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We had a great call to my radio show, “The Winner’s Circle” on Saturday (follow the link at danmulhern.com to listen to the show live on Saturdays from 7-9 am). The caller said that he works at a tool and die shop that is in the process of being sold by the long time owners. Uncertainty is everywhere. Will there be layoffs, paycuts, new strategies? Is it even possible the company might close? The gentleman said that with anxiety up and rumors rampant, hardly any work was getting done. He told us that he was an upper level manager but even he didn’t know what was going on and therefore what to tell his team. He wondered if we had any advice. (I’ll share the advice I offered him in next week’s column.)
My guest, Katherine Crowley co-author of Working With You Is Killing Me, warmly empathized with this gentleman. She said she could understand how totally challenging and scary this situation could be for him and those he led. I could hear the relief in his voice, when he said, “yes it is.” Gosh, that step seems so simple: recognize out loud and with compassion how difficult something is. Now, Katherine is a trained psychologist, so she knows the importance of connecting with people’s hearts. But shouldn’t we all know this? To merger & acquisition folks, a job is a calculable ratio of cost to benefit. To an employee a job is food, a home (can you say foreclosure?), predictability, purpose, an identity, shall I go on? It makes human sense and business sense to empathize with people, even if, especially if, hard cuts may come.
Katherine’s co-author Kathi Elster also weighed in and she too nailed it. She told him that he should meet with his people as often as daily, and tell them what he knows. It may not be much, as information is being guarded closely. But information will always fill a vacuum. If top management isn’t talking someone will be, and they may be spreading false information, rumors, and even wild speculation. Kathi told our caller that he could allay some of the anxiety and the unproductive water cooler time by telling people what he knows, even if he just says about a rumor: “I have not heard that to be the case. I can’t say it’s not. But I have not heard it.”
If you’re in a place where there’s a whole lot of speculation and uncertainty, you’d do well to follow the advice of Kathi and Katherine: empathize with your people and communicate frequently and as honestly as you can. Be pro-active and pro-people, to
Lead with your best self!
* Jeanie Daniel Duck, “Managing Change: the art of balancing,” in Harvard Business Review on Change, 1998, p. 61 (orignally published HBR, Nov-Dec 1993)
Two problems with the sale of a company the upper level manager will face are suspicion and intentional false rumors.
It is almost impossible for a person near the top of the management ladder to convince all the employees that he knows nothing. He will often notice that the employees are less communicative, and more careful in what they say. This leads to reduced productivity and short term thinking replacing normal time horizon planning.
Anyone experienced with changed at companies will be watching for false rumors spread by the owners, and the agents the owners hire. Sometimes false rumors, such that a company is for sale are spread not long before labor negotiations start, in order to reduce the demands of labor in a new contract. The possible mind games are endless, and get more clever as time goes by.
There is an industry of specialists who will assist companies make changes like get rid of unions, or change owners, or change locations, et cetera. Sometimes a company is bought merely for its distribution system, with the purchasing company’s production for other places, including other countries, being sent to replace the local production.
The upper level manager has his own problems with deciding what to do, since often when a company is sold, the new owner will replace upper management, due to disagreements over management style, or however a person might call it, philosophy, or company culture.
The secrecy by the owners can seldom work in their favor for long, since employees will leave, and efficiency decline; even customers will start being cautious in placing new orders.
Mark John Hunter – Alpena
One thing that would help lessen the worry is if we had companies coming into our state providing new opportunities (ie Toyota, Honda etc.). Our State government seems to be frozen with fear on what to do. The only response from the govenor is to raise taxes and provide job training. If we make it beneficial for companies to come to MI, like other states, then we will get more tax revenue thru more employed tax payers and the companies themselves will provide the job training. Why should the state provide job training? That is rediculous.
It seems like the citizens of Michigan are watching a slow train wreck and its’ leaders are doing nothing to prevent it. The inaction from Lansing is causing alot of this fear to persist.
