Several weeks ago, my wife
and I spent time in Palm Springs, California, with family. While we were
“vacationing” the daytime temperature hit 125 degrees! It reminded us of the
reason why we had moved from the Arizona desert heat to Southern California. Living
in a place where the temperatures can make it so hot you can cook an egg on the
sidewalk, you learn to adjust your life to not only survive but be fruitful.
Leaders often feel the heat
when downturns hit their industry and survival is the preeminent focus of their
lives. Pressure from investors and boards often push leaders to make decisions
that seem correct at the time but in actuality, they produce negative results
for the organization. These decisions are often the result of fear.
Living in Arizona, the
summer months would push most people to stay inside their homes with the A/C
down, isolating them from the outside world. The thought of going out to spend
time with others, or engage in activities outside was dreadful. Instead, staying
inside and disconnecting for a “few months” was easy, but the results were
lapses in relationships, exercise, and discovery of new attractions.
The same is true for
leaders dealing with their own heat affecting their organizations. Instead of
looking outwards, they isolate the organization and start to cut budgets,
production, and labor. The fear of downturns or changes in the marketplace
creates a toxic organization that fuels uncertainty for the company and causes
fear to permeate in all levels.
The hope of Fall that brings
a relief from the Summer heat is seen in leaders of organizations that look
beyond the current issues with foresight to create a vision of an organization
that is successful. A leader that understands a couple basic principles for
leading an organization towards success as opposed to leading in fear will
quench the reservations of the organization’s investors and boards.
Capitalize on Opportunities
During the summers in
Arizona, people that are fruitful in their daily lives see the various
opportunities that others miss. Swimming pools can be seen throughout the city;
however, most pools go unused during the daytimes of summer. To some, the pool
becomes a great place for an evening swim, a place to enjoy the sunset. The low
humidity of Arizona along with the water provides refreshing relief from the
daily 100 degree plus temperatures.
For others, golfing during
the summer is like Christmas day. The opportunities to golf at some of the
nicest courses in the area for up to 50% off provides great opportunities for
people to enjoy time outside in the early morning or late afternoon, when the
heat is not as intense. The people that barricade themselves in their homes all
summer do not see these opportunities as positive and often find summer
difficult to get through.
The same is true in
business. Bob Legge of Legge & Co. said, “Economic
downturns are actually the best time to rethink your business strategy and gain
a big advantage over your competitors.” While other organizations are turning
inward and cutting budgets, products, and labor, leaders of successful
organizations look to capitalize on opportunities that present themselves and
establish them as a leader when the market changes. Opportunities can include new
product creation and innovation, expanded marketplace presence, and talent
development. These areas can be overlooked when an organization is moving
forward but also are cut when an organization is in a downturn. It is the
leader that can push one or more of these areas forward who will reap the
benefits on an organization that not only survives but also grows and has the
potential to lead its industry.
Routine Re-Evaluation
Not only do people in
Arizona look for new opportunities for enjoyment during the summer, they also
re-evaluate their daily routines. One such change is seen in the morning with
the breakfast meeting and gathering a large part of the community. In their desire
to spend time with people in relationship, the locals will often meet for
breakfast before it gets too hot to enjoy food and fellowship.It is not that people start
having breakfast during the heat. It is they change their routine about
breakfast and by choosing to get out of their house and develop their
relationships.
The same is seen in organizations with progressive leaders. During a time of “heat”, a successful leader will look at current processes, programs, and departments and reevaluate their impact for the long-term success of an organization. There are organizations that do this out of fear but a leader that understands the need to let go of unsuccessful items and replace them with new processes is beneficial for an organization.
Vijay Govindarajan, in his book The Three Box Solution, describes this action as a “Box 2” item. Vijay describes Box 2 as; it helps an organization “escape the traps of the past by identifying and divesting businesses and abandoning practices, ideas, and attitudes that have lost relevance in a changed environment.” The perfect time for a leader to forget about the past is when an organization is negatively affected by changing dynamics of the market and look to not only survive but also grow. Hylke Faber, the founder of Constancee, said this about Box 2 decisions, “As soon as I find the courage to say good-bye to a past that no longer serves – not looking back, flexing my Box 2 muscles – I’m ready to take my first step into my new future.”
The courageous leader will lead an organization to success, while a fearful leader will create a toxic environment that results in decline and potential organizational death. Warren Buffet once said, “Be fearful when others are greedy and be greedy only when other are fearful.”
Fear or Prospect
As a leader during a time of “heat” or downturn, you can influence an organization from the position of fear or the position of prospect. The decision is yours, the leader. Do you want to lead from a position of fear that creates a toxic environment? Alternatively, do you want to lead from a position of prospect that produces an environment of innovation, creation, and development? It boils down to a decision to expand the organization or end the organization. Where will your organization be when the heat is over?
