What are the responsibilities of business leaders in times of crisis? And how can they apply the lessons learned in tough circumstances to everyday business. Joshua Hammond finds out.
It’s never plain sailing. Every business goes through a crisis of one kind or another, whether it be financial, technological or as we’re all experiencing now, something completely out of our hands. In choppy waters, it’s necessary to have a level head at the helm.
At times like these each managing director or chief executive will have their own views and tactics about how best to undertake the challenges and lead a business into better circumstances, but some lessons are universal and opportunities can be made.
David Spicer from the University of Bradford’s School of Management, tells Insider: “The role of a leader within a business should not change much during times of crisis, because our expectations of them should remain the same. We should be looking for energy, enthusiasm and a sense of vision and direction at the core of the business.
“But what happens in crisis, is two things: the role of a leader becomes more difficult as they deal with the crisis at the highest level but also expectations shift in the workforce. I undertook some research with a colleague in Japan at the time of the last financial crisis and found that people’s expectations become more focused on how leaders can support and maintain their circumstances.”
Spicer’s research found that workforces wanted to almost feel ‘looked after’ by those in leadership, rather than just providing a vision of what the business should be. Respondents were less enamoured with a ‘bright future’ when times are tough and want to understand the realities of the situation and know how the business is going to come through it.
He adds: “Times of crisis reinforce the need for effective communication. In that situation, you need to be able to cut through the noise of the crisis and be sure that the key messages are getting to people and giving as much predictability as you can so that people can digest the challenge they’re facing.
“Out of that you should be able to get some small wins as well. Looking at the current crisis you can see that individuals are innovating and being even more productive from home. Recognising and celebrating that with people is key.”
Of those wins, Spicer also suggests a period of difficulty can even improve a business’s relationships with its board members and customers. Taking the initiative to be totally up front with how business is being affected and the strategies for countering the situation can yield positive reactions. Customers are more forgiving of an organisation that owns up to a problem before it becomes a major crisis for them.
A particular feature of the Covid-19 crisis is that many members of a workforce are now working from home, and traditional communication channels are no longer open.
There needs to be space in the day for informal communication as well as more regulated and timetabled discussions. Over the lockdown, people have lost the same level of day-to-day contact they might have enjoyed previously and the little moments of conversation that could spark an idea get lost.
This is something that Suzanne Robinson, managing partner of EY in Yorkshire has taken seriously during the current crisis, especially while people are working from their own home offices and missing the camaraderie of work.
She says: “A key thing for business leaders to make sure they have is trust, whether that’s the trust of your team, wider workforce or of your clients. It’s important that you have that during times of crisis, but if you don’t have that instilled already, I don’t think that you can just switch it on because you’re in a period of difficulty.
“The way you communicate, in terms of the frequency, your openness and honesty and the way that you listen, is more important at times like this. I’ve certainly done more of that over these tricky few months.”
While many in lockdown aren’t being met with financial turbulence, some businesses will have been hit particularly badly by the changing economic circumstances.
When asked about how to deal with bad news, Robinson says: “For me the answer is always about being completely honest with people. Giving clarity with your strategy can help people to understand and know what to expect. Being able to flex and be agile and set out what your objectives are means that it’s easier to adjust to the circumstances and prioritise giving people security about their jobs.
A key thing for business leaders to make sure they have is trust. I don’t think you can just switch it on.
“I always want to engage with our people effectively. This has made me realise that some people like to communicate in different ways, not just in the fashions that I prefer or have become used to.”
Jim Ker, is vice-chair for communications on the Chartered Institute of Marketing (CIM) Yorkshire board. He suggests that while businesses are taking the opportunity to modernise and become more resilient to future shocks, relationships with stakeholders are crucial for the short and long-term stability. Keeping them onside is pivotal in the future of any organisation.
He tells Insider: “Marketers are at the forefront of understanding stakeholder influences. Utilise this resource and look at how a marketing-orientated strategy will help you create an adaptive business model that entices customers, but also supports a desirable working environment that encourages creative thinking.
“Future proofing your company’s ability to adapt and innovate is an investment, but a worthwhile one, especially during these times of crisis.”
Kevin Parkin, chairman of Parkin Ltd, described himself as ‘the man for communication’ before his interview with Insider. His business is a professional management and business turnaround company helping those in the manufacturing sector reverse their fortunes through better management.
A believer in being upfront and stopping whispers on the grapevine, Parkin has seen the damage that can be caused when messaging is neither clear nor effective.
He says: “You need to communicate consistently and constantly but also allowing for feedback to create a two-way dialogue. People need to be absolutely certain of the consequences and you need to be sensitive that notices are clear and easy to understand.
“Rumours can get out of hand, so whether it’s good or bad, you need to stop people from speculating about the future of the business. There’s no point in telling people just bad news either because there is a risk that you will lose your best people by not giving them any hope or reason to stay.”
Businesses might also need to recruit new people to help see them through difficult times, an even greater hurdle when word might be out that an organisation is struggling.
Parkin adds: “In turnaround situations, I make sure that the board makes their diaries public so that people know that everyone from the leadership down is working hard and nobody is going golfing or staying at expensive hotels when trying to drum up business. Some boards will resist that, but if people’s livelihoods are at risk then you shouldn’t be staying in four star hotels.
“You need good people to help you through these situations. You should let your staff know when you’re trying to drum up publicity, or make them aware of any news so that they’re not taken by surprise. What you want is for every employee to go to the pub on a Friday and feel able to say that they work for a great company and be confident in that.”
