Current economic conditions are exascerbating the difficulty of already daunting leadership challenges.  We are already struggling with change as the structure of organisations shifts to a more open and collaborative management model; keeping a team engaged and productive during periods of uncertainty takes additional flexibility and skill.

It seems counter-intuitive; you would think that when the economy is bad and the supply of jobs is contracting people would be working harder in order to ensure their continued employment.   Well, perhaps some are, but uncertainty creates instability, and the manager who ignores that added ingredient does so at her own peril.  Why?  Because the uncertainty creates a disconnect in the normal process of employee motivation that can make it harder to keep teams focused on organisational goals.

Maslow’s theories illustrate that people focus on their personal needs in a distinct order.  Physiological needs such as food, water and shelter are the most critical, followed closely by security and safety.  Farther down the list are social, ego and self-actualisation.  So far so good; people will work harder to preserve their jobs because the job provides for their sustenance and security, right?

Well, yes, but that’s where the fun starts.  Most employee motivation is about more than just retaining the workers, it’s about keeping them engaged in the pursuit of organisational goals.  Great leaders attract and inspire talented contributors who successfully aspire as a group to achieve the purpose of the organisation through strategic process.

Uncertainty and unrest in the economy creates a dangerous feedback loop at the most basic levels of human needs.  While it is true that the health of the organisation as a whole is critical to the viability of individual jobs, employees who are being constantly bombarded by external messages that question the security of their job find it hard to look beyond their personal needs to those of the organisation.  In some organisations this can quickly morph into a toxic environment where selfishness interferes with reason.

Here are a few examples.  Corporate product teams can disregard external input when prioritising programs, sales leaders can implement flawed incentive plans that sacrifice strategic goals in favor of the tactical in order to drive quarterly numbers, partner programs can be modified to shift the focus to internal not collaborative success metrics.

It takes a strong and insightful leader to recognise and overcome the potential impacts of economic uncertainty.

Don’t lie to your employees; rather than attemting to avoid or downplay the challenges, remind them that periods of uncertainty provide the greatest opportunities for innovation and impact.

Validate the vision of the organisation and trumpet its potential.  Increase the transparency of the strategic planning processes so that the importance of the vision is clear and selfish activities are quickly identified and corrected.

Redouble the recognition afforded to employees and teams who are at the vanguard of innovation and show how their contributions are helping to move the vision forward.

Instead of avoiding the challenges such as layoffs and cutbacks, face them head on and remind the team that even though the overall economic challenges might be out of their control they are temporary, and that their continued efforts will pay larger dividends down the road.

Are concerns about the economy impacting your organisation?  How are you dealing with it?