Bad Times Require Communicating Bad News
by Miki Saxon
Leaders, with a few industry exceptions, have noticed that the economy is in trouble (duh), but they still seem to think that their people don’t know the facts (double duh).
Sadly, too many bosses, from Fortune 100 companies to mom and pop-owned small businesses, are clamping down, saying nothing, running scared, freezing, blustering, or some combination thereof.
The result is management by rumor, which once started never ends.
The way to deal with bad news is directly, openly and honestly.
Even when you have to lay off this axiom applies; in fact, it’s the only way that gives your company any chance of emerging with the rest of your workforce intact and productive.
Here are six basics to keep uppermost in your mind—Whether they are comfortable or not!
- Bad news must be communicated—just like good news.
- Employees aren’t dumb—they know something bad is happening—and if they’re not explicitly told what it is, rumors will make any difficulty a catastrophe and a catastrophe a death knell.
- Management must be explicit about the ultimate potential consequences. In a situation that’s unfolding, such as the current economic crisis, when no one knows what’s ultimate or can predict when it will change, frequent updates are effective.
- Everyone hates uncertainty, which is all you have to offer at present. Analyzing and then explaining the worst case outcome as well as what you’re doing to counter it and how your people can contribute goes a long way to stabilizing people and gaining their buy-in to your plans.
- Successful plans are dependent on how well they are communicated, which is what determines employee buy-in; if you choose the delusional approach of minimizing the situation then you should expect minimal results.
- Share the outcome of your thinking, whatever it is—layoffs, plant closures, project cancellations, etc. If you don’t trust your people with the information your problems are even more serious than you realize.
Any solution to a crisis must be seen as fair, reasonable, and businesslike. If management’s reaction is illogical, petty, slipshod, unrealistic, draconian or any combination of these, then it’s likely employees will conclude the ship is about to sink and leap off.
People understand that difficult situations demand difficult remedies, and they appreciate that management must at times step up to harsh challenges. But if solutions are irrationally or whimsically applied, they become a demoralizing factor, increasing the difficulties that people encounter in trying to do their jobs.
Finally, you should always attempt to find a positive note to leave with employees. Everyone already knows that things are bad; it’s your job to find a potentially favorable course of action.
Just remember, you hired your people for their brains, so don’t expect them to suddenly go dumb. Employees easily spot propaganda masquerading as a solution. Predicting an impossibly favorable outcome will not only demean management, it can also result in a lawsuit.
Image credit: sxc.hu
February 2nd, 2009 at 5:36 pm
Miki,
Well said. Because we are in difficult times, employees want information about how their organization is doing on a consistent basis, even if it’s bad news. Leaders just have to be up front and honest.
February 2nd, 2009 at 5:36 pm
This is indeed a tough problem where emotions get in the way and create all kinds of problems. I have gone through two recessions before this one, and I can certainly agree with much of what you say here.
One thing you underplay, however, is the value of not just informing employees, but also of recruiting them as partners in survival. In tough economic times, the opportunity for creating greater success after things turn around is immense, IF the right things are done while everyone else is hiding and cutting back. Having a devoted team that works together is the only way to make that happen.
I just started a new blog called “Dominate Your World” (http://alphadomination.blogspot.com/) that will be talking about how to make such things happen. Hope we can have some good conversations over the next few months between our two blogs about this critically important subject.
February 3rd, 2009 at 12:36 am
Hi Chris, You’re right, but it seems there are many “leaders” out there who seem to think that it’s business as usual, or, at the most, this is a little blip of inconvenience on the landscape.
Hard to tell the truth when you haven’t acknowledged its reality.
February 3rd, 2009 at 12:45 am
Hi Wes, good to see you again. You’re right about engaging people to be part of your solution. I wasn’t underplaying that, I just thought that I’d focus on one thing at a time.
I find it helps when trying convince senior management to do something that goes so far against so many of their grains:)
I’ll cover it next Monday. I hope you’ll come back and fill in the holes!
Congratulations and I’ll see you soon at your new place.
February 4th, 2009 at 3:18 pm
Congratulations! This post was selected as one of the five best business blog posts of the week in my Three Star Leadership Midweek Review of the Business Blogs.
http://blog.threestarleadership.com/2009/02/04/2409-midweek-look-at-the-business-blogs.aspx
Wally Bock
February 4th, 2009 at 3:49 pm
Hi Wally, What can I say? I’m honored to be included.
March 12th, 2014 at 1:16 am
[…] because of layoffs, it’s often by choice; either way it’s bad news and, like all bad news, requires clear communications to avoid […]