Don’t go it alone
Plain and simple, you can’t get your company through tough times on your own.
“Leadership isn’t just the CEO,” he says. “If it is, I don’t know how organizations can effectively do well.”
Since each business unit within NCI has its own president, those individuals were responsible for coming forth with a plan to reduce costs, as were those at the corporate level.
“What occurred was the presidents and their teams within our three business units are the ones who developed a plan based on the guidance we gave, which was a mild recession is a 15 percent hit and a deep recession is a 30 percent hit.”
You have to look at all aspects of your company to see where costs can be reduced.
“It’s across the board,” he says. “Those conversations were very open. We each came forward with our plans — What could get done, why, how fast, could we do more, what would be the consequence of doing more?
“It’s a conversation that is more than just a number or percentage. It’s about what’s behind those numbers. Where are we going to be with factories we have, with the people we have? How are we going to produce even half as much of the products that we produced in this year before?”
With your team, find forward indicators in your industry that can give you an idea of what is expected.
“One attempts to, in devising strategies for a company, try to get a range of possibilities and try to forecast downside cases as well as upside cases,” he says. “I would have argued that we did a pretty good job of doing that. But, I’ve got to tell you that, in retrospect, you can only say that we gravely missed the severity of the downturn.
“The fact that I’m in good company in terms of lots of people that did that doesn’t give me any comfort whatsoever. It gives me no comfort whatsoever the fact that many missed what has been probably the worst downturn since the Great Depression.”
You have to look at your volume reduction and talk to your team about how many people you need and how many locations you can keep open to keep producing.
“You have to work backward from some numeric goal in terms of some understanding of how much business you’re actually going to be able to produce to come up with what your cost structure needs to be,” he says.
While you may feel like many factors are out of your control, you have to control what you can, like costs, and keep everyone focused, while also depending on your team.
“I think that the notion of leadership is the ability to stay the course and continue to focus clearly on those things you can control and do your level best to make the right decisions with the colleagues that you surround yourself with as a leadership team,” he says. “It isn’t just one guy.”
Sure, people look to the leader to stay focused and to make good decisions, but they also want the leader to be open to suggestions and to value that input.
“Because it is, in fact, their commitment that is the only tool you have as a leader to weather a very challenging time,” he says. “It is the commitment of the people around you, of your colleagues and their ability to enroll people that work with them that is the difference, I think, between death and survival.”
