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Tough times are getting tougher. Almost no business is immune. When Google cuts back on free food and Goldman Sachs has to cut its work force and Warren Buffett watches profits drop 77%, it’s a safe bet that we are all in for a world of hurt.
As revenues for most U.S. companies drop and buyers cut back on spending, the vicious cycle is bound to hit your company sooner or later. And, I’m afraid to say, probably more than once over the next couple quarters.
While it’s certainly not pleasant and nobody’s idea of fun, facts are facts and reality must be confronted. While execs have to do the dirty work of cutting costs and reducing headcount, we are not, by any means, immune from scrutiny - and should be concerned about our own job security and income in times such as these. As an exec who’s been through this at least once or twice a decade for the past 30 years, please accept some advice on how to weather (and maybe even survive) the onslaught.
There is no crying in Baseball (and Downsizing)
While it’s certainly valuable to be compassionate and empathetic regarding people in this equation, it’s very important to be part of the solution, not part of the problem right now. Your boss (and boss’s boss, depending on where you are in the pecking order) doesn’t enjoy this kind of business moment any more than you do, so resisting or complaining or arguing about the reality and the options is not helpful. In fact, it’s often a way to get yourself up on the chopping block. The first couple percentage points of cuts are often relatively easy to identify and agree on, but after that it becomes very tough.
It’s one Hobson’s Choice after another. And almost every decision you recommend works to make your job more difficult going forward. The temptation to argue against the cut is acute. Many execs find themselves suggesting that some other division or department in the firm should bear the weight of a requested cut. Another temptation is to offer to make a large percentage of a requested cut, but not quite the whole number.
Since it’s usually a zero-sum game and the boss has already considered a range of options before handing down cost-cut goals, resistance is generally a bad idea. In fact, if there is a way to offer up more reductions in your area of responsibility that will usually be appreciated, since surely one of your colleagues is trying to wiggle out of his or her responsibilities. I’m not suggesting you be irresponsible in terms of not properly husbanding necessary resources to achieve your unit’s goals, but your performance in this kind of period will be judged on how quietly you went about your required duties.
On the flip side, take positive action. If there is something you can make more efficient, do it. If you can create a savings by partnering with another company or another unit within your company, do it. Keep moving forward, even while implementing downsizing requests from HQ.
Let me leave you with three concrete suggestions for succeeding in this environment:
• Maintain a positive, proactive demeanor
• Demonstrate added value by assuming increased levels of responsibility
• Recommend/implement actions that streamline ops & reduce costs
All ideas are welcome, so let’s hear them.
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Erik Sorenson is chief executive officer of Vault.com, Inc. Mr. Sorenson, 52, oversees the strategic direction of the global, New York-based media company. He is widely regarded as an expert on media strategy and industry trends, with experience spanning radio, local and network broadcast television, cable and syndicated TV, and the Internet. From 1998 through 2004, Mr. Sorenson served as president of the MSNBC cable news channel. He has won more than twenty Emmy awards as a writer, producer, and television executive.
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