The team was built aggressively in anticipation of high growth; the team’s leader was well-paid and had fought for raises for several of their direct reports. However, growth had stalled at the company, and as a result, the business was experiencing declines in revenue and profit as the team’s costs had increased substantially.

The CEO wanted my input on whether the team was correctly sized for the stage of the business, an issue he planned to bring to the department head. It should be obvious to anyone overseeing a P&L that having a larger, more expensive team overseeing less revenue is detrimental. I couldn’t help but wonder why the CEO was initiating this uncomfortable conversation rather than the department leader, who should have been aware of this dynamic.

Was the department head just hoping that the CEO would just look the other way at paying more for less in a down year? What customer of any product or service is ever happy about paying more for less? While there are several possible explanations for why the leader ignored the issue, it would have been far better to approach the CEO proactively with options to rectify the situation.

Most of us have experienced temporary paralysis when we encounter bad news or challenging realities. For example, we sometimes put off action after a health scare or fail to reckon with a financial setback because it’s difficult to face a problem head on or accept a tough new reality.

But the hard truth is that markets have ebbs and flows, and leaders must meet any given moment with the action it demands. In a buyers’ market for homes, you can’t list your home for a price that’s ridiculously above market and expect it to sell. In a sellers’ market, you can’t lowball sellers with condition-laden offers and expect to close a deal.

Similarly, businesses in many industries are adjusting to changes that require proactive action. After years of high growth and easy capital, many companies must now prioritize preserving their capital through efficiency. Job hopping and quiet quitting are wildly ineffective strategies in this environment. Similarly, leaders cannot overlook warning signs within their teams, hoping for a spontaneous turnaround, or assume that others will fail to recognize clear issues.

As I have written previously, the best way to navigate challenging times is to follow Jim Collins’ Stockdale Paradox: accept the brutal facts of reality but maintain hope that you can reach a better day through decisive action and resilience. Your eyes need to be wide open, and when there are signs of unsustainability or trouble, it’s rarely prudent to wait around for the other shoe to drop.

This has implications for both employees and leaders. Here are the considerations for each group to demonstrate value in tough times:

• For Employees: Don’t hide your head in the sand or wait around for directions. Employees can prove themselves indispensable by being what Liz Wiseman calls impact players: seek out opportunities to impact the company’s most important priorities, proactively offer support to leadership and try to make their jobs easier. Finally, always bring solutions, rather than just problems.
• For Leaders: Hope is not an effective strategy and not making a decision is a decision in itself. Pay close attention to your costs and revenue and act quickly in areas that have become imbalanced or unsustainable. Make hard decisions earlier before they become harder. Double down on what is working well, and pull back spend from what is not working, before you are asked.

Growth and prosperity excuse a lot of problems, or even hide them entirely. In tougher times, those problems will quickly be placed under a microscope. Doing nothing about an issue and hoping no one will notice not only creates more personal risk, but it can erode trust in your ability.

As Warren Buffett famously said, “Only when the tide goes out do you discover who’s been swimming naked.” This wisdom underscores the necessity of being prepared and proactive, rather than exposed and reactive, when inevitable reversals of fortune strike.

Contributed to Branding Strategy Insider by: Robert Glazer, Founder & CEO, Acceleration Partners, Author of Moving To Outcomes: Why Partnerships Are The Future Of Marketing

At The Blake Project, we help clients worldwide, in all stages of development, define or redefine and articulate what makes them competitive at critical moments of change. Please email us to learn how we can help you compete differently.

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What are the key behaviors that innovators display? In 2011, my mentor Clayton Christensen teamed with two other business school professors, Hal Gregersen and Jeff Dyer, to write a classic book titled The Innovator’s DNA. In it, the authors laid out five key behaviors they distilled from interviewing a range of famous innovators:

1. OBSERVING: A habit of paying close attention to the world around you and noticing what works and what doesn’t
2. QUESTIONING: A habit of asking probing questions that lead to new insights, connections, and possibilities
3. NETWORKING: A habit of actively seeking out diverse opinions and perspectives to hear others’ ideas and get feedback on your own
4. EXPERIMENTING: A habit of trying new things and constantly testing new ideas
5. ASSOCIATING: An ability to connect seemingly unrelated ideas in new and unexpected ways

It has been over a decade since that book was published, and we still haven’t seen a better list.

