Market forces have been very kind to the majority of us; kind that is until the recession began in 2007.
However, 2008 and 2009 were brand new years and the wave of profitability most of us had been riding began to shrink in size at varying levels for every industry.
We have had to rediscover the meaning of "Lean" and many have developed contingency plans or restructuring plans to maintain profitability and market share position.
The success we have enjoyed in the past will not be easy to duplicate in 2010 and 2011, even if economists are correct in predicting these as recovery years. In fact, we may not see that same level of success for many years to come.
The Unique Challenge The unique challenge that many of us have never faced before is a direct result of the easiness of past successes and past profitability. Successful profitability may have camouflaged internal problems and annoyances that could become a crisis in 2010 and 2011 if you havn't dealt with them during your restructuring or contingency planning process.
So, let's review some principles that can help us maintain our focus, recognize some of those sins that may have become covered up by profitability and create the kind of success in 2010 and 2011 that you can be proud of.
What's the Formula for Success in Tough Economic Times?
The answer to that question is a tough one to generalize on simply because we are all different. We run different businesses in different markets. We have different values, different back grounds and different ideas. We face different market dynamics. Things have changed for all of us regardless of the industry we serve.
Darwin Says:
"It's not the strongest of the species that survive; nor is it the smartest. It's not the strongest or the smartest; it's the ones that are the most responsive to change that survive." In order to survive the many ups and downs of today's changing environment and the market forces we will all face in 2010 and 2011 it will require sticking to the basic principles of running a well managed business; principles that may have become a little lax when the fish were jumping in the boat. These are general principles and action steps that we can all find value in order to meet the challenges we will face in 2010 and 2011. These actions and principles include:
Leadership Development There is a lot of talk about leadership development but very little specific leadership skill training is available. If you have ignored leadership development in the past your challenge will be much greater in the future. Let's face it prior to the onset of the current recession it didn't take a genius to make a profit in the majority of businesses out there. Today, however, making a profit and growing market share is going to be directly dependent upon the quality of leadership throughout your organization at all levels.
Success during tough economic times cannot become solely dependent upon surrounding yourself with the right people and hoping they have the skills necessary to do the job. Compassion often prevents us from replacing those that don't have the skills in a timely fashion and very little coaching and mentoring support is available within many companies.
This is a sad commentary considering that team building and teamwork skills are critical to the effectiveness of any management team. Success of your management team can be defined by what they accomplish as a group.
Synergy ---- A Prerequisite There must be a synergy within the management team that creates unity and clarity of direction with a common purpose that is in alignment with strategic initiatives. This synergy is essential for your management team to be successful. This is the first prerequisite for effective leadership. A common purpose and crystal clarity of goals and objectives are essential. Team building exercises must support the development of this clarity, which includes responsibilities and accountability.
"Purpose is the driving force of all accomplishments of greatness" -- Thomas Carlyle
What is your management team's real purpose? Do they all share the same response to that question?
Basic Best Practices As part of your planning process, take the time to review best practices as they apply to your business. Look at your processes, your procedures and your policies. Do they reflect good management principles or do they become a little spongy due to past practices?
Focus on Employees Development --- Upgrade - Upgrade
Don't cut training and development dollars. Continue to focus on people development. This will maintain employee respect, trust and will create a culture that will maximize employee efforts and willingness to do whatever it takes to create success. While Employee development is critical to success, so is making sure that you have the right employees performing the right functions.
The opposite of the "Easy Profit Market Forces" that cover-up employee incompetence is the "Tough Profit Market" that will highlight employee incompetence. "Tough Profit Market Forces" eliminate places for under performing employees to hide. Don't let too much compassion for long tenure employees cloud your judgment. Make sure expectations are clear, employees are trained and have the proper resources, but if they cannot perform you must act swiftly.
This economic environment provides an opportunity to upgrade your workforce by recruiting top candidates in your industry. Let me clarify; I am not suggesting you should go out and hire those employees that have been let go by your competition. Chances are if you do that you may be hiring the cream of the crud. After all, the competition is not going to let their superstars go.
However, that superstar that you have been eyeing for years that wouldn't give you the time of day may now be more than willing to talk to you after seeing the impact the economy has had at his company. He may even be more responsive if he has seen some of his friends let go.
Demand a Branch Level Discipline
If you have multiple branches insist upon a branch planning process that goes beyond turning in a budget. Make sure the plan is documented with timelines and accountability. Most importantly, make sure it is in alignment with strategic initiatives and supports your "End Game Vision for the Future".
Recognize Your Role as a Communicator? Effective communication is a prerequisite. This topic is discussed in every management book written because ineffective communication is generally at least partially responsible for the majority of failures within any management team. The key to effective communication starts with being able to listen effectively.
In addition to listening skills, an effective management team must foster trust within the group, respect for each other and their abilities, an open honesty to be able to express opinions without fear and a feeling of camaraderie that breeds an atmosphere of sharing both credit for success and responsibility for failure.
Strategic Planning If you don't have a strategic plan, make it a priority to create one in 2007. It is money well spent. If you do have one, go through an extensive review of all the initiatives. Do they still make sense? Has anything changed that will make a significant difference on your focus? Do you need to change your "End Game' or Vision for the Future? Has your role changed in the market place? Are your business segments still the best match for your core competencies? What has changed and more importantly, what changes do you need to initiate?
To not just survive in 2010 but to maintain an acceptable level of profitability is a goal that I am sure is shared by virtually 100 % of the individuals and companies that read this article. Keep these thoughts ever present in your mind.
Go back to basics in managing your business. Make sure you understand your role and your position in the market place. Define, create or refine your strategic plan or business plan according to today's reality. Understand and manage your cash to cash cycle. Insist upon sales territory plans that target accounts based on potential for growth.
And lastly, create change based on changes in your markets and your industry. Manage change – don't let change manage you.
Does your management team need an effectiveness assessment with a personalized management team workshop designed to help them deal with today's economic challenges? E-mail rick@ceostrategist.com if you would like to discuss a personalized assessment and workshop for your management team. Click on this link to review "A Management Guide to Coaching and Mentoring" www.ceostrategist.com 
