Getting too innovative in a desperate move to find new business in a downturn can have unintended consequences — most of them negative.
When a television show loses its plot line and goes in a totally different unbelievable direction, that show is said to have “jumped the shark.” It is a desperation move to do anything to get viewers back and keep advertising revenue dollars.
In challenging economic times, businesses are falling into the same trap. How can you prevent your business from jumping the shark?
Think Twice Before Abandoning Foundations of Your Culture.
I am all about change for the better and constant improvement. But I see executives making change for the sake of change, just trying to chase a dollar. Let's say your employees have enjoyed a flextime work environment. Now you feel the urge to lock in everyone's hours so you can control worker productivity more closely. Bad idea. You will lose the investment you made in employee goodwill. If you trust people to get their work done in the good times, trust them in the bad times. Avoid the kneejerk reaction of trying to grab control, strangling your employees' efforts.
A sales manager has been working with his team for years. Word from the corner office says everyone needs to watch budgets more closely, since revenue is down. Now the sales manager is making every sales rep account for every penny spent. Pens, lunches — heck, I even know of one manager who said he wasn't buying any more paperclips for the rest of the year!
Such attitudes and changes send a message of distrust and create a dictatorial atmosphere. Is that the environment in which your sales staff will thrive? Of course not. In tough times, you need to send a strong and clear message to your staff that you have faith in their ability to overcome the challenges of a changed marketplace, not resort to micro-managing and its implied message of, “You don't know what you are doing.” You may think you are making only temporary changes because of what are hopefully temporary changes in the economy. The problem: The damage you have done to employee confidence, morale and motivation is far from temporary. In fact, it may be irreversible.
Don't Lose Your Public Persona.
Under the weight of the pressure to perform, companies are abandoning their corporate personae. Employees and customers wonder what happened to the corporate culture they once enjoyed. This is why incentive trips are still necessary, despite what political minds say from inside the Washington, D.C., beltway. If top performers are used to an environment in which outstanding performance brings outstanding rewards and recognition, taking those away will gut their motivation to achieve. It's important to keep the focus and morale up among employees, especially those best performers.
The same applies to your compensation structure. One sales rep I know was recently told his company would not be paying any bonuses this year, regardless of individual performance. Many companies have made similar moves, and in companies where bonuses were modest, employees may be disappointed, but not devastated. However, this company had a history and corporate culture of paying very modest salaries, which were offset by generous bonuses based on production. It was not unusual for the bonus to make up two-thirds of a sales rep's annual pay, and sales reps had structured their family finances based on that. Can you imagine how devastated you would be when your pay was cut by two-thirds — no matter how good a job you were doing? Needless to say, resumes start flying. Can you really afford to lose your best people right now?
Don't forget the customers. The small courtesies and special treatments customers expect need to be maintained. If you are the hotel with the wine and cheese reception for guests, keep that going. If you are the restaurant that periodically announces free cookies for everyone in the dining room, keep those fun surprises happening. If your sales staff regularly treats high-buying customers to lunch, don't back off now. These are what keep your organization fun and unique. Don't lose that persona.
Resist the Urge to Take Your Business in a Totally Different Direction.
I am an innovator, and I believe every company needs to be in a mode of constant innovation. When I say don't go in a totally different direction, I mean as a kneejerk reaction to tough economic times. If you've always been the solid, reliable, quiet provider of services to your clients, now is not the time to go whacky and loud. It smells of desperation. If you suddenly expand your product mix to include everything you could possibly provide, you sound desperate.
When I worked for a textile company back in the ‘80s, top management decided they wanted to add a new revenue line and purchased a frozen food company. We knew nothing of that industry or distribution channels, and yes, the company lost millions before getting rid of the division eight years later.
I see this desperation in my industry as well. People don't want to hire a speaker who suddenly is an expert in topics he has never spoken on before, anymore than people want to walk into a furniture store and have someone trying to sell them shoes. Yet restaurants are trying to sell any food product they can think of, even if their branding promotes specializing in one type of food, and B2B providers are trying to be a one-stop shop, even if it strains their capabilities. Stick with what you know. Innovate to improve the current services you are delivering.
When TV shows jump the shark, they lose their core fans and never capture as many new fans as they want. Your business will get the same results. By the way, the term “jump the shark” was coined by Jon Hein about an episode of Happy Days. Fonzie (Henry Winkler), wearing swim trunks and his trademark leather jacket, jumped over a confined shark while water skiing, thus taking the '50s- based show in an entirely different direction to capitalize on the Evel Knievel craze of the time.
Stay with what you know, and energize your staff about what they know. In fact…
Have a Rally Call Day
Currently I am excited to be part of a great new project. This project even has a 30 city barnstorming tour to rally the troops and spread the word on new information and exciting changes on the way. People are actually paying to attend this rally as well! Why?
They believe and are excited about the future prospects and are eager to hear straight from the people at the top what the vision is for the near future.
When was the last time you had a rally call for your employees? Today, all I hear from executives is grumbling and mumblings about the economy, how work is a drag, and how they are waiting and hoping for the economy to turn around. Wow, I'm so inspired by such attitudes! NOT!
This Summer is the Perfect Time to have a Rally Call.
Why not plan an event for the end of July where you stop operations and call all your staff together for a day of inspiration, communication and invigoration. Have a motivational speaker kick off the day with a passionate energy-building keynote. Have the CEO follow with a program on the exciting future and how everyone has a role in making a difference.
Do a fantastic lunch — picnic style. Hamburgers, hot dogs, watermelon, cookies. Eat under an outdoor tent and have some music playing. Create a fun atmosphere.
Follow lunch with a Q-and-A session where employees write down questions on cards which are given to the CEO to answer on the spot. No previews or yanking a “bad” question; be transparent. Close the day with another motivational moment, either a speaker, movie, slide show, something to get them excited about what is going on in the organization.
Right now the focus on gloom and doom is choking off any hopes of powering into the new economy with any gusto. The worst thing upper management can do is see the turning around economy and relax, saying “finally,” and hoping the rising tide will lift all boats, including theirs.
This isn't inspiring! This isn't getting stoked! This isn't having a vision! This isn't even leadership. If you want to lead your company, that means in attitude and actions more than anything else. Create the Rally Day and inspire your people to get ready for a great opportunity to make a difference in your industry.
Bottom line, if you aren't willing to invest in your staff, close the doors now. You have already quit — you just haven't left yet.
Panic is warranted when your building is on fire, not when the economy gets challenging. Spend your innovation efforts on better ways to market, speed up your processes, and give your customers and employees an even better experience. Wouldn't you rather be the shark in the water than the one jumping it?