For the best companies, a downturn is not just a time to hatchet down and survive – it’s an opportunity to set themselves up to thrive in the subsequent upturn. They position themselves to thrive when the opportunity comes. They start finding and seizing opportunities in tough times. Leaders know that growth cycles are always longer than recessionary cycles.  Moments like these should be used by leaders to pause, reflect, learn and reposition where required.

The first thing is to stabilize the business. Protect it from downside risks and ensure there is adequate liquidity to weather the crisis. Then, and only then can one capitalize on the downturn in the longer term.

However, the real challenge for CEOs and Boards is – aligning or repositioning the organization on the critical (often competing) behaviors and activities that are required to meet the performance requirements of the current business, while reinventing (sometime dramatically) to be successful in the future.

Keep a weather eye on the future horizon

Be aware that the future horizon is far closer than it looks. Preparing for it is an ongoing day-to-day activity that requires steady focus and continuous action. If the objective is to create something new tomorrow, one has to start the journey of creating & building today. Start with questioning the status quo objectively; reassess set beliefs and assumptions; evaluate ‘best practices’ from the perspective of context to your business and for the new that is being targeted. Unless companies invest in the difficult task of creating the new today, they will fail in the future. No matter how big their profits are today – current profitability or scale does not guarantee future success. There are enough examples around us.

Leaders must also know that there is no such thing as ‘winning business’. All of  are in these journeys, not events. The cycle of business is an infinite loop - companies start, shut, reinvent or pivot to something different all the time. Some times there will be bankruptcy and a few times a merger or an acquisition. Which means, to successfully sustain in business, we have to stop thinking about winning now or tomorrow and constantly keep investing with improving governance, evolving systems and processes, innovating and repositioning to build the organization that is strong and healthy. The benefits of all these investments often make companies stronger in the near term as well. As they say – “Long term is just a series of short terms”.

The starting point of all of this is the ability of company to attract, retain, engage and create an environment where talent thrives. Talent is the fuel that companies need to fly and not capital.  The best companies and leaders know this and put this on top of their priority.

The best bet is talent

Today, talent is more important for an organization’s success than ever before. Investment in talent must be done with the same rigour and foresight as capital. Ensure that impulsive reactions to current adversity do not impact employee engagement and morale which are difficult to rebuild. Successful deployment of talent is largely a matter of creating an environment where the interests and ambitions of people constantly shape the strategy and future of the company.

Companies must constantly evaluate if they have right people in key roles and positions, who are the future leaders or even, which companies are wooing away your best talent; and does that mean anything for the trend in the industry.

Critical business questions are almost always critical talent questions. – most of the answers about the future and delivery on strategy lies in how you acquire and deploy talent. Talent, in my view, must lead strategy and not the other way around. Talent is the undisputed king.

Saying this is easier than delivering. Pushing people or talent agenda on top of the list is one thing. However, investing in programs, processes and systems that help you deliver on the priority, that will help deliver on the strategy is where many organizations fail. The key ingredients therefore are - culture that you create, how you reward for the short and long term, performance systems that encourage and motivate (not drive) people to perform and the belief that developing people is not a luxury but essential for an organization’s survival.

Many companies that are going on the path of being agile are beginning to question the need for “a standard way of doing things.” However, one needs to remember that agile companies too need to have “a fixed backbone” of structure, processes, and governance to support looser, more dynamic elements that can be adapted. Remember that in the end we are dealing with people, and what counts the most for them is the experience you deliver and that requires a consistent strategy and a plan.