In the current climate, it’s incredibly important to communicate the financial realities of the business to the entire staff, and not allow them to be distracted by politicians or media headlines. Third parties will have their own reasons for talking the market down – you need to make sure that your people stay positive and understand what the business needs to do to succeed.
You certainly can’t rely on politicians for a balanced view. Alistair Darling’s claim that the economic times faced by Britain and the rest of the world are ‘arguably the worst they've been in 60 years… and it's going to be more profound and long-lasting than people thought’ strikes me not only as poorly-presented, but downright wrong. And Darling’s boss, Gordon Brown, has gone from bad to worse. You could argue that his dourness and prudence are ideal qualities in a depression PM.
I’m not denying that the credit squeeze is pinching. Plenty of big leveraged buy-outs have fallen by the wayside for want of a spare billion dollars or two, and businesses looking for unsecured lending are having a hard time raising capital. But the worst conditions for 60 years? Every businessperson I meet at the moment admits the picture look bleak – then adds that actually, for them, trading is quite buoyant. (Maybe I just meet a lot of lucky managers…)
It’s your job to remind people why your prospects are not tied into the gloomy headlines. For instance, many British businesses are now more connected to the global economy than they are to the UK. Again, I acknowledge there are problems in some of the key economies in the Eurozone, the US and even Asia. But my point is that entrepreneurial managers and their FDs can look for business anywhere these days. So a slowdown in one geography doesn’t necessarily entail the collapse of your business.
So where does this leave us? Doom-laden politicians at home and a need to motivate entrepreneurial zeal on as wide a stage as possible? Macro-economic slowdown leaving many companies relatively unscathed? It all adds up to a need to be your own PM, and for your FD to be your Chancellor.
Let’s face it, the 2008 political vintage is not very good. They’re not leaders; they’re not even competent bureaucrats. So if we are headed for more testing times, the best way for your business to survive is to get your people focused on... you. You and your right hand man or woman can ignore headline economic indicators and focus on what your own business is doing. If it’s doing better than ‘the worst economic conditions for 60 years’ might suggest, be an inspirational team, keeping the troops upbeat. Think Blair circa 1997. If things are getting tough, be resolute – urging your people to find innovative ways to battle through and giving them hope. Be Churchill in 1940.
At least that way, you won’t have to deal with the dead hands of Brown, Cameron and Darling ’08 – and their fellow recession fetishists in the media – convincing your people that things are worse than they are.