The prospect of tough economic times can be panic inducing, but this week on the Harvard Business Review Conversation Starter blog, Paul Michelman urges managers to fully think out the options rather than reflexively taking a defensive posture:
It's an American tradition: in the face of hard times, you cut the workforce, cut marketing, close down innovation, and do everything within your power to meet analysts' estimates. But at what long-term cost? The price of rebuilding the workforce and reigniting R&D is steep, and the timeline long. In many instances, we'd be better off sticking to our plans and seeing the hard times through. Instead of spending all that money, time, effort, and emotional capital on cutting people and programs that we'll later have to replace, I'd like to see leaders have the nerve to stick to what they believe is in the best interest for their organizations. They should focus their time and energy not only slashing budgets but on making the case to shareholders that a bit of short-term weakness is the surest road to long-term gain.Michelman's advice echoes the View's take in October when our own Sean Silverthorne suggested that business leaders take advantage of turmoil:
Going conservative in a downturn is just wasting a terrific competitive advantage, writes entrepreneur Bill Taylor. "If you start a company when everyone else thinks it's a great time to start a company, how is that an advantage?"So take a deep breath and steady your nerves so you can react with considered reason and resolve when faced with the possibility of economic trouble.