We
are in the midst of the worst economic crisis of our lifetime and no one can
accurately predict how long this crisis will last and what the long-term
ramifications will be.
We
are in the midst of the worst economic crisis of our lifetime and no one can
accurately predict how long this crisis will last and what the long-term
ramifications will be. The only certainty is that the business practices that
we have relied on for decades will require change. That means that business
management philosophies must be altered to meet the forthcoming
challenges.
The current business environment will require managers at every level to
provide the leadership necessary to navigate the organization through the
impending economic uncertainty. A competent manger must always possess certain
key traits to be an effective leader, such as accountability, confidence and
integrity. In these challenging times, a manager must be organized and maintain
the skills necessary to supervise and direct employees in an effort to advance
the implemented goals and strategies of the organization. Managers must also
communicate effectively and engage in conflicts
productively.
In uncertain times the manager must provide the leadership required to
facilitate the required organizational change. There are six leadership traits
that are essential to managing through change in uncertain times:
1. Ethics
2. Communication
3. Involvement
4. Spirit
5. Flexibility
6. Vision of the future
Ethics
Business ethics is by definition “the moral standards by which a company
conducts itself.” The company’s leaders and managers have a personal obligation
to conduct themselves and the organization’s business practices in an ethical
manner. Stories about unethical business practices have lined the front page of
the nation’s newspapers in the last decade, including than those of Enron and
Arthur Anderson. Their demise can be directly attributed to unethical practices
of top management. In some respects, the current global economic crisis has
been propagated by unethical business schemes.
Business ethics is divided into three equally important categories: (1)
non-discretionary, (2) organization-specific, and (3) discretionary.
Non-discretionary ethics include universal items that allow for zero tolerance
if they are violated. These include laws and regulations, public and employee
safety, and truthfulness in financial statements.
Organization-specific ethics involves policies and procedures that the
organization adopts as the ethical standards that cannot be compromised. The
organization’s ethical standards should be clearly defined in the employee
manual and referenced in its mission statement. It is the responsibility of all
personnel to be familiar with these standards. It is management’s
responsibility to ensure that these standards are upheld throughout the
organization. Furthermore, management should enforce a no-tolerance policy for
unethical behavior.
Discretionary ethics typically involve issues that are not necessarily illegal
or against the organization’s standards; however, they may still be perceived
as unethical actions. The manager must set the organizational standard by
acting in a fair and honest manner in all business dealings. Telling a “white
lie” to close a sale is an example of discretionary ethics. Typically these are
issues that have to be conducted at a personal level. Asking such questions as,
“Will you be comfortable and guilt free from your behavior in this matter?” or,
“Does it match stated guarantees or commitments?” could go a long way in
determining the proper ethical response. The best way to handle these issues is
by looking at them with respect to the three R’s of respect, responsibility and
results.
Respect is required at all levels of the organization - internally and externally.
Obviously, respect is required on a personal level and should be granted to all
co-workers, customers and vendors by treating them with dignity and courtesy.
Respect for the organization and the work environment is equally as important.
All members of the organization can protect the work environment by following
the established rules and regulations regarding use of equipment and materials
and by using organizational time effectively. Using equipment for
non-organizational activities or taking office supplies - because “everybody does it” - is disrespectful and
unethical. It is also unethical for an employee to spend large amounts of time
on non-organizational activities during work time such as updating Facebook or
managing fantasy sports teams. These are activities that should be completed in
moderation during work breaks or at lunchtime.
It is the responsibility of all members of the organization to provide timely
and high quality goods and services to customers. The community’s perception of
the organization should be that they would uphold and follow through with all
commitments in a legal manner. In simple terms, business dealings should be
completed by looking a person in the eye, shaking hands and having trust that
the agreement will be completed to the best of the organization’s abilities.
Each member of the organization has the personal responsibility of working
collaboratively with others and ensuring that their work performance adds value
to the organization and meets the expectations of
management.
Results are the measurements in which the organization is evaluated. Ethical
results are only achieved when an organization derives them in legal and moral
manners. Most unethical behavior in business occurs by falsifying results -
typically by providing false financial statements. This was certainly the case
in two of the biggest business collapses of the last decade - Enron and Arthur
Andersen. To some extent, the falsification of results by lending institutions
helped initiate the current economic crisis that we are entangled in.
It is the responsibility of management to define the organization’s ethical
standards and to ensure that all unethical practices will not be tolerated. It
is the responsibility of the employee to follow the ethical standards and
maintain personal responsibility for their actions. To help ensure ethical
behavior, follow these guidelines, which are important in all phases of our
lives:
• Don’t take what is not
yours.
• Don’t accept what you have not
earned.
• Maintain
confidentiality.
• Be honest.
• Don’t bend the rules to get
results.
Communication
Communication is key to success in any form of organization. Therefore an
effective leader must be a good communicator. It is even more critical in
uncertain times that management keeps an open line of communication with the
employees, customers and vendors. Constant communication is vital in providing
all essential information regarding the organization. The message must be
articulated in a manner that is clear and understandable to
everyone.
The message must be consistent at all levels of the organization and studies
indicate that repetition is often required for understanding. The most
effective leaders will be open and honest in all communications. In these
uncertain times it is difficult to access the direction of the business
environment. Effective leaders will present their vision of the future with
honesty and humility and simply level with people by acknowledging there are
limitations in understanding future trends and that the currently implemented
strategies may change. Honesty and transparency will earn creditability from
all levels of the organization: both internally and externally. This will go a
long way toward gaining the employees’ trust, which is a critical component of
a strong leader. Employees require someone they can rely
on.
