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I Am Wasting a Perfectly Good Recession!
September 3, 2010
Written By: Russell Jensen

I had to laugh last week when a long time client pounded his desk and loudly exclaimed “I am wasting a perfectly good recession!” “Luke” (not his real name) got my attention. He was thinking specifically about failing to make some difficult staffing decisions during the downturn. His reasoning is pretty typical for a small town employer; I see these people in church, I know their families and their personal situations, and it is still harder for me to let them go than to “accommodate” them.

I couldn’t stop thinking about Luke’s comment that day, so I fired off an email to a number of clients and business acquaintances and asked them if they were wasting a perfectly good recession, and if so, how?  Apparently that was an interesting question, because I was peppered with responses almost instantly. My phone rang within seconds of sending the email, and it was my client “Scott” (not his real name) calling. “Which of my senior people have you been talking to? Some of them have been telling me that exact same thing!” He went on to tell me he knows he has some senior people the company has outgrown and he really needs to address that situation, but he just can’t bring himself to do it. What’s interesting is that several of his key people are putting more pressure on him, holding him accountable for leading and making the hard decisions.
Responses to my question fell into two clear camps. A frustrated “yes, we are wasting this opportunity” and a quiet “no, we’ve taken some actions we otherwise might not have.” Here are some of the responses.
Yes, we are wasting a perfectly good recession
  • Our strategic plan outlines strategies for acquisitions, targeting customers of vulnerable competitors, and upgrading talent in key roles, but we’ve been paralyzed and have not acted on any of these. We’ve missed some great opportunities and it looks like we’ll miss more.
     
  • We’re still avoiding some tough personnel decisions.
It is interesting to note that key leaders in both of these businesses are not on the same page regarding these issues.
 
No, we’ve taken some actions we otherwise might not have
  • We took advantage of some attractive pricing and bought some heavy equipment. Based on what we’re seeing in that market today, that was a very good call.
     
  • We accelerated our plans to buy land and a build new building. The market was too favorable to stick to our original timeline.
     
  • We’ve been intentional about upgrading talent at key positions. Competition for good talent is actually pretty stiff right now, but we’ve been able to hire some experienced talent that we most likely wouldn’t have been able to attract a few years ago.
     
  • We worked hard to streamline our operations, improve our processes and right size our workforce, all things we should have been paying more attention to in the past.
     
  • Our value proposition has always been about demonstrating a measurable ROI to our clients. We made this a clear priority and are pleased with the results
And, as you figure out to which camp you belong, I’ll leave you with a final thought. One business leader sent this thoughtful response that echoes what we are hearing from others throughout the course of our client work. 
 
He wrote:
 
”I get the feeling that some companies use the recession as an excuse to do what a good manager should have done in the first place – staff efficiently, manage performance, manage supplier costs, etc. Worse yet, I wonder how many firms eliminated salary increases, stopped 401K matches, reduced staffing without business justification only to pump short term profits but with the recession as an excuse. Reducing costs to increase profits or in response to a downturn in revenues is a perfectly good thing, presuming that it is sustainable or if the short term benefit (survival) can justify the long term impact on the organization.  But, to blame “the recession” for management’s actions is just lazy management. Your employees and customers will see through the insincerity and won’t be there when you really need the help.”

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