A senior executive in real estate and finance offers his perspective on the three keys to navigating turbulent times and emerging stronger.

All business leaders face challenges during their tenure. Some challenges are internal, involving personnel or perhaps legal issues. Others are more global in nature, as is the case today with the U.S. economy facing a potential recession, higher interest rates, and the fallout from a recent banking crisis. During these trying times, strong leadership is crucial.

By measuring performance, maintaining liquidity, and ensuring transparency, you can survive the storm and emerge stronger on the other side.

Measuring Performance

Accurate and timely data about the performance of your company provides a profound understanding of its overall health. Leveraging the information to enact timely adjustments not only impacts the course of the company but also facilitates swifter feedback about the efficacy of the strategies and tactics you’ve implemented.

Common ways to measure performance include:

• Objectives and key results (OKRs). Individuals, teams, and organizations use OKRs to define measurable goals, track outcomes, and align efforts. OKRs promote a results-oriented culture by emphasizing measurable outcomes rather than just focusing on activities or tasks.
• Key performance indicators (KPIs). KPIs are quantifiable metrics for measuring the performance and progress of a company. They are selected based on their relevance to the company’s goals and objectives and serve as benchmarks for evaluating success.
• Customer and team satisfaction. The ability to measure customer and team member satisfaction ensures that financial metrics are inclusive of the impact on key stakeholders. Customer satisfaction can be measured through surveys, online reviews, customer complaints, and tracking retention rates. Team satisfaction can be measured through employee surveys, monitoring retention rates, and 360-degree feedback.

Maintaining Liquidity

A business’s ability to maintain liquidity is paramount during uncertain times. Liquidity refers to the ease with which an organization can access cash or cash equivalents to meet its short-term obligations. To ensure your business remains liquid, you must:

• Monitor cash flow closely. Keep an eye on your company’s cash flow to identify any areas of concern early on. Regularly review your accounts receivable and payable and look for ways to streamline cash management processes.
• Control costs. Economic instability often necessitates cost-cutting measures. The key is to control costs without sacrificing your company’s long-term growth. Consider prioritizing essential expenses, renegotiating contracts and vendor agreements, and optimizing processes and operations to obtain greater efficiencies.
• Expand financing options. Diversify your sources of funding to avoid overreliance on a single source. Look into options such as long-term loans, lines of credit, or equity financing to bolster your financial position and provide additional liquidity if needed.

Ensuring Transparency

In times of uncertainty, employees often feel anxious and insecure about their job stability. As a leader, it’s your responsibility to provide reassurance and maintain morale. To do this, you must be transparent with your team about the challenges your company is facing and the steps you’re taking to address them.

• Keep employees informed. Regularly update your team on the company’s financial health and any upcoming changes. Be honest about the situation, but also remain optimistic and solutions-focused.
• Involve employees in decision-making. Encourage employees to contribute ideas for cost-saving measures and process improvements. This not only fosters a sense of ownership and accountability but also can yield valuable insights from those on the front lines.
• Demonstrate empathy and support. Show genuine concern for your employees’ well-being and be understanding of their concerns. Offer resources and support to help them navigate personal and professional challenges that may arise during difficult times.

In times of crisis, clear and concise communication is key. Relay messages in a way that employees, clients, and stakeholders can easily understand and accept.

Remember, economic instability, though daunting, can also present opportunities for growth and innovation. By measuring performance, maintaining liquidity, and being transparent with staff, you can guide your company through the storm and emerge stronger.

Leadership in crisis is not just about making it through. It’s about laying the groundwork for a more resilient and prosperous future. By tackling challenges head-on and demonstrating strong, principled leadership, you can survive the trying times and thrive in the days to come.