Posts Tagged ‘Downturn’

Real Power is People

Thursday, April 8th, 2010

During these tough times of downsizing and cut-backs the affects on the people within a business can be pretty devastating ~ stress, worry, concern, to name just a few of the harmful downsides.  It’s at times like these when it’s important to know in detail the skills and attributes of everyone who works within the company, in order to ensure a balanced portfolio of skills, attributes, drive and enthusiasm going forward. 

To do this it is worth focusing on the skills necessary to make the company rounded and successful in the short and long terms.  These are generally obvious; there are the accountants, the engineers, the attorneys, the techies, the marketers, etc.  All of these are people, above all but are in the positions that they are in because of the qualifications that they earned through the education system, their years of experience at your company or others and the personality traits inherent to them as individuals to enable them to take these specific roles within an organization.

But what of the managers, directors, the President of the company, the ones who have led their troops through downturns such as we are currently experiencing.  What skills does a manager or director need?  Where would you go to get educated in the art of general management? 

I would suggest the only place is the, “University of Life,” in this the fourth year of the downturn.  Why do I take this view?  Because general management is and always will be about managing people.  Managing people with the skills listed above, not managing them as individuals but molding them into a cohesive, integrated, strategic, solid team.

The general manager or director in the current circumstances is under probably more pressure than anyone else in the organization and uniquely that pressure comes from above as well as below.  Handling this type of pressure requires a special skill set.  Not those that can be learned in college or even read in a book.  These skills are probably inherent in the individual and are honed over the years through mentors and through experiences and more importantly learning from these experiences.  No two days are the same, maybe that is part of the appeal, but the greatest appeal is the opportunity to interact with people, the team.  The team is made up of a myriad of personalities that all have their own needs and concerns as well as skills and abilities.

The skill of the manager comes to the fore when it becomes possible to release the power of the people ~ through persuasion, motivation, praise, clear, concise instructions, support and trust.  It certainly rarely brings out the best results when finger pointing, bullying and power are utilized. 

Managers usually fall into three categories.

  • First, those with a natural aptitude in working with people and these are the folks that would employ the tactics quoted first above. 
  • Second, those who have taken the job for the power, the bullies.  These are the people who generally fail and do you know what?  It is usually the people they are managing that cause them to fail.  That’s the negative power that forms the backlash to a huge ego.
  • Third, the one who wishes they’d never been appointed.  The great accountant or engineer that was so good at their job they were appointed as a manager ends up completely out of their depth.  Simply put a round peg in a square hole. 

General management is a great role to undertake.  It has its ups and wow don’t we all know it has its downs too.  At times like these it can be the most isolated position in the organization.  However, the loyalty, trust and respect shown by the team are testament to the leader’s success and reward him or her with the greatest job fulfillment ITHOE.

For the Good Times

Thursday, February 18th, 2010

So we are now mid-way into the second month of 2010 which means we are into year four of this current downturn.  Yes, that’s right ~ year four!  It started with a decline in the residential market in 2007 and everything went downhill from there.  Foreclosures, out of control credit card debt, bankruptcies, unemployment, state deficits, a failed stimulus package and well known names on the high street going to the wall. 

Against this backdrop I still hear the statements around, “Yea, but it won’t affect me,” or, “It’s going to get better this year.”  I’ve even heard on a regular basis, “Well Texas isn’t as bad as the rest of the United States.”  Well so what?!?!  It’s time to get real guys.  It is like saying, “The U.S. has broken every bone in its body but we’re OK in Texas because we only have two broken legs.”  Let me tell you, two broken legs “ain’t” good.  It is called denial.

I started this off by pointing out that we are in year four of the downturn and these fallacies are the first of our major problems.  Too many people in all walks of life didn’t want to admit how bad things were and how bad they were going to get until we were in year two or even year three.  What that has done, has only served to prolong our current problems and exacerbate the country’s economic woes.

I say again guys, “Get real, this country is in trouble and we are all in trouble.”  Everyone wants to blame the government, the banks, the lenders and the companies.  There is the next problem.

Nobody is prepared to point the finger inwards and take some of the blame themselves as individuals.  For too long we have all been driven by greed, bettering ourselves by spending money we don’t have.  Credit card debt is out of control and needs bringing back into line.  As Warren Buffett said recently, The hangover is sort of proportional to the binge.”  Never were more true words spoken. 

What a hangover we are now suffering and what a binge it was.  An upturn that lasted more than 10 years.  Bigger houses, sometimes two houses, bigger cars, fantastic vacations, the list goes on, and all with money we didn’t have.  It was the biggest upturn and the longest upturn ITHOE and even though we all stuck our heads in the sand, the bubble was eventually going to burst.  The economy has always been cyclical, we know that, but the peaks and the troughs have always been manageable.  We the older folk have known pleasure, we’ve known hardship and we all learned how to deal with it, sometimes by falling down a time or two. 

The biggest often unrecognized problem that we have in front of us is that we have fueled a binge that lasted so long that we have bred a generation of younger people that has never known anything different to spend, spend, spend.  They’ve never know how to tighten their belts, they’ve never faced hardship or frugality and the even bigger worry is that they ascend into the management decision making rungs of our businesses.  

Running a business in this environment is tough, it’s about survival and it calls for hard, fast decision making.  It’s about right-sizing the business at every level whilst keeping the fabric and integrity of the business together ready for an upturn.

This type of decision making is one of the toughest calls for managers in this sort of economy and no MBA course or Harvard institution will help in this regard.  It is experience and exposure to the cycles that provide the ability to handle this crisis and we need to recognize that during this binge we have bred that experience out of a whole generation of managers and therefore they need careful coaching and mentoring to get them through it. 

Right sizing is always a difficult task. It is ongoing and has to be a priority continuously through the length of the downturn.  It’s wearing, it’s miserable, it’s hard work and it takes guts and strength of character.  But it has to be done.  It’s about survival and it fits the old adage that says, “We have to sacrifice the few for the good of the many.”  In other words, it’s about protecting the company and the majority of its employees even though it is tough, sad and difficult to see friends and coworkers lose their jobs.  It is however the harsh reality of the current situation.  It’s a situation that we all played a part in causing.  We all participated in the binge.  We all are suffering the hangover.  I appeal to everyone who reads this to regard their selves as part of the solution, act accordingly.

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