What Companies Can Do NOW To Weather The Slump
Struggling in this downturn, organizations seem to have few options other than cutting costs, husbanding cash, and lowering debt relative to revenue. However, there is an effective line of action few, if any, companies have considered: the development and execution of a Leadership Strategy.
By Brent Filson - 11/2008
As the economic sky falls, I’m reminded of a framed inscription that stood on Winston Churchill’s desk during WWII. It said, "It’s not enough to say we are doing our best. We must succeed in doing what is necessary."
Other than the typical knee-jerk, cost-cutting reactions – layoffs, capital expenditure curtailments, budget freezes – what can companies do immediately to get through this crisis?
The answer is simple, and it’s staring most leaders right in the face. Yet they don’t know the answer even exists.
It’s to develop and execute a Leadership Strategy.
A Leadership Strategy -- I bet you haven’t heard of it. It certainly isn’t taught at business schools; yet a Leadership Strategy can be far more important than a standard business strategy.
And it can be the vehicle for negotiating these economic white waters.
The Leadership Strategy can:
- promote the least expensive but most effective capital investments,
- get your company quickly adapting to changing marketplace conditions,
- activate the passionate commitment of the grassroots of a company where the value of that company interacts with the changing dynamics of the marketplace,
- get the entire company working as a single, inspired unit,
- promote immediate and long-lasting increases in shareholder value and earnings growth.
What’s a Leadership Strategy?
You know that a business strategy seeks to direct a company’s activities around a central, animating ideas.
A Leadership Strategy, on the other hand, seeks to obtain, organize, and direct the heartfelt commitment of the people who must carry out the business strategy.
The business strategy is sail, the Leadership Strategy ballast. Without a Leadership Strategy, most business strategies capsize.
To give you a personal idea of what a Leadership Strategy is, let’s look at your past company initiatives.
Divide a single sheet of paper into two columns labeled A & B. At the top of column A write "business (or organizational) strategies". On top of column B write, "Leadership Strategies" -- in other words, what strategies were used to obtain people’s heartfelt commitments to carry out the business strategies?
Think of the strategies your organization has developed during the past few years. They might be product strategies, service strategies, growth strategies, sales strategies, marketing strategies. You do not have to explain it in detail, just give each strategy a tag and write down the tag.
Did the listings in column A match the listings in column B? Were there any listings at all in column B? That gap between what was in column A and what was in column B is a killer gap. It means that the business strategies haven’t been augmented by Leadership Strategies. And when that happens, results suffer.
Here, then, are four steps to developing a Leadership Strategy.
1) Get your business strategy right. Because a Leadership Strategy taps into the strong emotions of grassroots employees, it is like a kind of organizational nitroglycerine. If you handle the Strategy the wrong way, those unleashed emotions could end up blowing up in your face.Your business strategy must be realistic, honest, and compelling. If that strategy runs counter to the grassroots’ interests, the powerful, positive emotions you seek to harness will become powerful, negative emotions against you.
2) Identify the dream(s) of your cause leaders. Yes ... dreams. These new times call for new concepts and new actions. To seize the new opportunities of the Leadership Strategy, you must come to grips with the dreams of your employees.
Dreams are not fluff but the stuff that hard, measured results are made of.
Mind you, leadership is motivational or it’s stumbling in the dark. The best leaders don’t order people to do a job, the best leaders motivate people to want to do the job.
The trouble is the vast majority of leaders don’t delve into the deep aspects of human motivation and so are unable to motivate people effectively.
Drill down through goals and aims and aspirations and ambitions, and you hit the bedrock of motivation, the dream.
Dreams are not goals and aims. Goals are the results toward which efforts are directed. The realization of a dream might contain goals, which can be stepping stones on the way to the attaining dreams. But the attainment of a goal does not necessarily result in the attainment of a dream.
For instance, Martin Luther King did not say, "I have a goal." Or "I have an aim." The power of that speech was in the "I have a dream".
Dreams are not aspirations and ambitions. Aspirations and ambitions are strong desires to achieve something. King didn’t say he had an aspiration or ambition that " ....one day this nation will rise up and live out the true meaning of its creed: ‘We hold these truths to be self-evident, that all men are created equal.’" He said he had a dream.
If you are a leader speaking to people’s aspirations and ambitions, you are speaking to something that motivates them, yes; but you are not necessarily tapping into the heartwood of their motivation.
After all, one might aspire or be ambitious to achieve a dream. But one’s aspiration and ambition may also be connected to things of lesser importance than a dream.
A dream embraces our most cherished longings. It embodies our very identity. We often won’t feel fulfilled as human beings until we realize our dreams.
If leaders are avoiding coming to grips with people’s dreams, if leaders are simply setting goals (as important as goals are), they miss the best of opportunities to help those people take ardent action to achieve great results.
3) Create a Shared Dream. The Shared Dream is the fusion of the senior leaders’ vision and the people’s dream.
After all, senior leaders should have a specific vision of where they want the organization to go. Grassroots employees always have a dream of where they want to go. Until the vision of the company’s leaders and the dream of employees come together in a Shared Dream, companies stumble.
Take the classic case of cost-cutting vs. job security. When the senior leaders’ vision of cutting costs through layoffs clashes with the job security dreams of their employees, that company cannot be the single, highly effective, motivated unit it should be to negotiate these hard times.
(4) Turn the Shared Dream into a Leadership Strategy. A Leadership Strategy cannot exist without a Shared Dream; yet having a Shared Dream is not enough. It must lead to action that obtains results.
The Leadership Strategy is the Shared Dream manifested by an action plan.
The action plan should establish a)clear identification of the targeted results b)actions to be taken to achieve the results c) monitoring and evaluation systems to make sure the results are on track.
Clearly, in today’s economy, companies must " ... succeed in doing what is necessary." Cost-cutting and cash-hoarding, traditional ways of dealing with a downturn, are not enough. When companies turn to the benefits of a Leadership Strategy they’ll be doing what’s right in accomplishing what’s necessary.