You've worked hard for years to build your business and its culture.
The team works together, people are happy and excited about the company, you've done a good job managing growth and leading the business. But then the bottom drops out. Sales fall from record highs to levels not seen in years, and it happens suddenly.
Even worse, instead of bouncing right back, it has been months and sales are still very low. Decisions have to be made. How do you manage responsibly, keep costs in line and try to make at least some profit without ruining the culture you've worked so hard to cultivate?
Layoffs seem inevitable, and you dread having to consider breaking up the "family" and the effects that will likely have on those remaining. So what can you do?
Changing times can change the company
Economic slowdowns and the resulting cutbacks, layoffs, pay cuts or reductions, have the potential for dramatically changing a company and its culture. Employees may no longer have that feeling of confidence and security. They may wonder if they are next to go.
Good people may seek other opportunities. If that happens and the team erodes, so does your company's strength. The last thing you can afford to lose in rough times is your strength. Surviving the economic cycle and achieving a strong recovery depend on it.
The culture, therefore, must become a primary objective throughout the slowdown. Your employees are likely comfortable with the culture. It provides a sense of security and through hard times can improve their confidence, help ensure their support and commitment and discourage them from seeking other opportunities.
Focus on maintaining the culture
Maintaining the culture means following the same practices and principles in bad times as you do in good. As difficult as it might be, management cannot panic and let the culture deteriorate. If given the opportunity, key employees will work with you to help preserve both the culture and the business.
The team needs to understand that although your attention may be directed at maneuvering through rough economic times, you are intent on continuing to build and maintain the company culture. That means you must continue to do the little things that define your culture. Although budget constraints may force you to forgo some of the traditional but more expensive components of the culture, opting for less expensive alternatives can achieve the same results.
Odds are, if you ask your employees, the things they consider to be the most important components of the culture, most likely it is the intangible components that truly define the culture for them. Although you and your employees may not be as able to enjoy a catered company dinner or a weekend retreat, you can still have fun and maintain the culture with a potluck picnic or a company softball game.
Work with employees to creatively find ways to maintain the inexpensive intangible, yet very important, parts of the culture.
Keep in mind that the economic downturn will eventually end, so you need to be ready to jump as soon as opportunities arise. When the time is right, you should be able to move forward quickly and not worry about rebuilding your team.
Joel Strom (email@example.com) is director of Joel Strom Associates, LLC, the growth management practice of C&P Advisors LLC. The firm works exclusively with closely held businesses and their ownership, helping them set and achieve growth objectives while maximizing their profitability and value. Contact him at (216) 831-2663.