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The Bank of Canada’s fight against inflation might lead to a downturn and hurt your company. Fears of the economy sinking are, of course, not new. We faced that uncertainty in 2020, when the pandemic hurtled at us.

“The common thinking is that each crisis makes people stronger and more able to cope. But this is not the reality. Compounding crises tend to make people more vulnerable – and more shaky,” Merete Wedell-Wedellsborg, who consults in the field of business psychology, writes in Harvard Business Review.

That shakiness means some of the normal crisis responses managers turn to won’t work as intended. She says you need to revamp your playbook, in particular paying attention to three managerial approaches:

  • Moving closer without suffocating others: When there are rumblings of a downturn, the first response from leaders is often to move closer to their troops. More meetings are called, more reporting required and more detail goes into every conversation as they try to understand what’s happening. It’s a need to feel in control, but can boomerang because that is not what staff wants. “On the back of the pandemic, where teams have learned to operate independently and with less oversight, a boss looking over their shoulder can feel like outright distrust and disenfranchisement,” she warns. It also can draw their attention away from doing their job to managing upward. They feel stifled while you at the same time might be clogging up your bandwidth with details and micromanaging.
  • Moving faster without turning frantic: It’s reasonable to want to act immediately and forcefully to deal with the challenges. “However, there is a fine line between urgent and frantic. Leaders must remember that the pandemic has made many people more brittle, not more resilient. Stress and mental health issues have skyrocketed. As a result, while most people understand the need of speed in a crisis, their tolerance for ‘pushy’ leadership is much lower than it might have been prior to 2020,” Ms. Wedell-Wedellsborg writes.
  • Increasing workloads without sacrificing relationships: Her third warning is that psychologically in downturns leaders become more task-oriented and less mindful of relationships. Off-sites are cancelled, talent programs are postponed, perks are jettisoned and courteousness and empathy forgotten since the times are too drastic to coddle people. “However, relationship work is not coddling; it is hard-core performance management. We have learned from the aftermath of the pandemic that good people rarely quit or ‘quiet quit’ because their job becomes more difficult or because times turn harder. They quit because they lose faith in their leaders, their colleagues or the future of the company,” Ms. Wedell-Wedellsborg says. So maintain a balanced approach around relationship and task priorities, taking care to be transparent with your team about the nature and quality of work relationships you expect to see during a tough period.

Ranjay Gulati, a Harvard Business School professor who co-wrote a 2010 Harvard Business Review article on “Roaring Out of Recession,” urges you to move past the survival instinct that can take hold and accompanying drastic cost cutting. “You have to remember that the best time to get ahead of competition is down markets, not up markets,” he says in the CharterWorks newsletter. Data on changes in relative market position between companies indicates the maximum churn comes in downturns. In fact, it’s very hard to leapfrog over a competitor when markets are booming.

Your job as a leader, he advises, is to create a growth mood – a belief that this is a time of opportunity. Sure, there might well have to be a cost-cutting agenda, but accompany it with a growth agenda. “That means sometimes even excess cutting. We’re creating the space, the resources, the slack to grow while others are in conservation, defensive postures,” Prof. Gulati says.

Consultant Erika James and Lynn Perry Wooten, president of Simmons University, stress that in a crisis great leaders prioritize learning. You need to move away from your normal ways of thinking – your biases and the echo chamber surrounding you of like-minded people – to make sure you are getting lots of input. “You need your leadership to be as bias-free, elastic, deft and dynamic as the circumstances rapidly unfolding around you and your organization,” they write in Harvard Business Review.

They ask you to consider three questions: Do you currently have access to diverse voices and sources of information within your team or organization, or even beyond its boundaries? Do you routinely build other team members’ ideas or feedback into your decision-making? What systems or processes might you need to put into place to surface and capture multi-stakeholder perspectives? “In the age of Zoom and Teams, the workplace has become meeting-intensive, so what other mechanisms might you use to capture good ideas from a diversity of perspectives?” they add.

Much of this will not be your first instinct. In fact, it won’t even be your third or fourth instinct. It’s often counterintuitive, even after the pandemic helped us to rethink new management approaches for that difficult time. Don’t suffocate your people. Consider the growth possibilities. And listen, listen, listen as you lead.


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Harvey Schachter is a Kingston-based writer specializing in management issues. He, along with Sheelagh Whittaker, former CEO of both EDS Canada and Cancom, are the authors of When Harvey Didn’t Meet Sheelagh: Emails on Leadership.