What (NOT) to do while managing a crisis - Lessons from our clients
By Chris Ellis - Senior Partner New Frame KK
Here at New Frame K.K., we are always looking for examples from business leaders that have gone through challenging experiences. While Coronavirus (COVID-19) has turned the business world upside down, this is not an unprecedented situation, and we can certainly learn from our past.
We have spoken to several clients over the past few weeks, and asked them what they would recommend managers NOT do in a time of uncertainty. Stories have come up from 2008/9 Lehman shock, the 2000 dot.com crash, and the earthquake and nuclear disaster here in Japan in 2011. The names have been changed to protect personal identities.
If you are a business owner, don't be the first to leave the building, run away or start panicking!
Of all the clients and managers we have spoken to, the most common topic was staying calm and level headed. Once client we spoke to (lets call him "James"), who was a director of an IT company, recalled when the earthquake first hit in Tokyo, back March 9, 2011. His boss, and the owner of the company, was the first person to run out of the building, and was screaming!. Not only did this frighten all the staff, but it left everyone with no idea what to do during this emergency. James said luckily, the Japanese staff who knew what to do organized people to quickly gather their items and leave the building in an orderly fashion. Outside they found the boss hyperventilating and pacing around. The lesson here is that your staff are looking up to you for guidance, and leadership, so if you can keep levelheaded and not panic, most likely your staff won't panic too.
Don't turn your phone off, don't go away camping, don't be unavailable!
Another common theme with our clients is having a manager or business owner who just drops everything and disappears. This was told to us by numerous clients, mostly small to medium-sized private companies, where, when the disaster hit, the boss or manager just disappeared or made up some excuse not to come to work, or just turned off their phone. While this may sound horrific to anyone working at a major global company, it happens more than you would realize during a crisis. For some people, making difficult decisions or acting as a leader does not come naturally, so they just shut down and shut out everything except family. This caused the staff to feel lost and let down, with many of them deciding that they need to leave the company as soon as possible. Avoiding difficult decisions, especially when you are a business owner or manager during a crisis never works. Communication is vital, and your staff needs guidance and leadership. If you can't provide that, then you need to delegate someone who can.
Honesty, don't dance around the truth of the situation, and don't lie!
Honesty. "Mark", our client who owns a successful consulting firm recalled his boss in the 2007 Lehman shock who lied about the business situation, even when it was obvious to all his staff that he was doing so. Mark's clients have stopped all consulting services, and there was simply no one wanting their business, the invoices were not coming in, and people were sitting on their hands waiting for the phone to ring. Mark's boss was constantly lying about going to client meetings, sales, and business development. Not only was this blatantly obvious to his staff, but he also refused to make contingency plans. Almost all the staff left over two months, and the company eventually closed in 2012. This was totally avoidable says Mark, who used this experience to open his own company and hire many of his former co-workers. The lesson here is your staff will know just as well as you do about the company’s health and business situation, in many cases, they will know better than you. Avoiding the truth and not being honest about the crisis helps no one and damages your reputation. Leaders need to make tough, honest decisions, avoiding them just leads to pain in the future.
While these are basic lessons from our clients, we think they are key to helping small companies manage through this global crisis. It is never easy to be a leader, but having staff depend on you for a livelihood and career brings responsibilities you need to live up to. What we can surmise is:
Don't Panic - Act like a Leader, even if it is difficult for you
Your employees are looking to you for leadership and advice; they need you to remain calm and act smart, even if that means you have to fake it for them.
Be constantly available - Don't shut down communication
Your staff needs you. They need a shoulder to cry on, and they need communication. Avoiding them will do nothing and only cause problems and a lack of trust.
Be honest, even when it is difficult
Above all, be honest. It is totally fine to say to your staff "I don't know" when answering a question. If you don't know the answer now, you might know in a week or a month, but if you lie or avoid the topic, it will be obvious to them and do nothing positive for you. Being honest and telling people you simply don't have an answer to their question builds trust, even if it does not solve a problem right now.
We hope you found these examples interesting.
New Frame K.K. is offering a free consultation to small businesses on how to manage small to medium-sized companies during a crisis. You can contact us on email@example.com for more information.
Chris can be contacted directly at firstname.lastname@example.org
New Frame K.K.