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Executive Interviews: Interview with Tamara J Erickson on Managing Troubled Times
March 2009
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By Dr. Nagendra V Chowdary
What is your advice to all such
people going through such traumatic
times? What are the few things that
they should keep a tab on and keep
working on so that life, if not as it
was, at least does not deteriorate?
What is the role of leadership in
managingmidlife change effectively?
Everyone – leaders and individual
contributors – must demonstrate their
ability to help the organization
through the difficult times ahead.
Here’s some core advice.
Question everything, deny nothing.
Pay attention to the first negative
result or indicator. Don’t assume it
was the aberration and everything
will bounce back next month. Maybe
it won’t.
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Especially since your
experience will tell you that sales will
go up, flip the manual override
switch and reconsider. Probably the
biggest mistake is waiting too long to
take action because you assumed
things would turn positive again. Favor greater agility over lowest cost.
Make decisions that favor flexibility,
even over cost. Even if it would be
less expensive to buy – assuming
demand were steady – rent instead.
Take advantage of SaaS capabilites for
IT, rather than investing in a big inhouse
effort. Use contract labor. Give
yourself as much flexibility as
possible in case demand drops. Watch your cash. Cash is a better
gauge in a recession than profits. Are
your customers slowing down their
payment cycle? And put your
managerial emphasis on managing
your cash well. Develop an alternative plan(s).
Answer this question today: what
would I do if sales dropped 10%, or
more? Don’t just worry about it –
develop a detailed plan. During one
of my darkest years (after the dot.com
bust, since I was working in a small
start-up), our CFO and I had an
alternative plan in hand that we
reviewed each week, identifying
what specific action we would take, if
performance dropped to various prespecified
levels. (I’m proud to say we
were one of the few firms in our space
to weather the storm.) And, spend sometime thinking about
what you’ll do when the economy
picks up again – because it certainly
will. Have your growth plans ready,
too. Accept thatwe are all in nerve-racking
times. At this criticalmoment, the key
is to actually do the things our minds
know need to be done, rather than fall
back on our instincts.When times are
tough and every instinct tells you to
retreat – to figuratively or literally stay
in bed – remember that these are the
times when your team needs to hear
from you the most.When your strong
preference would be to dampen
dissent, remember that considering
the contrary view can strengthen the
eventual choice immeasurably. Surely you would have heard of
India's Satyam Computers' colossal
collapse in December 2008. The story
is still unfolding with nearly 55,000 employees on its payroll, crestfallen
with this crisis coming amidst US
Financial Crisis. Satyam Learning
Centre (headed by Ed Cohen from
Booz, Allen & Hamilton) has been
busy last few weeks trying to calm
them down and rally all of them
around a critical mission to turn
things around. What would be your
advice to Ed Cohen and his team to
make a meaningful impact on the
employees' morale and commitment?
Employees are smart and perceptive.
If leaders begin with that basic point
of view, a wide variety of tactical
options will be helpful. The key is a
foundation of open information and
clear communication, without
platitudes. Beyond that, I’d advise Cohen to
provide as many programs designed
to provide employees with specific
information on how they can
contribute and the associated skills to
do so.
1.
Troubled Times Case Study
2. ICMR
Case Collection
3.
Case Study Volumes
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