Vince, Appparently you have been out to lunch. First the state and the current administration has and is bringing jobs to Michigan. Are you not aware of the Toyota design and research center on the outskirts of Ann Arbor that recently opened in the last 12-18 months? Also, Hyundi Kai. And what about the Auto Supplier Bosch that expanded its operations in Livonia and added about 200 jobs That Company employs between 600 to 800 people. In Holland, Y2 Yacht expanded its operations and added between two and three hundred jobs. And of course, how can you overlook the arrival of Google in Ann Arbor. As far as training goes don’t depend on the Federal Gaovernment or the Private Sector to do anything that will help improve the employability of those among us who have to make themselves marketable.
No, you cannot replace every auto industry or manufacturing job that we loose and to understand why that is one has to have a very clear understanding of the significance the auto industry had on Michigan. A lot of people say they do but I doubt it. If they did then they would not be so quick to criticize efforts to attack the unemployment Problem in Michigan.
Carol Cain’s Business/Politics column in yesterdays Free Press commented on the Call for Leadership by our elected officials to spend some of their Spring Break vacation time in Michigan. Our Tourist Industry needs help, and we can’t afford to send all those travel dollars South during Spring Break.
ALSO – With the stress of uncertainty regarding jobs in Michigan, it’s necessary for everyone to have something to look forward to, and relieve the stress. A Spring Vacation in Michigan is the answer. It can be among the best vacation you’ve ever had ~ and IT’S AFFORDABLE. There are numerous Festivals & Events statewide, and the CHEF’S CHALLENGE for CHALLENGE MOUNTAIN in late April has something for everyone to enjoy. Check out http://www.chefs-challenge.com for something to look forward to, and thank God you still live in Michigan. Believe me, Spring is Special!
P.S. Tell Vince (above) that the State will be repaid soon after retraining. Better to have you gainfully employed, paying taxes and living in Michigan.
Would’nt it be better if you brought in the companies first and they train for specific jobs rather than the state wasting resources on training without the jobs available. It seems like they are putting the cart before the horse.
As long as the govenor refuses to make the hard choices and reduce taxes for corporations we will be training people for no reason and wasting alot of money.
You repeat a refrain from the right wing, but you ought to move beyond the generalities. You could not possibly have been reading the papers over the past 5 years to say “the only thing the governor has done is raise taxes and provide job training.” Go to Michigan.gov and read, Vince! There have been major policy changes related to alternative fuels and other 21st century sectors, tourism, investment in education, restructing state government.
But the tax tax tax right wing stuff is both factually and theoretically wrong. One important thing we learned from the “supply side” movement of the 80s was that we needed to focus not just on demand – impacting the economy by altering demand – but also on supply. The idea is that innovation and growth will come when we free up the supply side. There’s a lot of truth to that. We have to grow the pie, not just slice it differently. so, the question is how.
Taxes are ONE factor that affects businesses. (And the Governor and legislature have made significant pro-business, pro-investment tax moves, including eliminating the dreaded SBT. Again your idea that nothing is being done is just wrong.) But there are many other critical aspects to business location and investment decisions than taxes. Quality of life has long been recognized, for instance, as a powerful determinant of why companies choose to locate in one place or another. What has become increasingly clear is that in today’s economy, growth is also following talent. Businesses are looking for knowledge workers. Numerous comparisons of state data indicate that the education level of the workforce is the single most important driver of economic growth. You don’t do anyone a lot of good by simply repeating tired ideas that marginal tax rates are the sine qua non of economic growth, Vince. If we don’t invest intelligently in educating our workforce, we’re sunk. The rich will get richer, because they can do business FROM here, but we won’t grow businesses and jobs here if we don’t pay attention to work force knowledge and skills.
