The power of perseverance Featured

3:09pm EDT February 18, 2011
Julian Hutton Julian Hutton

“That which does not kill us makes us stronger” opined the 19th century German philosopher Friedrich Nietzsche. The recent recession killed off many companies, and inevitably, the next one will kill more, an economic cycle as harsh and as inescapable as droughts on the Serengeti plains.

So, for both survivors and casualties, what did we learn that will make us stronger and more conditioned to survive the next one? We learned (if we needed to) that spending $1.22 million to redecorate your personal office doesn’t actually improve your company’s performance.

We discovered that however expensive your public relations firm, billing your company’s shareholders for your private jet in order to go panhandling to the taxpayer is never going to get you good press. We found out that many of our formerly friendly bankers, who we trusted to help our businesses, turned out to have been incapable of helping their own.

We learned who our friends were. Not just our suppliers and customers but, most importantly, those within the businesses we manage. We discovered who were the strong and who were the weak; we leaned on the rocks and flushed out the whiners, heard those who complained that they hadn’t had a pay raise or a bonus and listened to those who knuckled down and realized the only way to be paid more was to help the company generate more business.

But the most important lesson I learned was that however important a culture of good leadership at all levels is in the good times, it is absolutely critical in the bad.

Leadership is the single most important factor in any organization. It is the deciding factor between mediocrity and excellence, between success or failure. Those managers who had led their departments well before the recession, who had built strong teams, whose people exuded strong morale, whose staff were loyal to them and the company, who understood the aim and what was necessary to achieve it, who were prepared to make the tough decisions, were the ones that fared best when times got rough.

Those who had just gotten by in the happy years, their performance unnoticed or their attitude not addressed, were the ones overwhelmed by the difficult decisions and the changed circumstances.

Creating such a climate requires an ongoing commitment from the very top. The right people need to be hired, they need to be trained and they need to be allowed to flourish. They need to be mentored and their innate abilities developed. Being ultimately responsible for the company’s performance, it is my job to ensure that this happens. When things are going well, when it seems as if we can do nothing wrong, it is easy to compromise in the interest of priorities — “Let’s not worry about training; people can learn on the job.” Bringing in a weak manager whom you have doubts about simply to fill a role or failing to ensure that a manager has all of the tools he or she needs to do the job backfires when in a recession because that manager is incapable of inspiring his or her team to excel.

All of this needs to be put in place now, both to take advantage of the better times and in preparation for the next recession. The grass on the plains may be getting greener, the water holes filling up and the rivers flowing again, but the hyenas are still out there. Only by preparing can one stand the best chance of being strong and fit enough to survive when the drought returns, as it inevitably will.

Julian K. Hutton is president of Merlin Hospitality Management, where he oversees the company’s Hotel Management and Distressed Asset Management operations, drawing on 20 years experience in the worldwide travel and hospitality industry.