No matter what your situation is, one of the greatest dangers now is that you'll stop doing what you're already doing right.
66. ______.
The first fundamental is maintaining a clear-eyed view of reality, no matter how unpleasantly it may differ from what you expected. It's amazing how many executives are driven by management fads and slogans, big hairy audacious goals (BHAGs), quantum leaps, inspirational leadership-and then refuse to deviate from course even when the environment changes dramatically.
67. ______.
As the economy slows, you need to wipe your whiteboard clean and rethink your strategy based on what's realistically achievable.
We know of a major chemical company that in the recent era of super growth declared a goal of growing ten times bigger in ten years. It's a wonderful aspiration, but it shouldn't be the company's focus now.
68. ______.
The second fundamental-like the others, it must be non-is to focus on the quality of your people. We hope it's no longer necessary to argue that this is increasingly your company's only source of competitive advantage. Yet when times get tough, many companies ease up on recruiting, figuring a slow economy will drive more applicants their way, and they spend less on training as a way to raise profits quickly without doing immediate damage to the business.
That's just dumb, people do become obsolete; they also grow. To put "it in old economy terms, can you imagine postponing maintenance on an aircraft for six months? You wouldn't consider it, yet you may be tempted to do something even worse. Successful companies avoid this mistake.
69. ______.
The third fundamental is continual, day by day insistence on improving productivity. In a slowdown, productivity typically tanks, leading some people to conclude that it is an unavoidable fact of Fife. It isn't, and improving productivity during a downturn puts a company in a stronger competitive position when things turn up.
70. ______.
Maintaining a commitment to reality, a focus on people, and rising productivity-assuming you can keep those three plate spinning, you'll want to make several other moves quickly. (No one said this was easy. ) Speed is the key. Most companies will make most of these eventually, when they're forced to. Your challenge is to make them first.
A. Indeed, researchers have found that when the pressure is on, people exhibit a dismaying tendency to focus on insignificant problems while their perceptions become distorted and they insist on proving that their mistaken view of the situation is actually correct.
B. Colgate Palmolive has a remarkable record of improving productivity, as reflected in gross margin, virtually every year for the past 15 years, even during the last recession. In the brutally competitive slow growing business of household products, Colgate's stock has risen an average of 28% annually over the past five years.
C. This company, like most, should be asking how it's going to be No. l in a new environment. The winning strategies and tactics will not be the same as those for growing tenfold in ten years. All managers will have to be prepared for more frequent shifts in ten years. All managers will have to be prepared for more frequent shifts in priorities, not just at their own companies but also with customers and supply chain partners.
D. Based on our long experience-as a consultant working with some of America's most important companies and as a journalist investigating them-we're confident that as the economy slows, you'll be tempted to forget three of the most important fundamentals for keeping any business successful. This is the time when it's most crucial not to forget them.
E. We need to acknowledge when we haven't done things as well as we would like or when we do something wrong, but getting things wrong does not make us useless people. That does not mean we should not face up to our deficiencies, but facing up means moving forward, not allowing in the past.
F. The most valuable airline in the world, Southwest, is one of America's most desirable employers and in 1999 received 170,000 applications for just 6,000 positions. Yet the company recruits vigorously and never lets up, nor does it get stingy on training. The story is similar at Trilogy, General Electric, McKinley-getting the best people and malting them better is in the DNA of the most successful companies.