Finally, if you got beyond the trite rhetoric of the right you’d also know that the governor is NOT talking about generic job training. The training is targeted at specific job openings. Yes, they exist, for instance in health care and skilled trades. We continue to import nurses – great paying jobs that are looking for trained workers. And unlike what right wingers in their theoretical myopia see, it is decidedly NOT government vs. the private sector in practice. In practice the governor is constantly working WITH business, e.g., the health care system, to seek the most prudent win-win: where should the public/government come to the table and where should the private sector approach.
Finally, I wonder about the blind love of the market. I think it’s great that we have some public care and concern for laid off workers, and that we are trying to help them adjust to the major shifts in the global economy. I’m a businessman, and I believe in the market. But not blindly. I’m not a real big fan of the thousand or so indicted during the S&L crisis; I’m not a huge fan of the sainted market leaders at KMart who ran that business (and billions in retirement funds) into the ground; I’m no blind champion of the mortgage lenders who made foolish loans that were all but sure to econmomically cripple the borrowers who will pay a much steeper cost than most of the bankers who made those loans. The market, like government, does some things well and some not so well. It’s hard work to discern the differnece and not just cast around tired “liberal” or “conservate” truths that don’t match reality.
This column/blog is really not about politics, but if you’re going to keep weighing in, please take the time to get beyond the tired right wing generalities. Michigan has hard choices to make in whether to invest in lower tax rates (and if so which ones) and how to balance that with investment in the public’s health, education, and well being. Let’s talk intelligently about those hard choices.
In other words, do the hard work to lead with your best self 🙂
I am so tired of hearing that the only way to improve the business Climate in Michigan is to cut Taxes and make Michigan a Right To Work State. 1st, Engler boasted that he enacted 32 tax cuts. Yet how come when he left office he left the current Governor a one Billion dollar shortfall? And if Tax Cuts were supposed to be such a boon to make this a business friendly State, why didn’t any of his tax cuts stop the the loss of seventy thousand jobs per annum in his last two years of office? When John Engler became Governor, the unemployment rate in Michigan was over 6%. When Engler left office the unemployment rate was over 6%. And how about our President. He was left with a huge surplus when he took over and yes he thought we needed to have our taxes cut. The only problem was that President Bush did not cut Spending. What we have to show for it is an unpopular war, a trade deficit of over 600 million dollars and a rising national debt. What an astute businessman!If taxes are so onerous in Michigan why does new York thrive? California? Chicago? Boston and Masssachusetts?
I didn’t know that providing jobs by bringing corporations into the state was a “tired right wing generality”. I beleive government has a porpose but it is not to become the den mother to its inhabitants. It is beyond me that anyone can assert that government is the answer. Look at the government programs around us. Public education is in shambles and all we hear is “we need more money”. When is it enough!!! We have a govenor who road into office with the money of the special interest of the unions in this state and leading with her best self interest is afraid to make the needed changes (ie restructure pension funds and yes the dreaded dirty words “right to work”) to save her own hide. Many manufacturing jobs have left the US but millions have also flooded in but to the southern states where workers only make about $25 an hour plus benefits.
Giving the few in government more and more power is a dangerous path and allows the taxpayer to not take responsibility for their fellow citizens. The refain will be that the government should take care of that.
I am a business owner and have madde drastic steps to keep the 85 employees I have from being unemployed. We had to restructure our pension plan, health care plans and we now rely on performance for pay increases in the form of bonuses. Every business owner I know has had to do the same but when we look at the state government we see a different world of political ambition funded by unions that have a stranglhold on the citizens of this state. The terrifying thing is that the govenor has nothing to lose if the state falls apart. She has nothing to worry about because she will be fine. In fact she may even get a cushy job in a Clinton administration. Meanwhile those of us who actually make daily life happen for others will continue to see opportunities flee Michigan.
Dan please start leading with the truth. It will set you free!!
i keep hearing about tax cuts mostly by republicans,if they are interested why don’t they start with thier pay check lower that by 30%.After all thats tax money.All they ever talk about is cutting programs.
