All business leaders say the way to staying upbeat is self-belief and surrounding yourself with people who are good sounding boards. Heron says self belief also comes from looking carefully at your strategy, reviewing it, and ensuring it still works.
“You need to stress-test the strategy to see if it’s pertinent. The strategy guides your business, it drives your business plan, and obviously your budget. If things are changing, the objective or output of that strategy may be altered or put to one side or readdressed.
“If you start from there as a leader, you start from what I would call your base of certainty,” she says. “Leaders need not be driven by the disease of fear. They need to confirm to stakeholders that they are in the driver’s seat.”
Should managers speed up the process and talk to their direct reports more often? Or should they give them more space? Business leaders say there should be no change, provided the lines of communication are good. Quick decisions are needed in good times and bad. But the critical part is ensuring there is an environment for open dialogue.
Cohen says: “I encourage every single employee in our company to be able to have direct access to me if they need to. I make sure there aren’t artificial barriers. You have to have your feelers on the ground.”
This gets a higher priority in a struggling economy, as expectations need to be treated carefully.
“You need to be active on all fronts, both inside and outside the organisation. I would be surprised if the good CEOs are in their office for more than 50% of the time. They should be out with their staff communicating, and communicating to the market about what it all means and the changes that need to happen,” Wilson says.
Cohen says investors are now more acutely aware of the issues affecting your business.
“They’ll read something in the newspaper and will want to know how that impacts on you. A year or two ago, they might have just absorbed that news. But today, some of the larger institutions are spending a lot of time researching each of the companies in detail, and they like to be informed.”
Getting some idea of what investors are going through is also important, as that can affect their relationship with the company. At Bakers Delight the investors are franchisees, and Caldwell says the company is keeping close tabs on them, to ensure their potential difficulties would not damage the business.
“One thing we need to be very cognisant of is what their own financial position is like, and whether they as individuals have suffered anything outside of Bakers Delight, whether the investments they have got have faltered and are placing them under stress. We haven’t seen that yet, but we are more cognisant of that than we have been in the past.”
Wilson sums it up bluntly: “The CEO is the person the customer most wants to see. It’s incumbent on the top echelons to be out there with their staff talking to customers and finding out what different value-added propositions they can deliver to help the customer get through.”
Caldwell agrees, saying it’s an opportunity to press home the company’s competitive advantages. “It’s about talking to customers and reminding them of the benefits of our product range, the benefits of our core service model, and the type of things you get at Bakers Delight that you can’t get elsewhere.”
Cohen says talking to customers and suppliers might also protect your own business.
“You need to do that all the time, but probably the only thing that is different at this time is that your customers could be affected by the downturn…we are in a business that fortunately in many of our markets is doing OK.
“We are not suffering, but you could have a supplier or a customer, or partner who might be suffering, or they have someone they are dependent on that affects them. You need to be more aware of what’s happening with them or their business and whether it impacts your business, or potentially does in the future.”
How do you strike the balance between keeping your best staff and managing payroll? Leaders say everyone knows these days that no job is secure. At the same time, they say they need to ensure that they have the best people on board to ensure they hit the ground running when the recovery comes. Wilson says that in the boom time, staff turnover was running at 20%. Now it has slipped to less than 10%, and will probably hit 5%.
To retain staff, companies need to make them feel valued. And in an age when people are happy to just have a job, bosses don’t have to give out too many bonuses. Striking the right balance between retention and redundancies, however, needs to be carefully managed.
“There are people who are not fit for the role or who are not performing so well, and you can only do so much before you move on to find someone else,” Wilson says. “That’s not the same language as an across-the-board staff cut on a Monday morning.”
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