Since March 2020, nearly every business in the United States has faced unprecedented adversity. Due to the fallout of the deadly COVID-19 pandemic—including the shutting down of entire sectors of the economy—many businesses have closed. Many more will close. This tragic period of lost lives and lost livelihoods is an extremely difficult time to be a leader.
Over the past few months, you’ve probably taken several important steps as a CEO: You’ve determined whether this is an existential crisis to your business, preserved cash as much as possible, and done your best to communicate candidly to your employees, customers, and shareholders.
But a time of adversity is also a critical time for CEOs to reexamine the fundamentals of their business. My time serving as CEO of NetQoS was bookended by the recession after 9/11 and the Great Recession beginning in 2008. Both of these became opportunities to redefine the essentials of success—and to define who I was as a CEO.
When the terrorist attacks of September 11, 2001, happened, the country seemed to grind to a halt, including our business. Things were so bad in the wake of the tragedy that I had a customer tell me that he thought we had the best new product he had ever seen, but if it cost more than the dollar in his pocket, he couldn’t buy it. As we walked the halls of NetQoS in those days, the fear and uncertainty were visible on passing faces. Fortunately, by doubling down on the essence of the business over the following weeks and months, we were able to survive the slowdown, once again reaching regular double-digit growth.
In many ways, the current economic situation is different from previous recessions. But as you preserve and rebuild your company through whatever comes, I encourage you to use this opportunity to return to the fundamentals of your business using a simple framework: Align, Engage, Predict.
After 9/11, our team at NetQoS needed a crystal-clear game plan for how we would succeed in a new reality. That meant creating alignment around what success looked like. We started by reexamining our mission and vision to make sure we hadn’t missed a fundamental change in the market. From there, we implemented the practice of measuring what was most important across every division of the organization. For each department, we asked: What is our mission? Whom do we serve, and how do we serve them? I asked my HR head, what is a good HR department? What does it do, and how do you measure that? I asked my marketing head the same. And so on.
By the end of the exercise, we knew precisely what each department needed to focus on. Each department displayed their key metrics on a bulletin board outside their office. The big-picture result? We created a fresh sense of alignment around the things that mattered most.
Next, the executive team and CEO must engage the entire organization in the newly refreshed mission and vision. The primary tool here is consistent, abundant communication. To remain engaged even as they feel uncertain about the future, the entire workforce needs to hear from the CEO consistently about the top-level priorities of the company. And each manager in the company should work with employees to set specific, near-term goals that allow each person to engage in the broader success of the company.
The Engage step also demands transparency. During the downturn of 2001–2002, I told employees that, while I couldn’t promise that we would never have to lay people off, I could promise that I would be honest with them about how the business was performing. When we did have to do a small layoff, no one was shocked, because we had consistently communicated the struggles in the business and the need to cut expenses. This type of transparency is key to keeping people engaged in the mission.
Finally, the CEO needs to constantly keep their eyes on the road ahead. That is never truer than in a period of adversity, when circumstances can change rapidly. Each week, the CEO must revisit the business fundamentals with executives, asking each to project whether key metrics will be hit. Asking people to predict an outcome—rating the likelihood of meeting a certain revenue number, launch date, or other measurement—results in far more insight than asking for historical data. As CEO, your concern is not what’s already happened, but whether the organization will predictably meet its commitments.
In the years since I led NetQoS, I have served as CEO of both public companies and startups. This core process of Align, Engage, Predict has become critical to how I lead, and even became the backbone of an enterprise CEO platform called Khorus.
As the coronavirus, and the actions taken to contain it, ravage lives and the economy, we have decided to make Khorus free to CEOs at companies of all sizes. This is not some watered-down version of Khorus, either, but our full-featured enterprise-class software—no strings attached. You will be able to align every member of the team around corporate priorities, engage them with goals of their own, and have everyone predict key outcomes each week.
In these difficult times, every company should be focused on aligning, engaging, and predicting the performance of their organization. They will now be able to do that free of charge. Please visit www.khorus.com to get started today.