Jackie Zach
February 15, 2024
e latest episode of the Tough Love for Business podcast, Jackie Zach and Mike McKay discuss the essential qualities of effective leadership during a crisis, inspired by a recent article about Microsoft’s CEO and the company’s response to a challenging situation with OpenAI. They emphasize the importance of maintaining composure and focusing on what can be controlled rather than reacting with panic or blame. Drawing parallels to historical events like 9/11 and the Great Depression, they highlight how some businesses continue to thrive amidst adversity by concentrating on their core operations and seizing opportunities that others might overlook.
The hosts stress that crises can be transformative, encouraging leaders to reflect on their responses and how these reactions affect their teams. By projecting calmness and recognizing the efforts of employees, leaders can foster a positive environment that encourages resilience. They note that economic downturns often present unique opportunities for growth, urging listeners to prepare for future challenges and remain proactive. Ultimately, the episode serves as a reminder that in times of crisis, a composed and focused approach can lead to success and long-term growth.
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Podcast Transcript:
Jackie Zach: Welcome back to the Tough Love for Business podcast. I’m Jackie Zach, and I’m here with my co-host, Mike McKay. Today, we’re talking about leading through crisis. The idea came from an article I saw in Inc. Magazine about Microsoft’s CEO and a situation involving Microsoft and OpenAI. There was a crisis over four or five days, and the CEO posted a tweet thanking the team for staying focused on the customers, the mission, and remaining calm despite the pressure. This happened on Thanksgiving, which I thought was interesting. Crises in a company can lead to many reactions, like panic, anger, or blaming others.
Mike McKay: Yeah, you can also complain, thinking life is happening to you instead of for you.
Jackie: Exactly. Or, you can do the opposite—learn from it, control what you can, and appreciate the efforts of your team. That’s what the Microsoft CEO did. So, when a crisis hits, what’s the most important thing a leader needs to do first?
Mike: Step one: check yourself. How are you responding? Everything is neutral until we give it meaning. In a crisis, it’s easy to panic—everyone’s been through the pandemic, so we know that feeling. But sometimes what’s happening isn’t actually happening to you. Like in the Microsoft article, the crisis was around Sam Altman being fired by OpenAI’s board. It’s natural to feel affected by big company events, but the real question is: how does this impact me? Does it change my day-to-day? Most times, the answer is no. You need to focus on your business and keep moving forward.
Jackie: Right, and as a leader, you need to project calm. Freak out if you need to, but be calm in front of your people.
Mike: Exactly. There are so many situations people react to as crises that don’t really affect them. Remember 9/11? People thought the world would change overnight, but if you were a local business—like a remodeler—you still remodeled houses. A restaurant still cooked food. The same applies today. If you’re a realtor, for example, and interest rates jump to 7% from 2.25%, people still buy houses. Some realtors freak out, but others are still making money because they focus on what they can control.
Jackie: And most of your competition will be freaking out.
Mike: Exactly. That’s why recessions are great times to grow. Some businesses start during downturns. One of my clients started hers in 2009.
Jackie: I started mine two weeks before the financial crisis in 2008. I had to put my head down because it was my only income. I stopped watching the news and just focused on what I could control.
Mike: Exactly. Even during the Great Depression, businesses started and some Fortune 500 companies came out of it.
Jackie: Right, 25% were unemployed, but 75% were still working.
Mike: Exactly. Even during the Global Financial Crisis in 2008, construction didn’t stop—some people kept building because they had cash. The point is there’s always opportunity if you take off your blinders and stop listening to the hysteria. You’ll find gold mines in times of crisis.
Jackie: And now is the time to prepare because there’s always going to be another crisis. Business cycles go up and down, but how prepared are you to take advantage of the next one?
Mike: I was doing research for a Daily Dose and found that over any 20-year period, the economy retracts on average for about 264 days, but it expands for 1,750 days—five times longer. So even in a crisis, opportunities will lead to longer periods of growth if you act on them.
Jackie: Exactly. So the first step is to evaluate what you’re doing, thinking, feeling, and saying. Stay calm because your employees will feed off your energy. The Microsoft CEO recognized the hard work of his employees despite the crisis. It was a masterclass in leadership.
In a crisis, remain calm, focus on what you can control, and appreciate the good things happening. Avoid short-term, panic-driven decisions. You’re a professional business owner, so go kick some ass.