It is funny you should mention that. When work and opportunities started flying out of the state we had to restructure the entire cost structure of the company to keep it solvant an our employees employed and that included a 35% pay cut in all the owners salaries. I currently make less now than I did 10 years ago.
I hardly think the Govenor and state politicians have made the same cost cutting measures. Thats right they want to increase taxes. Again the path of least resistance.
This debate is interesting. A few things stick out.
Vince, you obviously feel the heat every day with the fate of 85 employees in your hands. The sacrifices that you’ve made to keep your company afloat go against the wind of the executives that Dan mentions (S&L, KMART, etc.). Thank you for doing the right thing — self sacrificing for the greater good. If I were you, I too would like to see the government step up and act like they were in the private sector instead of simply raising prices (taxes) time and time again and not face the difficult decisions of the day, which includes the things you have already done (pensions, retirement, health care).
This is true leadership being exhibited. While I don’t agree with all your points Vince, I do think it is a marked contrast when compared to the failed experiment in quasi-leadership that we all witnessed in Lansing last year.
Thanks for the kudos to Vince. Vince, kudos to you to work to keep your business going and to provide jobs. Kudos to the governor – are facts truth??? – for negotiating contracts that included $170 million in concessions from state workers.
The Governor has given back a share of her salary since we faced the first crisis (first 10% then 5%) – every year. Maybe the legislature will do the same thing. Last I checked which was months ago that effort to lead by example had stalled in the republican-controlled senate. Not sure where it stands now.
But Vince, my beef with your responses, is that they are nearly pure generalizations. Did I say “government was the answer?” You blitheley ignored about 80% of what I said. Is that how I’m supposed to get the truth that’s going to set me free? Are taxes your over-riding business decision? Does the quality of your workforce matter?
And are all the schools failing, as you suggest, therefore proving govenrment can do nothign right? My schools are doing an amazing job with my kids. I’m pretty happy with them. In fact, that’s what the vast majority of people say when asked: my schools are great. Yet somehow overall they’re terrible. Now, are urban schools working really well? Few would say yes. Is that a problem with “government?” Maybe. Charter schools, which are quasi-government have been a really mixed bag. The market – left to its own druthers – totally abandons the poor (because by definition there’s no profit margin or even a break-even point as Catholic schools have seen in large cities across America). Now, this is a serious problem, Vince. We can name-call, or we can try to figure out how to invest in these children, with some mix of public and private organizations to make a difference.
Okay, brother, the beat goes on! YOu’ve got to keep those 85 people gainfully employed, and I better get moving with the truth setting me free and leading with my best self.
I make a point of telling as many people that I can that in these uncertain times anything can happen anywhere, anytime so be prepared emotionally, mentally and always be looking agressively for your next opportunity. About three years ago I convinced a former CEO that he needed to sell his company for his own good; I then went home and told my wife that it was “not a matter of if, but a matter of when”. I wanted her to be as prepared as I would be for the job hunt. I have since counseled many friends and former colleagues on being psychologically prepared for the almost inevitable career transition.
Nice use of this forum to post commercials for your own events, Joe Breidenstein. The response by Joe borders on absurd. It has nothing to do with the column. The only relevant part is when he kisses up to the First Gentleman’s sleeping partner by admonishing Vince’s comments that job training isn’t going to work because there’s no jobs for these people to take unless they get “blown away” into another state. I guess it’s easy to sit on top of the (ski) mountain with the cast from Top Chef and make such assumptions while sending out your own PR feeds.
Just in case anyone hasn’t tried it, there’s a product out there that I’m just in love with. It’s called Coca-Cola. It’s refreshing with a great taste. Why don’t we all band together and buy this great product which is exactly what we all need? It’s something that will relieve stress and we all know, the people of Michigan deserve some stress relief these days. It’s something everyone can enjoy. It will be amongst the best drinks you’ve ever had! Believe me, Coke is special! Go to your local grocer today and support the local economy by purchasing this.
Maybe we should all lighten up, PR Spin Man, and go have a FAYGO, already!