Leading in Uncertain Times

As we move into 2023, big economic questions loom for companies across industries and around the world. The challenges ahead are no secret, and have their roots in global developments that we’ve seen over the last several months: inflation and resulting policy efforts to slow growth, translating into rising interest rates and the higher cost of borrowing. At the same time, COVID has altered the trajectory of business in China, interrupting supply chains for many companies. And in the technology sector, mass layoffs are making major headlines.

The bottom line is that anyone reading the news, including your employees, understands that there is a real threat of recession. Fear and uncertainty alone are enough to make the task of managing an organization that much more difficult.

I’ll let the economic experts dissect all the causes of the current situation. What I’m focused on is this: leading with purpose, respect, and awareness through the good times, but also - and perhaps especially - through the bad.

In fact, for business leaders, whether you’re a small business owner or the director of a large corporation, I would suggest that managing during difficult economic times is not just a test of your abilities, it’s an opportunity to connect more deeply with your mission – and with your employees. It is, ultimately, a chance to become a better leader.

Here are three key factors that I believe define powerful leadership in the face of economic uncertainty and slowing global markets:

Connecting with Purpose

When stress is high and sales slow, many leaders retreat when they should be redoubling their efforts at connecting with their teams. As a recent Harvard Business Review article suggests, engaging is important, but shouldn’t be confused with micromanaging. The mission is to help and motivate teams without suppressing creative solutions and without discouraging your people from taking the initiative.

Setting Realistic and Transparent Goals

In a downturn, companies will tighten budgets, while asking employees to work harder. It’s the classic: do more with less. Good leadership means boosting productivity, but as mentioned, it should be accomplished by motivating teams to achieve, and it must be respect-focused. At DHL , we promote respect-focused leadership and management, with an eye on inspiring our teams. We ask our managers to take a personal interest and show genuine respect and concern for others, while being open and approachable so that team members feel free to share their views, experiences and ideas. Our goal is to inspire people to do their best and thrive. When times are tough, it’s a chance for leaders to really focus on this goal, to remain extremely positive, and to understand just how vital team building is to organizational success.

At DHL, we supplement our respect-focused work with results-focused strategies. We ask leaders to clearly communicate expectations, and to be specific about what needs to be achieved at all times. We ask managers to remain focused, resilient, and optimistic, even in challenging times. We monitor progress against defined targets, provide coaching and feedback, and encourage idea-sharing. While it’s important for business leaders to carefully guide employees to achieve results, it’s equally important to clearly define those expected results, and to set realistic and transparent goals along the way. In the face of financial pressures, leaders may be inclined to set the bar high: they may ask their teams to reach for ill-defined or even impossible goals, vaguely asking their employees to achieve a turnaround. But actually turning things around means asking teams to complete specific tasks, each of which will add up to the measurable results needed for the business to operate successfully. Good leaders can define these specific tasks clearly and dig deep to discover marginal gains that make your team even better.

Getting back to basics

In a slowing economy, it makes sense for companies to focus on their core strengths, to shore up their connections and communications with loyal customers, and to prioritize achievable, positive results. In other words, it’s time to get back to basics, and understand the true mission of your company and its people. One initial step I took to get back to the basics was to minimize what is usually a very robust work-related travel. This gave me a concentrated opportunity to focus on some of my core management responsibilities close to our Plantation headquarters. For other companies, it could mean putting plans for expansion or an additional product launch on hold while you make sure the foundation of your business is healthy.

Within the challenges of an economic downturn, insightful business leaders can find and create valuable opportunities. By evaluating what parts of the organization are working best, even under stress, and by identifying the exact, incremental steps needed to achieve meaningful results, leaders gain a clearer understanding of their own mission. At the same time, they can connect more meaningfully with their teams, and learn what matters most in their organizations, in their own daily work, and in the way they define leadership itself.

I'm interested in hearing what you want to see from your leaders during more challenging times. Leave me some comments below.

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