Posted: January 09, 2014
Overcoming workplace fear in the new year
Part One: The first strategyBy Stephen Dietrich
The aftermath of the Great Recession has made most of us relatively more risk-averse. Fear has taken endemic hold in some industries and sectors of the economy, particularly those with a track record of rocky market performance, constant management change, and consistently lackluster earnings over the half-decade since the credit crisis began.
The "new normal" consists of change and constant evolution. In this new business ecosystem of relentless adaptation and improvisation, it is vitally important for leaders to make sound and thoughtful decisions from the outset regarding the overriding framework within which change and evolution are to be undertaken – and embraced. Investing in upfront planning, issue-spotting, and core-value-driven boundaries will yield huge dividends and avoid problems down the road.
Fear of change and the outcome of a decision can paralyze a company. Unfortunately, there are ample examples of robust companies suffering in the marketplace whenever there is change of leadership or shift in business focus. It makes sense that a company may suffer when there is an unintended negative event, but uncertainty can have a serious negative impact even when a company acts in a measured and thoughtful way.
This may occur when a fabled owner or CEO retires or if a new product that is outside the norm is introduced and rolled out. Often times, even before there is any real effect from the leader’s absence or the new product roll-out, the market assumes that the exit or product shift would spell trouble for the enterprise and the brand. Media outlets may write about the paralysis that will overtake the company because its middle management was afraid to act without the direction or approval of the fabled leader, or that indecision would cripple the company as it dealt with negative market response to the product.
Governments are equally subject to paralysis. Consider the Bay of Pigs and the many different points during John F. Kennedy’s presidency where the fear of communism and the belief that the USSR might actually use nuclear weapons caused inertia and almost led to war.
The following business strategies will help start 2014 off with a better approach to handling fear in the workplace:
Know Your Adversary
Understanding the motivations of adversaries or opposing sides in any situation is invaluable. Knowing what the goals are of all parties and working to address these goals will result in a more cooperative process, with less friction and potential misunderstandings.
My client, Adam, was selling his timing manufacturing business. We knew that the buyer, John was a successful businessman who loved recreational biking, but that he did not really understand the timing industry. Our approach to the sale focused much more on educating John about the industry rather than providing operational statistics about the company. John needed to feel as if he understood the business in order to feel comfortable with the purchase.
In another business situation, understanding the person’s motivation was a critical factor in a successful outcome. I was working with an accounting group on an acquisition for a client. During this time, the CPA who was assisting on the deal was up for a promotion to partner. I learned this about half-way through the transaction, but it helped me understand why he was constantly offering strategic advice, even outside of his area of expertise, and working so hard to drive the transaction.
Once I learned of the impending decision, I stressed to him that our client valued consensus among professionals and a sense that all of us were working for the client’s goals, and not against each other. After addressing the issue, the CPA and I were able to coordinate our efforts. He was allowed to do what he did best without feeling left out or that he needed to outperform. As a result, the CPA was elevated to partner later that year, and our client complimented both of our firms on how well we worked together.
Stephen Dietrich is a shareholder at the international law firm of Greenberg Traurig, LLP. Dietrich represents corporate and other entities in mergers and acquisitions, debt and equity financing, and restructuring transactions. For more information, email him at email@example.com or call 303-572-6502.