better at companies that stress operational efficiency over massive layoffs. Employees at these companies appreciate top management’s commitment to them and they are more creative in reducing costs as a result. Progressive companies also stay closely connected to customer needs when making business decisions.
- Social media – Leverage your human capital to outwardly communicate your corporate values and culture and reinforce your brand. Empower your employees, improve retention, and attract highly qualified candidates into the fold. Giving your executives a public face on social media can also benefit both the business (via hiring, retention, and growth) AND your executives.
- Communication Malfunctions – Understanding behaviors, judgment, and what drives individuals are all keys to helping team members traverse through the stages of group formation. Understanding how behaviors affect different people in each stage is vital to achieving outstanding team performance. Behavioral styles, motivational factors, value judgment, and how they influence individual relationships and team performance, all play a large part in communication and civility, or lack thereof, in the workplace.
- Mismanaged Human Performance – Evaluate every job and potential new employee for a better fit and performance potential. Predict which candidate will have a greater chance of performing in a given situation. Use the information gathered to coach and mentor others so they become better performers.
- “Hiring to Fill” Quick Fix – True success and excellence come from a strong dynamic team – one built on similar beliefs, strong ethical values, and behaviors that mirror and complement the overall company culture…not one built on ‘gut feel’ hiring decisions. Understanding company culture, identifying the key elements of the position being sought, and determining the profile of an ideal candidate is the foundational groundwork for a successful hire.
- Not Recognizing Every Employee is a Salesperson – Businesses are always involved in sales interactions. Making daily decisions to either gain a benefit or avoid a loss are to be expected in the decision-making process. So, it benefits all employees to recognize the unconscious beliefs about sales that hinder profitability in business and how to overcome those negative beliefs easily, effectively, and pain-free.
- Can’t Regroup Fast Enough to Retain Valuable Employees – The first task is to capture the emotional commitment of the key leaders quickly. The second is to engage the rest of the employees to champion change initiatives through inspiring stories and communication updates on the change effort progress.
- Lack of strategies for Unexpected Changes – Understanding a company’s purpose, which is different from its vision, goals, and objectives, is critical to keeping employees engaged and retained. Purpose is the meaning, intention, and reason for a company’s existence. As change happens and businesses evolve, savvy business leaders revisit the company’s purpose, build on it, or change it. They ask themselves, “Does the reason for which the company was created still exist? Do I as a leader have the same sense of resolve or determination for my work as I once did? Does the company’s work give meaning to those who work here in addition to providing a paycheck?”
Finding a way through a recession is wrought with perils and dismal survival statistics for most businesses. However, companies equipped with the knowledge and tools to quickly and efficiently regroup are posed to charge out of the recession gates.
Next week, we will wrap up our 3 part series with “What’s Possible” for organizations when they find the formula for thriving and succeeding the Great Recession.
Join me and other industry thought leaders for a break-through summit coming December 2012 “Engagement, Retention & Growth: 10 Strategic Solutions for Sustainable Corporate Expansion and Retention.” We expand on and provide the steps to overcome the challenges, find ways through the recession storm, and the possibilities that await each business as they go from surviving to thriving.
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