Rate yourself, one through five, on how effective you are at deploying each key behavior. Then, assess how comfortable you are at using each. Most leaders we work with don’t give themselves many fives on either list. The aspiration is there, but the behaviors may not feel comfortable and often get de-prioritized amid the crush of everyday activities. Moreover, the behaviors are inherently inefficient—practicing them well takes some time, and the results they achieve in any particular interaction are uncertain. That’s OK. If this were easy, then everyone would do it, and the impacts wouldn’t be described as innovation.

Consider how you can model these behaviors for others and perhaps tell people what behavior you’re practicing so that they can emulate it. The attitudes you convey also matter. If you exude optimism, you will enable people to confront change by looking for opportunity. Clark Gilbert, who now leads education for the Church of Jesus Christ of Latter-day Saints (popularly known as the Mormon Church), once researched this phenomenon when he taught at Harvard Business School. He looked into the effect a positive vs. negative attitude about the internet had on local newspapers’ decision-making. Those who saw it mainly as a threat got hammered. However, the few that framed it as an opportunity captured major upsides.

Positivity opens minds to consider possibility.

Contributed to Branding Strategy Insider by: Stephen Wunker, Managing Director of New Markets Advisors. Pre-order your copy of The Innovative Leader here.

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These brand-businesses do not have the will to do. So, something amazing passes through their systems causing lost chances, missed opportunities and the chance to get ahead of curve. Having the courage to commit to a vision or an insight is essential for brand-businesses, especially today in a fast-changing, volatile world. The courage to commit starts with brand leadership. Brand leadership is the key to action.

Brands thrive if leadership sees ahead and creates a plan for winning. Brands need to keep innovating in order to stay relevant. Brands need to keep in touch with their customers. Brands need leaders who love the core products and who want to make these better. But, brands also need leaders who can see ahead, adopt new ideas and act.

One of the criteria for great brand leadership is knowing the difference between being certain and being confident.

Looking for certainty is a dead-end street. Brand leaders who seek certainty usually will not have the courage to act. Death and taxes are certain: all else are not. On the other hand, confidence is critical. A brand leader who is confident that an idea is worth investing in has the courage to bring the idea to fruition. Being able to say, ‘No, I am not certain this will work, but I am confident this is the right thing to do,” is a mark of a great brand leader.

Great brand leaders are authoritative, credible, responsible, trustworthy and they have integrity. When great brand leadership is lacking, brands suffer. Those seeking certainty will jettison ideas because there is no way of supporting a world of no doubt. There is no way of having absolute conviction that something is true if it has never yet happened. Great ideas die when the brand leader, presented with a new idea, asks, “Can you give me an example of who has done this before successfully?”

In the early 2000’s, an appliance company created a smart fridge. It was years ahead of the marketplace. This fridge would have the ability to communicate when foodstuffs were going bad; it would be able to order food stuffs that were running low; and it had a computer that allowed you to keep a meal calendar and create meal planning. The smart fridge would be hooked up to your home Internet system and become a communications hub for the family. The appliance company made one of these. This one-of-a-kind smart fridge was trucked around to various cities and company offices. But, the smart fridge never saw the light of day with consumers. Leadership was unsure and non-committal. Leadership wanted to continue to know more.

Leadership was concerned more about failure of this product than the product’s success. No one could promise leadership the certainty of a win.

Today, smart fridges abound. Take the Samsung Hub concept. According to its website, Samsung Hub… “… with Alexa built-in, helps you stay connected to your family and home, whenever and wherever. Family Hub lets you control your Samsung smart appliances and devices, stream music, share pictures with your family, and so much more, all right from your fridge.” Samsung has always had leadership that respected innovation and accepted risk. As early as 2005, Samsung previewed a digital convergence fridge. It had a home organizer on the front door. This organizer had categories such as Food reminder, Digital schedule and calendar, digital memo pad and digital radio.

Samsung’s early innovations in clothes washers and dryers, again from 2005, changed the way other manufacturers thought about these appliances. Samsung featured the Silver Nano Health System clothes washer. This feature used silver ions that melt in the water to get rid of germs and provide sterilization. The video on the Silver Nano indicated that the silver ions decomposed detritus to 1/1000^th of a hair width, provided 99.99% sterilization and odor removal and removed irritants thus preventing atrophic dermatitis.

