{{Article.Title}}

{{Article.SubTitle}}

By {{Article.AuthorName}} | {{Article.PublicationDate.slice(6, -2) | date:'EEEE, MMMM d, y'}}
{{TotalFavorites}} Favorite{{TotalFavorites>1? 's' : ''}}
{{Article.Caption}}

A pandemic, civil unrest and contradictory mandates from government disrupted business as never seen before in 2020.

Leaders ask themselves how they will ever survive, let alone attract and support talent. The answer isn’t all that hard. The United States will get through COVID-19 the same way job providers powered through the Great Depression (1929), SARS (2003), 9/11 (2001), Hurricane Katrina (2005) and the Great Recession (2008).

Outside forces overwhelmed and wiped out many companies in each case, especially those that were highly leveraged on debt. The solution to recession-, pandemic- and natural disaster-proof organizations is to build places where people love to spend a significant part of their day solving problems.

Create a framework for holding every individual up and down the leadership chain accountable. Open the financials to employees. Provide bonus and ownership incentives. Most importantly, lighten up.



Here’s how.

First, every successful enterprise runs on a solid operating system, whether it’s “The Great Game of Business,” “Entrepreneurial Operating System” or emulating another stellar outfit with enviable best practices.

Regardless of the system, businesses only grow with an airtight method of accountability so everyone knows their role in the broader operation. You can’t manage what you can’t measure, as management guru Peter Drucker reminds us.

Find the Critical Number for the firm. It is the one measurement that represents a vulnerability that, if not addressed, will imperil performance and sustainability.

Say a $1 million firm relies too much on one customer for income and recognizes the susceptibilities involved. It diversifies away from one line of work into two equal lines of work. The critical number in this case would be $1 million, or 100% growth, on the second line of work. It’s a measurable target to which everyone can aspire, especially when broken down into several steps.

Second, open the books to employee scrutiny. A lack of information leads to incorrect assumptions. Often folks think that if someone owns a company, they’re already wealthy, when in truth they’re operating on 5% to 7% pre-tax margins with a line of credit. When the team really knows where they are financially, they can better focus on reaching their collective goals.

Give everybody a voice in saying how the company should run to give them a stake in the outcome, whether it’s success or failure. Success happens when management shares information with the workforce as opposed to assuming they can’t be trusted with such delicate information.

Third, create a performance bonus system that applies equally to everyone. Whether or not an Employee Stock Ownership Plan is in the cards, performance bonuses enable everyone to rally around the Critical Number and take home some of the winnings. People will move mountains when they see how much they stand to share in profits.

When done right, the bonus system provides an opportunity to get the entire enterprise honed in on the biggest liability it faces for the month, quarter or year. It provides everyone with a powerful incentive to fix problems.

Finally, lighten up and don’t stress so much. Imagine the worst that can happen. It’s actually not the end of the world, and most come out of it stronger than they were.

Many organizational leaders find it liberating when they figure out how to overcome economic disasters such as recessions and COVID-19. Of course it feels like failure when things aren’t going well, but surviving challenges today shapes how they respond to even tougher challenges in the future.

Developing talent is about servanthood. How does management help its teammates reach their potential? Once they figure that out, they in turn help others on the team to reach their potential. It’s a snowball effect that leads to a virtuous organization that will stick around for a long time.

Leaders can truly create a company where people love to work. They can care about employees, listen to their opinions and respect them. Everyone needs to earn a living somewhere for a decent portion of their lives, and they shouldn’t dread getting out of bed in the morning to do it.

Focus on informing and developing talent, especially during economic disasters such as COVID-19, and the world-class business almost builds itself.

Print

 Comments ({{Comments.length}})

  • {{comment.Name}}

    {{comment.Text}}

    {{comment.DateCreated.slice(6, -2) | date: 'MMM d, y h:mm:ss a'}}

Leave a comment

Required!
Required! Not valid email!
Required!