Stephen H Baum Leadership

I hope you find value in an update on what my friends and clients who are CEOs and business owners are doing at this stage of the financial crisis and worsening economy.

First, some context: in August of 2007, our CEO group saw the first signs of the approaching storm, especially our members whose business drivers include employee hiring by their clients. In September of 2007, we had a brainstorming session about both opportunities and protective actions. By October, several were implementing the first wave of protective actions: reductions in force, delaying capital investment and a host more to cut cost and conserve cash. And contingency plans with specific triggers were written. Those who could move jobs offshore continued to do so and made plans to do more with an eye to both cost reduction and proximity to non-U.S. prospective clients.

In the first half of 2008, the variety of actions increased.  Some hired additional salespeople to increase market share and experts in client retention programs to stay close to the most valued clients. Sales incentives and quota systems were revised as well. One business owner re-examined his business model and determined that raising prices by 20+% and slimming down to operate at a lower sales volume made sense.

More recently, another owner is launching a marketing and sales campaign targeted at his weakest competitors. Contingency plans for additional protective measures have been triggered, some before and others after the sub-prime mess exploded. And the degree to which the “boss” has his or her eye on the details of revenue and costs has increased dramatically. As one said: “If you are not watching metrics and milestones every day, you may blow it!”

My view has not changed since the Fall of 2007 when I said that the horizon for tough times is two years or longer.

If I receive enough comments on this post, I will publish a longer list of ideas as well as resources related to weathering the storm. By the way, you will also find material on this topic on the public website of Vistage Internatonal (see below).

http://vistage.com/