This post is off-topic from my usual software development-oriented posts, but given the state of the economy and that scaling back is the order of the day, I thought I would branch out and discuss tactics for managing/leading through tough times.
“I’m committing my tanks!”
This quote is from the World War II movie The Battle of the Bulge, about the siege of Bastogne. As American field commander General Grey makes this statement, I noticed that he did so in an animated, excited, and delighted manner. Why would a general, who is committing to a battle where people in his command will die, be delighted?
Before going on, let me acknowledge that this film was NOT critically acclaimed by movie war buffs. I do happen to enjoy war movies myself, and watched this for the first time in years because I picked up the movie on the cheap. I’ll confess that I did enjoy watching the movie more as a kid than I did as an adult, but I digress.
General Grey wasn’t delighted about committing his tanks because he was being a blood-thirsty jerk. It was because the time for analysis and speculation was done.
For the record, I do not have any military experience, but based on the military history that I have read, generals – like business leaders – do not always have complete information. They have to rely on the information that they have at hand, the opinions of their subordinates, and their own experience and judgment.
And most importantly, they need to make a timely call. To delay and wait for full information can cost them a battle. Indecision – and the time wasted as a result – can cost armies the value of surprise and position along with providing the enemy time to strengthen its reserves and better position itself while they are scouting you for weaknesses.
A lack of commitment looses battles. If you are going to attack, attack to win. This is why General Grey was delighted. He recognized that he had all the information that he was going to obtain within an acceptable time frame to engage the enemy. Furthermore, he was done deciding what action needed to be taken. He had committed himself and his army in a decisive direction – now he could focus on making that direction a success.
From a military perspective, battle is chaotic, typically lacking the clarity that would make most of us feel both comfortable and assured. The business world is no different. You need look over the landscape, collect what information that you can, and then provide the troops with focus and commitment. And I’m not the only one who thinks this way.
In his book: Andy Grove The Life and Times of an American Business Icon, Richard Tedlow quotes Andy Grove about the tendency for people to hedge their bets when faced with uncertainty. Andy Grove doesn’t pull any punches: “Hedging is expensive and dilutes commitment.” Grove states that you need “exquisite focus.” The observation being that without commitment, “you will always be looking for a way out rather than a way to win.”
What is your business doing in this uncertain economy?
Now is the time to be investing and positioning for the future. Downturns in the economy cause people to react cautiously, cutting expenses and reducing investments to improve today’s bottom line. This can cause long-term loss of market share and strategic position, creating an obstacle that is more difficult to overcome later. Here’s a quick, 5-point list on ways to take advantage of a down economy to strengthen your business.
Keep the R&D Dollars Flowing
Don’t sacrifice tomorrow for today! Assess the return on investment on everything that you are doing, and keep your business focused and committed on those activities that drive your economic engine and competitive edge. Cutting “investments” to save a few dollars today is really nothing more than hedging your bets – and slitting your own throat.
Don’t Skimp on Sales and Marketing
Because companies are looking to save on every expense possible, you can grab business from your competition by offering a lower price. Doors that have been previously shut because companies “already had a solution from another vendor” may open if you can provide goods or services at a lower cost. Keep your sales force active and knock on those doors!
Likewise, advertising budgets get slashed by many companies in bad economic times. You can use your competition’s cuts to your advantage – by keeping your business visible while they are not.
Now is the Time to Hire
Layoffs have created a large pool of great candidates. This is something that will not continue indefinitely for more than one reason. First, the economy WILL turn around, and jobs will be created. Secondly, and in the United States in particular, the baby boom generation is getting older and looking towards retirement. There are simply less good people that will be a part of the labor pool in the years to come.
According to research by McKinsey, "finding talented people (is) likely to be the single most important managerial preoccupation for the rest of the decade.” The problem is that "too many firms still dismiss talent management as a short-term, tactical problem rather than an integral part of a long-term business strategy."
Provide Great Customer Service
Give customers a reason to stay with you – and recommend you to their friends and acquaintances. Treat your customers like gold, and provide them with exceptional service. This will pay dividends in today’s connected world; consider all of the Facebook and Twitter word-of-mouth that can spread in the form of guerrilla marketing if customers have a great experience with you – including recommending you if their friends have negative experiences elsewhere.
Look for Acquisitions
Now is a great time to shop for acquisitions that can strengthen your business. Acquisitions always present risk, but there are great opportunities at bargain prices today relative to a few years ago, and this represents opportunity. The right acquisition could substantially improve your competitive dynamic.
Some related links if you are interested in more:
Starting Up in a Down Economy
Taking Advantage of a Down Economy With Investment Hiring
5 Strategies For Business Prosperity in a Down Economy
M&A: A Smart Strategy in a Down Economy