Ten years ago, in 2012, a hotel company had a plan for a net-zero, sustainable hotel. At the time, research indicated that a sustainable, responsible hotel would solve a problem for many travelers who expected products and services to reflect their personal values. The sustainable hotel’s concept was designed around the idea of innovating for responsible living. This hotel was to be a disrupter: a building that would be green from top to bottom. Partners with expertise in specific areas of sustainability and technology were signed; the specific location was identified and the land owner was eager for discussions to start. The innovation hotel would also be a pipeline for the company’s other branded hotels as new ideas could be tested, measured and managed in real-time with winning ideas transferred within the company’s system. Data showed that this sustainable hotel would be a profitable entity for the company, especially when it came to the key hotel-industry metric of RevPar, revenue per available room.

A team worked on the strategy and planned for months. Money was spent, presentations were delivered. And then, nothing… shelved with all the other what ifs.

It was the hotel that never happened. At least not at this company. Leadership was worried about short-term investment rather than the long-term profitability of the innovation. Leadership wanted certainty that this sustainable hotel would succeed.

Now, as reported in The New York Times, there are many hotels with the same sustainability concept that are actually being built or have been built, receiving guests. Leadership at these hotels are willing to commit to the greater good. As in 2012, once again new research states travelers commitment to eco-consciousness when it comes to the actual hotel. In a Booking.com survey, 71% of respondents say they plan to travel greener. And, more than 50% of the respondents indicate that they “are determined” to make greener travel choices. The New York Times states that these hospitality options are way beyond the ditching of tiny plastic shampoo bottles and asking guests to reuse their towels. These hotels are focusing on the entire building. These hotels are focused on environmental efficiency and effectiveness, from solar panels to zero waste.

When Boards of Directors, investors and analysts see the present and the future, and if they believe in strong, resilient, authoritative, trustworthy brand-businesses that will continue to generate enduring profitable growth, great leaders must be in place to make these insights realities.

Great brand leadership takes courage. Great brand leadership requires a will to do based on confidence. Great brand leaders know what they do not know and exercise informed judgment. Great brand leaders weigh informed action against inaction: they balance the need to know with certainty against the necessity for a confident decision. Great brand leaders take risks; they take leaps of faith based on informed judgment: they have confidence that these are leaps in the right direction.

Contributed to Branding Strategy Insider by: Larry Light, CEO of Arcature

At The Blake Project we are helping clients from around the world, in all stages of development, redefine and articulate what makes them competitive at critical moments of change through our in-person or online strategy workshops. Please email us for more.

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From the beginning, Mr. Hackett was asked to explain his plan for Ford. He made several attempts to articulate his vision for Ford and was continually criticized for making generic, uninspiring descriptions of the current state of the business and its direction. Essentially, Mr. Hackett’s problem from the beginning was his inability to articulate a vision for his turnaround.

The automotive trade bible, Automotive News, tracked Mr. Hackett’s obtuse musings on Ford’s vision. According to Automotive News, Wall Street was quite impatient with the vagueness of Ford’s messaging. On the one hand, Mr. Hackett was always honest in his comments, letting analysts know that Ford was not as competitively fit as its competitors and that the company’s revenue and volume had not grown as hoped for. There was revenue growth, but costs increased at the same time. On the other hand, Mr. Hackett did not communicate Ford’s way forward in an encouraging, meaningful manner. At the time, one money manager remarked, “When a CEO comes out and says it’s going to be a bad year, that’s not going to instill confidence in investors. There hasn’t been the data or the narrative to instill confidence. It created uncertainty around what success at Ford can be.” Mr. Hackett failed to articulate a specific aspirational ambition.

Meanwhile commentators and analysts were reassured that General Motors CEO, Mary Barra, was doing a very good job of creating a meaningful description for GM’s current goals and future goals 5-10 years down the road.

At Tesla, Elon Musk continued (and continues) generating rapture with analysts and investors even though each statement did not always come true. Mr. Musk’s statements are a testament to how an exciting vision is a powerful force. At the time, an analyst with Autotrader.com put it this way in The New York Times, “They (Tesla) haven’t delivered what they’ve promised, but does it matter? It doesn’t seem to matter to its investors and the customers who’ve put down deposits.” Tesla’s recent performance and value have outshone all its automotive competitors. Whether people like Mr. Musk or not, he has a vision of an electric sustainable future that is consistent and compelling.

After 6 months at Ford’s helm, Mr. Hackett’s vision for Ford’s future emerged. The October 2017 Ford vision generated more grumbles than golly gee’s. He committed Ford to cost cuts, shifting money to the money-making vehicles – trucks and SUV’s rather than sedans, moving manufacturing to China to save money – including the production of Ford Focus for North America, pivoting from gas to electric, simplifying and modernizing the company and, making Internet connectivity a priority. Mr. Hackett is credited with the reimaged Ford-150 truck and the re-emergence of the Ford Bronco. Additionally, Mr. Hackett began the Mustang Mach E electric vehicle that is about to begin manufacture.

