Jockeying for Future Growth

by Randy G. Pennington

Business leaders are rightly concerned about recent government reports showing that worker productivity saw its sharpest fall in eight years, coupled with the largest gain in labor costs in more than a decade. Unfortunately, conventional wisdom blames plunging worker productivity on the gap between slowed growth and a company's ability to quickly lay off employees. And the first response is to immediately resume the mass layoffs that marked the early 1990s. So much for those recruiting messages about caring for people when times were good and employees in short supply.

Some restructuring is no doubt needed. A number of organizations need to trim bloated payrolls and inventories that grew out of control with the belief that the new economy would forever erase the prospect of an economic slowdown.

Nevertheless, it appears that many people did not learn. You can't cut your way to growth, loyalty, or consumer confidence. Organizations that act purely to protect their stock prices today will find themselves paying a premium for talent when the economic upturn occurs, whether it is later this year or next year.

Great companies are using the downturn to position themselves for the next round of long-term growth. Their leaders are keeping employees focused externally on customer needs rather than allowing them to look internally toward dismay over their future. And, they are helping employees stay connected and committed by aligning goals and creating a culture that promotes individual responsibility and trust. Individuals with the wisdom and courage to see beyond immediate challenges understand the following truths and act accordingly:

Everything is connected
Success depends on our ability to create interdependent partnerships where everyone takes responsibility for positive results. The leaders who will succeed understand the magnitude and simplicity of our connections. A layoff to lower costs also lowers confidence and has a ripple effect through the entire economy. The connection is multiplied with every news story. Do not forget that every decision you make is connected to every other piece of the economy. The partnerships that are being destroyed today will be critical in the future.

Past success proves you were right once
Continuous learning and improvement are not options. They are an obligation. Survival in a fragile marketplace dictates that each of us must be better tomorrow than we are today. Now is the time to re-examine every process, procedure, and system to ensure its effectiveness and efficiency. Small improvements that were ignored when times were good can lead to bottom-line results.

Integrity matters
If people don't trust you, they will look out for themselves --- even when it hurts them in the long run. You need others to look beyond their self-interests to the interests of the enterprise. Tell the truth and deliver on commitments. Everyone is watching.

Chances are we won't see these companies, which are choosing to buck conventional wisdom and sit out the downturn, in the press. But we'll recognize them in a few months when the economy cranks up again. They will be the first ones out of the gate with better productivity, innovative solutions and strong relationships with their customers.

© 2001 by Pennington Performance Group; Dallas, TX. All rights reserved.
This article may be downloaded for personal and professional development. Copies may be shared within an individual organization. All other uses of this material are strictly prohibited without written permission from the author. This article appeared in the Dallas Business Journal in June 2001.

Randy Pennington is President of Pennington Performance Group, a consulting firm that helps organizations achieve the results they want without sacrificing the relationships they need. For additional information or comments: contact via telephone at 972/980-9857; e-mail at Randy@penningtongroup.com; or on the World Wide Web at http://www.penningtongroup.com.

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