How to Inspire Your Employees During Lean Financial Times

Recent months have been particularly tough for leaders. On one hand, the economic outlook is stormy: a majority of CEOs have been expecting a recession (albeit a modest one). Investors are tighter with cash than a year ago, squeezing companies to reduce spending. Meanwhile, back-to-office rules, which are challenging for employees, and also painful for leaders to enforce, with some executives finding themselves implementing policies they disagree with.

Given this environment, it’s important for CEOs to be both nuanced and inspiring in their company-wide communications. Simply presenting the new playbook (lean, lean, lean, and back to office) isn’t enough. Nor is it sufficient to provide transparency on the reasons for these changes. Instead, senior executives need a tone that combines empathy for employees, transparency about the broader context, inspiration about the company mission, and—as far as possible—expectations for what lies ahead. Here’s how to do that.

Paint the larger context. As a CEO or senior executive, you have an institution-level perspective on the business issues you face. Remember that some of your employees may not share that perspective. They may be smart, talented, and informed, but their perspective is shaped by where they sit. 

You can help by framing cost cutting, for example, through a thoughtful discussion of the external environment and how your company’s long-term success requires some difficult adjustments to the broader ecosystem. You might say something like, “We’re in a difficult, unusual economic moment right now. Most experts anticipate a recession. VCs are sitting on cash because they think things will get worse before they get better. We want to weather this storm, so we have to tighten our belts.”

Make sure your tone isn’t condescending—some of your employees will be quite business savvy. But some may not be. 

Be transparent about the current reality. In general, transparency builds trust. Often leaders get in trouble because they know a lot more than what they are telling employees. You might be surprised at how much your employees can “handle” when it’s presented in a well-crafted way. For instance, “Because of these external factors, we anticipate that the next few quarters are going to be tight. And they need to be. Our investors need to see that we are being very careful with resources. And it’s not just us—most companies are going through a lean period. What this means to you is that there will continue to be high expectations, with few or no new resources. It may mean X, Y and Z.”

Authentically share something personal. Why are you sticking around during this tough period? What lights you up? Is it the mission? The people? Your relationships with your leadership team? Is there an anecdote you can share? “Amit came to me last week and said ‘You know, I’m more excited than ever about how our mission will transform the world.’ That was the highlight of my week!” What about your company’s mission excites you and provides you resilience during challenging times? Talk about that. And don’t forget to reiterate how important each person is in achieving that mission.

Provide hope and inspiration. As a leader your role is to share the truth, but also to uplift. Being transparent as a leader never means just showing people the darkness and leaving them there. What truths can you share about the company’s vision, or your hopes and dreams for the future, that might inspire them? “When I’m having a challenging week, I pause and think about our customers (or my children, or the patients we impact). It’s crucial that we keep our minds focused on the actual real-world impact of our mission.” Without making specific commitments you might later regret, point out that the level of leanness right now won’t last forever. Did you previously have money for raises, promotions, big bonuses? Tell them you look forward to those times again in the future when the external climate improves.

Yes, these are tough times for leaders. And it’s easy for CEOs and senior executives to get bogged down themselves. But in order to uplift and guide your company, you have to start by uplifting yourself. That means reconnecting with your own deepest sense of purpose and mission, and your own feelings of inspiration. If you do that, and invest the needed time in crafting your message clearly, you’ll go far towards weathering these tough times and setting your company up to thrive when things look brighter.