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Great Results in a Bad Economy

It is the manager's job to "get more done with less" get greater results using fewer resources. Fair enough, but this expectation has been stretched beyond limits in what is now termed the "Great Recession." And managers can easily be overcome trying to merely tread water rather than focusing on exceptional results.

In a recent survey of the Harvard Business Review Advisory Council, respondents were asked "What are the obstacles to executing strategy?" The investigators posed two scenarios: in normal times and "in the current economy." The most important and prevalent obstacle cited for the current economy was "Too busy/lack of time/resource constraints." In this environment, managers can certainly be forgiven for just trying to keep the business afloat...can't they?

Most of the time, managers recognize a lack of resources as the limiting factor it is, and rather than lamenting this, they focus on things like aligning work activities with strategy (the most prevalent response for the "in normal times" scenario).

In a bad economy, however, managers can mistakenly make resource constraints both time and money a primary point of emphasis. Effective managers plan around limiting factors, and focus on getting great results. Fortunately, there are ways to mitigate the negative impact of a bad economy.

First, stop or change unnecessary activities. Companies often cut back by downsizing, but don't necessarily downsize the work activities. Taking inventory of what is being done is a first step, but also ask WHY it is being done it may be for outcomes that are no longer valid. If the outcomes are still valid and the activity is deemed necessary, people can then look at HOW it is being done. Often, legacy systems are kept in place even as they become irrelevant or badly inefficient.

Second, the tendency for many managers in a tough economy is to contribute more to specialist work or to act as an added pair of hands in fighting various fires that emerge each day. Yet, a better way to overcome resource constraints is to devote more time to planning and implementing a measurement system that allows people to focus on the right things and take responsibility for achieving outcomes assigned. The idea is to build capacity in your direct reports this is the best leverage to get more done with less. Effective monitoring systems must go along with the right measures. Ideally, workers will have access to feedback on their results, which will allow them to adjust and learn.

Third, foster innovation by pushing authority down. Setting big and clear expectations allows your staff to take responsibility for innovating. This innovation might be to create new revenue. For example, a marketing department for a newspaper business a tough industry over the past decade was allowed to find new revenue opportunities through promotions that concurrently developed the brand and led to increased circulation. What was once a cost center began delivering new revenue.

Innovation can also occur to reduce costs. If authority is delegated to the right place, where the work gets done, people can modify performance to become more efficient and economical. In that same newspaper marketing department, head count actually decreased even with the new revenue-generating activities. Because clear policies were used, many unnecessary tasks disappeared.

Finally, managers must create the right focus for the work environment. If the sentiments of employees are focused on the economy or the lack of resources associated with the economy, then their activities will be misdirected and dysfunctional. The leader can choose to focus on work and results rather than the economy. Remember: "People will place importance on what you pay attention to." If the person in charge pays too much attention to the economy, it will misdirect people.

It is important to observe how people are relating to the work. Are they caught up in limiting factors? Are they complaining about things outside their control? Managers who over-empathize may be popular for a while, but sooner or later the lack of focus on what must be done will cause people to fail. The leader must monitor sentiments so they are appropriate for doing the work successfully, regardless of the conditions outside our control.

A bad economy seems a reasonable explanation for lackluster results, but it is not the right choice for effective managers. A better option is to focus on what can be controlled explicitly focusing people on performance, continually providing them with clear feedback on results, and devoting time to planning for new opportunities. That is the best way to stay ahead of a bad economy.


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