Last week I wrote about learning from the best of times, and so this week seemed appropriate to take the contrarian view. What have I learned from the most challenging of times, and how, with hindsight, should you navigate choppy waters?
My first piece of advice is uncharacteristically emotion based. When your business plan goes materially wrong there will often be a good deal of bad luck, uncontrollable events or external factors hitting you. While it is important to rationally process the true extent of that, your visceral emotional reaction can be overwhelming. It can be very easy for a team to spend a lot of energy on how it’s unfair, post-rationalizing how impossible it was to see factors coming and underneath it all be hoping you can just get back to normal as quickly as possible and carry on as before. This leadership moment is crucial. The faster you can reset and turn the page the better. The priority is to look with fresh eyes at the situation, as it really is today. Get the best possible understanding of what has changed and what needs to be done. It is so tempting to stay too long in the past. To debate what’s fair. To long for what might have been. This is a decisive leadership moment. If you don’t turn the page, nor will your team. In the most important moment, you will divert your collective energies to the wrong place.
Second, the cliché is that profit warnings come in threes. Why is that? It is human nature to underestimate the problems and to overestimate your reactions. With bravado you can quickly feel all it needs is a quick intervention. Fast fixes fail. Tactical responses to strategic issues don’t last. Find the bottom as quickly as you can, so that all your energy can look up and forward. Don’t waste a single moment chasing numbers. That energy is far better spent on the right recovery plan with a steady cadence. Create space for the recovery. This makes all the difference to the level of disruption your organization bears. If you under call the problem and overstate the solution, you will create endless churn and firefighting. Ultimately to no use. If you get all the bad news behind you and set a steady path out, you can offer stability to your team and protect much of what has been working, rather than put it at risk.
In the right conditions a thorough reset is an opportunity to double down. There are new degrees of freedom from reacting to a crisis if your plan is well thought through and practical. It is a time for fresh thinking and new ideas, but actions speak louder than words. So, you need to be ruthlessly focused on what will really move the needle so that you don’t waste the time with distractions. You also need to filter ideas aggressively on actionability so that the challenges of the new reality aren’t met with conceptual responses. This may sound harsh but so many turn to big consulting firms in these moments. Not only does this delegate responsibility away from you and your team, but it also puts your recovery in the hands of 25 year-olds doing Excel and PowerPoint.
Instead, use the situation to unite and re-energize your team. Learn about the problems and create the solutions together. Transparency, honesty, objectivity on what needs to change. Lose some of your old orthodoxies and increase urgency towards a few actionable outcomes. Act like founders, not corporates. Take real ownership, keep perspective on the long-term prize and purpose, and lead people through to the other side. It comes faster than you think. It builds more than your business. It builds your team, culture and future potential together.