The manager must also understand that an effective communicator is also an
excellent listener. It is important that communication flows at every level of
the organization. Some of the best intelligence that you gather will be from
frontline employees who interact with customers and suppliers. Their feedback
can be valuable in determining the existing business climate and in developing
future strategy. It is also important that you listen to any ideas they may
have for improving operations. Asking for employees’ opinions and implementing
their ideas when they make business sense can not only lead to cost-saving
procedures but can also elevate the employees’ commitment to the
organization.
The flow of information can be provided in various forms. The most effective
method is through staff meetings. In uncertain times, when change is fluid, it
is imperative that the meetings be held more frequently. Depending on the size
of the organization and the speed of change in the business climate, it may be
required to meet on a weekly basis.
Communication is also essential in exchanging information on methods,
initiatives and processes that will benefit the organization. This can be
accomplished through internal forums that state the organization’s goals and
benefits. It is important to provide internal and external stakeholders with timely
updates regarding the organization’s progress in reaching these goals.
Communication can be provided through the regular maintenance of Internet and
intranet sites that also provide the organization’s policies, procedures,
points of contact and other resource information for employees, customers and
vendors. The best workforce is an informed workforce.
Involvement
Due to the rapid changes occurring in the business world, it is no longer
permissible for top management to sit in their ivory towers and manage through
delegation. The managers must make themselves available to every level of the
organization to obtain all relevant information concerning performance. An
effective manger must jump right into the game. This is not the time to sit on
the sidelines and watch. Nothing can be accomplished by managing from the
outside.
A prime function of involvement is to ensure a continuous focus of the
organization’s operations. This can be accomplished through a series of meetings
with senior management and specially assigned task groups. Senior management
personnel should conduct quarterly meetings to review strategies and ensure
that the organization is taking full advantage of its capabilities in meeting
these strategies. The implementation and review of new products and/or
processes should also be discussed in these meetings.
Management should also assign a task group within the organization with the
responsibility of defining best practices. Management should meet with the task
group on a regular basis through a series of briefings or updates to determine
the progress of implementation of these practices.
Top management should also make themselves more accessible to the employees;
this can be accomplished by frequently walking the plant floor or by eating
lunch in the employee cafeteria. Accessible managers give employees a sense of
comfort regarding the direction of the organization.
Spirit
The manager will be charged with firing up the employees in uncertain times.
This is of particular importance in organizations that have had a significant
reduction in the workforce. Employees that have remained may feel threatened by
the potential loss of their job or may be overworked from taking on extra
duties due to staff cutbacks. A recent poll of American workers found that
nearly 40 percent of employees are worried that they are going to lose their
job within the next twelve months.
This troubling statistic illustrates the need for organizational leaders to
boost morale because a motivated workforce is a more productive workforce.
Motivation is required at the most basic of human values: People need to feel
needed and wanted, and they need to realize that they can and do make a difference.
An effective leader can promote spirit in an organization the same way in which
a coach inspires an athletic team.
The first step in this process is to make certain that the organization still
has the fundamental core vision that may have attracted many of the employees.
Troubled economic times have forced many organizations to diversify their
products and markets to stay solvent. If these changes have altered the
organization’s original core vision, some employees may feel alienated and
become dissatisfied with their new role. Now is the time to evaluate the core
vision of the organization and clearly define the mission moving
forward.
Spirit is injected into an organization through team building. Management
should promote collaboration among the employees give everybody an equal
opportunity to participate. The employees need to feel valued, and setting
goals and tracking the progress towards the goals can achieve this. Everybody
has an internal desire to win, so if you set achievable goals employee morale
will increase as the goals are met.
One area where a manager can boost team spirit is at the staff meetings. It is
the responsibility of the manager to ensure that these meetings are used as a
time to enforce a positive message about the organization. The focus should be
on exchanging information and discussing viewpoints and ideas that will aid the
organization’s future growth. The overall spirit of the organization will be
positive if the purpose of the meetings is to pull people together to solve
problems rather than focusing how bad the problems are.
Flexibility
The only thing certain in today’s business climate is change. The manager must
be able to navigate the organization’s strategy through an uncertain climate.
To effectively manage change, the manager should not rely on an adherence to
pre-figured routines. An important attribute of a manager is flexibility.
Managers must have the ability to drop whatever they are doing to tend to the
most pressing issues as they come up.
Flexibility is also required in planning. The organization should follow the
action-feedback model by planning and acting on information in short intervals.
During times of rapid change it is best to treat everything as a temporary
measure.
Vision
A key role in leadership is setting the direction of the organization and then
influencing people to follow. Even in these tough economic times an effective
leader should have an eye towards the future in charting a path for the
organization’s growth. All organizations require growth at some level to
succeed. Growth does not necessarily have to be in the number of employees or
physical sites; it can be measured in such important business variables as
effectiveness, quality or production.
An important attribute of a good leader is to provide vision for the future.
Vision is achieved by long-range planning and is most effective when the
organization has a true vision statement. The most successful leaders write
down their goals, values and visions for the organization and use them as a
barometer for performance.
A vision statement - or a mission statement, as it is sometimes referred to -
defines the organization’s long-range planning and identifies the steps
required to achieve success. To establish a successful vision statement the
organization’s core values must be defined. Unless the long-range planning is
intended to steer the organization away from its core business - never
recommended - the vision should focus on improving sectors within the
organization’s core values.
A vision statement can be prepared by answering a few questions about the
current state of the organization:
• What are the core values of the organization?
• What is the organization best at?
• What changes are required to compete in the future?
Once the vision statement is prepared it should be shared with all stakeholders
in the organization and management should define their roles in meeting this
vision. The vision statement should be referenced at all strategic planning
meetings to determine if the set goals are being
accomplished.
Successful leadership involves making decisions that affect an organization and
then acting upon those decisions to accomplish the desired results.
Drawing Board: Principles of Management for Uncertain Times
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