Financial Planning | Leadership / Management

Six steps to manage better in a downturn

"The greatest danger in times of turbulence is not the turbulence; it is to act with yesterday’s logic."

Peter Drucker

IStock_000005276589Large This post is courtesy of Harvard Business Publishing's Memo to CEO blog, titled "Your Blueprint for Managing in a Downturn," by Orit Gadiesh and Hugh MacArthur. They talk about creating your blueprint for managing through a downturn.

  1. Develop a roadmap for your three to five key initiatives, and focus.
  2. Start macro, and work down to what you will do differently on “Monday morning, 8 a.m.” — that is, the actionable to-do list.
  3. Be specific and pragmatic.
  4. Let the facts win the day.
  5. Create excitement and alignment.
  6. Budget two to six months (at least the first time).

The authors borrow from the lessons from private equity firms who often operate in turnaround mod. See their related post on "Lessons from Private Equity Any Company Can Use."

The authors define blueprint in this way:

"What is a blueprint? It is nothing more and nothing less than a strategic operating plan that takes the few key initiatives that promises the highest payback and turns them into results. The emphasis is on measurable actions. It starts with high-level moves and works its way down to things you can actually do differently on 'Monday morning, at 8 a.m. — in other words, to the detailed operational level — choreographing the moves from standing start to the finish line. Along the way, it helps create excitement and build alignment."

We have used a similar technique that borrows from Norton and Kaplan, called a strategy map. The point of all of these tools is to create the line-of-sight from every member of your team back to the organization's strategic plan. In today's world, you must be recalibrating your strategy and actions much more frequently than in the past due to the pace of change.

What tools do you use to manage in turbulent times?