But, rather than describe the world he saw and how Ford would win in this world, Mr. Hackett gave a manufacturer’s outline of how Ford could become profitable again. He provided the necessary short-term milestones while falling short when speaking of his aspirational intent. It was not clear to listeners exactly where the brand-business was headed. As reported in The New York Times, Mr. Hackett “… never presented a full turnaround plans with detailed financial goals and timetables… Ford presented only broad targets and revealed its plans piecemeal as it rolled out specific initiatives and projects.” A recent article in The Wall Street Journal commented that, “In the end, Mr. Hackett’s tenure was a stinker from an investor standpoint. Shares slid amid meager profits and product hiccups.”

A compelling vision is critical for organization alignment. Employees want to know where the enterprise is headed and what will be their role in making this future happen. Having a vision sends important messages to all stakeholders.

For example, in 1993, newly minted IBM CEO, Lou Gerstner (pictured), when asked about his vision for the company, replied that IBM was in a mess and he did not have the time now to indulge in vague forecasts. The press reacted poorly. Analysts and investors wanted a description of Mr. Gerstner’s vision for IBM: they said it would be helpful for quarterly guidance. The press and analysts were not asking for a futuristic, vaguely mystifying, inspirational message. They were looking for visionary guidance to better understand where IBM wanted to go and how it planned to get there. Changing his mind, Mr. Gerstner articulated his vision, which laid out an aligning pathway to decades of future success. Mr. Gerstner saw the future in e-business, something that was quite futuristic in 1993.

Mr. Hackett had a vision: he just could not articulate it internally or externally in a meaningful and compelling manner. This has hurt Ford’s bottom line and share price. Articulating a clear vision helps align the brand-business’ stakeholders… 1) what the world in which the brand will win will look like, 2) what will need to change for this world to happen, and 3) what the business role in this world will be? Having a vision is not a theoretical exercise; it is a necessity, especially in uncertain times. Having a strategic aspiration, a North Star, an opinion about the future provides a viable pathway for thought and action. As the late George Harrison put it, “If you don’t know where you are going, any road will take you there.”

Contributed to Branding Strategy Insider by: Larry Light, CEO of Arcature

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In an emotional video to employees, he said the current financial situation was worse than the worst ever quarter for the company, which saw about a 25 percent fall in revenue. “In terms of our business, COVID-19 is like nothing we’ve ever seen before,” he said. Given the brand is nearly one hundred years old, had survived the Great Depression, World War 2, and countless economic downturns, that statement has weight.

The 5-minute message has everything you want from a brand leader in a crisis:

• Radical candor: The empathy and visible anguish Sorenson feels are palpable. When he says this is the most challenging message he’s ever delivered, there is no doubt. He says, “As a leader, I have never had a more difficult moment than this one. There’s simply nothing worse than telling highly-valued associates – people who are the very heart of this company, that their roles are being impacted by events completely outside of their control.” And that’s the truth.
• A clear statement of the problem and the impact: In China, business was down 90%, overall, today business is down 75%. Without the actions, layoffs and business continuity plans enacted, he was clear that some properties may not be able to resume service once the crisis is over.
• Significant sacrifices the entire leadership team is taking: Neither he or Bill Marriott, Jr. will take any pay for the remainder of the year, and the executive team is taking an immediate 50% pay cut. Some might say that even at 50% this cut is still several times more than the lowest paid worker, but 50% is substantial and communicates solidarity.
• Immediate changes to corporate policies: Many corporate employees will be taking leaves of absence for at least 60-90 days, while others will be shifting to 4-day work weeks. The brand will suspend all non-essential travel, freeze hires except for mission-critical roles. At individual properties, food and beverage outlets will be closing and entire floors will be shuttered depending on occupancy levels.
• A sense of optimism: Based on early signs coming from China, Sorenson expressed hope that business will be restored soon as lodging demand is increasing.

As brands navigate this unprecedented time, brand leaders must continue to step up, be seen and heard by workers and customers. Clarity, transparency, empathy and hope are what’s needed right now. I encourage every brand marketer to watch Sorenson’s video. It’s a case study in how to respond in times of crisis and can only add to your toolkit should you ever be faced with a similar situation.

At The Blake Project we are helping clients from around the world, in all stages of development, redefine and articulate what makes them competitive at critical moments of change through online strategy workshops. Please email me, Derrick Daye for more.

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