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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
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outcomes that are no longer valid.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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