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Managing During a Crisis


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There's no doubt we are in a difficult time. We are facing a global pandemic and ensuing economic crisis that is likely the most difficult situation the world has faced in generations. The past few weeks I've had many conversations with founders and CEOs about what they are doing. So let me share some thoughts and observations for managers, leaders and founders.

During a time of crisis the most important points are:

  • Communicate
  • Develop contingency plans
  • Make hard decisions
  • Take bold action sooner than later

Without getting political, it's clear that leaders in many countries have not done a great job in these areas. That makes it even more important for business leaders to step up. Not only to help flatten the curve, but also to provide guidance to their customers and employees.


Communicate to your employees, your customers, your partners, your investors. People need to hear from you, whether you're the CEO, an executive, or a manager. Especially with many tech businesses operating in a remote / work from home environment. Reach out one-on-one with people, not just your direct reports, but everyone. Ask them how they're doing. Ask what you can do to help. Don't just send out a blanket email to customers either. You've probably got twenty of those in your in-box. Instead focus on your company mission and taking care of your customers.

Many of your employees will be facing dramatically different circumstances of working from home, dealing with family crises, worrying whether they will have jobs and so on. So give them flexibility in their working hours and the time to address family and personal needs.

Develop Contingency Plans

No one knows how long the lockdowns will last or what the longterm economic impact will be. But you must develop a set of contingency plans. What happens if we can no longer sell in Enterprise accounts? What happens if our customers stop renewing? What happens if we can no longer hire new people? 

Some scenarios that might have seemed extreme a week ago are now the de facto situation. The prudent thing to do is recognize that things will continue to change. Consider what signals will guide your decision making through the crisis. Watch carefully your sales funnel, what deals close and what gets pushed and who goes into production. Look for patterns that help you determine where to concentrate your efforts in marketing, sales, customer success.

Build a plan and then consider what if it gets even worse? And worse still? If you are selling to government, healthcare, financial services, logistics and tech companies, those segments may be ok. Retail, travel, hospitality, sports, manufacturing may be severely impacted. Non-essential businesses have been closed in many states and countries. What is your plan if that becomes nationwide? 

Many marginal businesses will be challenged during this crisis. If you've got less than 12 months runway in the bank and do not have clear product / market fit this is now an existential crisis. If the earlier dot com meltdown and 2008 recession are any indicator, VCs will be in triage mode and many will walk away from weaker companies. So don't expect a lot of guidance and certainly no further investment. Whatever goals you set with your board are probably out the window. Your most important goal may be as simple as: can we survive 2020? Figure out if there are one or two use cases or segments where you have some repeatability and focus your efforts. It may require a significant pivot to lower pricing, online sales, or specific narrow use cases.

Ideally you can cultivate an environment where everyone is generating ideas, whether these are ideas for cost reduction, or over time, ideas on how to innovate and identify new use cases. Sometimes the best, most creative thinking comes out of the constraints of a difficult situation.

Make Hard Decisions

Some of the healthiest companies I work with have two years of runway in the bank. And they are still being very cautious on spending, cutting discretionary marketing, putting a hiring freeze in place, putting expansion plans on hold. It may be hard to hit sales targets without the new hires you planned in January, but if things are even worse in June (and September) it will have been the prudent thing to do. 

Take Bold Action Sooner Than Later

Just as we wish our political leaders took more dramatic action earlier, do not fall prey to a "wait and see" attitude. Do not assume that your business will be ok. Yes, video conferencing and BI may be counter-cyclical. But it is better to be prepared for the worst than to be fatally optimistic. This is a good time to be very clear on the core mission of your business. Make sure teams are focused on what really matters, the small number of things that are essential to your business, not the "nice to haves." 

If you can afford to keep your team intact during this period, that is a great thing. People will remember that you took care of them and they will repay you with dedication, loyalty and hard work. 

But if you have less than 12 months of runway, you will need to reduce your burn rate and it is better to do so sooner and all at once rather than dribbling out a few cuts at a time. Cut spending to the point that it hurts. If you need to make a further reduction in headcount expense, consider a pay cut at the executive level before you eliminate jobs. There are no easy decisions here. But if you need to cut jobs, cut deeply all at once. The worst situation is you have a layoff, it's not deep enough and then some weeks or months later, you do it again. 

Do your best to provide some kind of safe landing (severance and recommendation) for any employees whose jobs you eliminate. Treat people with dignity and respect so that when it is time to rebuild they will want to come back to work for you. 

A crisis such as we have now is an opportunity for all managers to demonstrate real leadership. It is a time when people show their true colors, for good or for bad. It will be difficult, but become the leader that your company needs.

If you have other ideas or suggestions, please feel free to add comments below.

Update: And here are some excellent articles