Effective leadership traits are important to any organization in normal times. In extraordinary times such as now during the COVID-19 pandemic, these traits are critical.
Non-essential businesses and schools have been ordered to close, causing large swaths of the economy to shut down. Unemployment has risen astronomically.
Those with jobs are concerned if they are next to be laid off. Small-business owners may not have the staying power to outlast the pandemic even with the federal government’s Paycheck Protection Program under the recently passed CARES Act.
Doctors, nurses and first responders are on the front line in the battle against COVID-19. They run the risk of getting infected by the people they treat, and risk infecting their loved ones when they return home each day. Their stress levels are extremely high.
So, what are five leadership traits needed to navigate the COVID-19 crisis?
I intentionally list two traits associated with employees first:
1. Show empathy and concern
Let your employees know that you understand what they are going through. Relax policies if it helps them deal with personal issues caused by the pandemic. If your financial situation requires you to make a drastic reduction in expenses, consider reducing everyone’s pay, including your own, and explore other options before laying people off.
The restaurant and hospitality industries have been hit especially hard. If you are providing employee health insurance, continue to pay for it so employees are not left uninsured.
If layoffs are necessary, start a fund into which customers can contribute to help those employees in financial need. If you were a customer and have the financial means, contribute to a fund that will help those who have provided service to you prior to the pandemic. It’s now your turn to help them.
2. Instill confidence and credibility
Be a visible leader. Communicate the facts to your employees and at the same time, let them know the steps you are taking to deal with the crisis. If possible, connect with them personally. Provide a forum so they can dialogue with you. They will ask direct questions. Give them direct answers.
Ensure you continue to nurture an environment in which your employees feel they can share their views with you. Respectfully debate issues with them. At the end, you may unearth a better solution to an issue that had not been previously identified.
As the leader, instill confidence in your employees that you are taking the right actions to get through the pandemic.
3. Treat cash as king
Delay operating and capital expenditures that are not critical to the operation of your business during the pandemic. Delay payables to suppliers to the extent possible. Be mindful that they also need to pay their own bills.
Manage receivables by providing an incentive to customers not to delay payment to you. Ensure inventory levels are consistent with reduced demand. Delay payments into employee 401(k) plans.
4. Be open with your bankers
These are the people who will play a key role in the sustainability of your business through the pandemic. Let them know your plan of action to conserve cash.
Ask them to suspend payments of principle on your loan and if you could only pay interest until your business recovers. Operate in a way that your bankers have confidence that you can weather the storm.
5. Tap the opinions of your board members or other advisors
Every leader should be surrounded with advisors with expertise in various areas. During the pandemic, reach out to them. I currently sit on five nonprofit boards and the board of a private equity firm. The leader of each has involved their boards in planning how to move forward during the pandemic.
The pandemic is forcing everyone to learn new skills and new ways of doing things.
Some of these will be embraced after the pandemic ends because they are found to be more effective than the old ways. Working from home will become more widely accepted. The use of video conferencing could replace many in-person meetings.
We will not bounce back to all the ways we did things after this pandemic ends. Based on what we have learned, we will bounce forward to create a new normal. The leaders of organizations who bounce forward and embrace change will thrive in the new upcoming post-pandemic environment.
Stan Silverman is founder and CEO of Silverman Leadership and author of “Be Different! The Key to Business and Career Success.” He is also a speaker, advisor and nationally syndicated columnist on leadership, entrepreneurship and corporate governance. He can be reached at Stan@SilvermanLeadership.com.