February 2008 What To Do About Leadership Development

Due to the current economic conditions, all development activities have been suspended.  In the meantime, you are to continue to look under every rock for every possible unnecessary cost which can be eliminated.  And of course, do everything you can to grow your business.

Does this sound familiar?  It is certainly the mantra being heard throughout many companies feeling the pinch of a tough business climate right now.   Senior people are under tremendous pressure to produce results this minute.  Reputations and jobs are on the line.  And that pressure is snowballing its way downward quickly, knocking out many items in its path, including leadership development. 

The obvious conclusion is that leadership development can do nothing for the short term.  As Dr. E. Ted Prince, founder and CEO of the Perth Leadership Institute commented:

“Recessions normally see a reduction in leadership development programs and spending since companies typically do not have confidence that these programs can provide short-term solutions to the financial issues that must be addressed.” 

Companies, that is senior managers, really need to think carefully about the assumption that leadership development programs cannot positively impact short term performance.  It may be easy and even understandable to eliminate them, but it is short-sighted and likely wrong.

When everyone is hunkered down, constantly pouring over the expense portion of the income statement, and even wondering if layoffs are right around the corner, it is virtually impossible for growth innovations, let alone breakthroughs, to occur.   This is an environment rampant with fear, uncertainty, shorter tempers, and endless directives from above.  Compare that situation to one which promotes and stimulates new ways of thinking, novel ideas, and innovative proposals that can be acted on in the moment – which is precisely what is needed.  This more growth oriented, creative-based environment results from the deliberate and intentional acts of leaders.  And like opening blinds or lighting a fireplace, the right environment can be created quicker than you think.

So the correct question is not whether leadership development should be cut in a tough environment, but rather what it should focus on.   Here are some specific opportunities that leader must continue to be schooled on, which can directly impact the short term financials.

They need to learn how to:

• be more inspiring about the future
• energize and unleash peoples’ creativity for growth
• think differently and strategically, in order to see new immediate opportunities
• develop thoughtful trials and pilots
• collaborate with people from other parts of the business to formulate new solutions
• encourage and coach their people to work at their best and to remain engaged
• be willing to challenge what is not working and move forward on new ideas, even when there is pushback
• help their people improve customer interactions and relationships
• be the role model of what is expected and needed.

There are, of course, a number of other development areas that could be added to the list, including those related more specifically to business or operational competence.  These are all lessons that can be immediately applied for immediate results.  And efforts to more fully develop your leaders in them must be continued.

There are a couple of last points to think about.  Organizations experiencing difficult market conditions have senior people who deeply care and feel enormous responsibility when business is off.  In fact, their war rooms are buzzing with very well intentioned and endless hard work.  Remember, they too have skin in the game and the work they do is necessary and important.   The trouble is they are often spending more time with their CFO’s, industry analyses and internal spreadsheets, and less time with their associates and their customers.  And a significant number of immediate growth solutions begin with these people, some of whom you have been investing in to lead you into the future.

Also remember that not all tough times need result in a major organizational or financial restructuring of the business.  Some organizations will succeed when everyone else in their industry struggles.  They will continue to find ways to distinctively meet customer needs.  They will create and offer new services that customers want, in spite of no validated market data.  And they will continue to find ways to execute in dramatically different and more cost effective ways.  They will do this because they have leaders in place all around their organizations who are inspiring people to search under every rock – and in every crevice of their minds and hearts - for new and better ways to win, retain and grow customers.  And that is the market-proven way of pulling out of any tailspin.