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Managing in Uncertain Times, Part V: Six Key Steps

Speed Up and Improve the Flow of Information

By developing and sharing timely and accurate information,
you become more able to respond quickly and effectively when
problems arise. Which of your services and/or products are truly
meeting customer needs, and which are not? Professor J. L.
Bower of Harvard Business School says, “You really have to
understand where you are making money and losing money,
literally by product (service) and customer.” What you don’t
know can and will hurt you.

Keep Your Best People Without Overpaying

According to Marion McGovern, CEO of M2, the key to retaining
professionals is enabling them to build and maintain
their intellectual capital by offering a diverse set of tasks, opportunities
and challenges. The key to retaining non-professionals
can be as simple as setting up family-friendly arrangements such
as flex-time. Anything that humanizes the workplace will likely
result in decreased turnover. Today’s workplace is different
from that of only 20 years ago, and it will continue to evolve.
Companies must recognize and adapt to this.

Control Fixed Costs

Refocus some of your energies and thoughts not on the grand
plan and vision but on the mundane and everyday. Lease
instead of buy; use temps or contract workers; outsource. Allow
me to give you Mault’s Maxim of Money Management: “Austerity
in Times of Prosperity” It is easy to spend when times are
good, and it should be easy to cut back when times are bad. The
best approach is to keep a focus on controlling costs at all times.

Train and Re-Train Your Employees

Peter Drucker stipulates that the companies with the best
trained work forces will ultimately prevail in uncertain times.
Focus on hands-on product and process training but, perhaps
more importantly, on human interaction and inter-personal
behavioral training. We tend to promote people into management
and supervisory positions without providing any training.
We tell them that management/supervision is just common
sense. The problem with that approach was captured by
Winston Churchill who said, “The problem with common
sense is that it’s not all that common.” Managers and supervisors
are not born, they are made by training.

Build Financial Awareness

One resource is the December 1998 issue of Harvard Management
Updates, “Painless Financial Literacy for Your Team
(and You).” Do your key employees know how their department
or unit contributes to the company’s performance? Do
they understand the marketplace and the competition? Can
they read a P&L? When people are more financially literate and
understand the big picture, they are more likely to do what’s

Write and Keep Contingency Plans

The environment might seem certain, but remember that Murphy
is an optimist. What are you doing to prepare for the unexpected?
You cannot plan for every eventuality, but you can set
some triggers. For example, if revenues decline for three quarters,
reduce staff if gross margins decline for four successive
months, renegotiate key vendor contracts, etc. Don’t let yourself
get caught by surprise.

About the Author

L. Douglas Mault is president of the Executive Advisory Institute,
Yakima, Wash.

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