Planning for Leadership

Traditionally, business plans address factors such as market potential, advertising, finance, organizational structure, and other foundational issues that are essential for starting and maintaining a business. These are often the things that are easy to nail down, whether through data collection, or standard models, or just a simple decision about one option over another. But do they include specific plans for leadership?

If they don't, they should.

Leadership and human capital development are fuzzy topics, and it may be hard to decide early on how you want to address them. But as you look at how your firm will grow, you need to be thinking about how your leaders will grow, too. Whether you're looking at who's going to run your firm now, or who's going to run it 5 years from now, you need to be thinking about what kind of people you want to have doing that, and what skills they should possess.

I'll admit, I hadn't thought a lot about addressing leadership in your business plan until I saw something last week. A friend of mine in Singapore has a small graphic design company that, since he started it 3 years ago, hasn't quite worked out as he'd envisioned. During some talks we had last month while I was there, I sense he was at the point where a big breakthrough was about to move him forward. Things seemed to be coming together, he was gathering the motivation to kick it into gear, and I just hoped he'd carry through on the things we discussed.

Well, so far he is, and during the last 2 weeks he's shared with me his business plan that includes some of the new things happening now and that has some pretty specific plans for international expansion during the next 5 years. What intrigued me most was something he sent last week, which I've included below with some details changed:

2010 Singpore’s Management – CL
2010 US and Overall Management - JL
2011 Singapore’s Management – DY <-- CL Mentor
2011 Singapore and US Management – CL <-- JL Mentor
2011 New Zealand and Overall Management - JL
2012 Singapore management – FC <-- DY Mentor
2012 Singapore  and US Management – DY <-- CL Mentor
2012 Singapore, US and NZ Management – CL <-- JL Mentor
2012 UK and Overall Management – JL

Now, consider what he's done here:

- He's identified people to lead and manage now
- He's identified people to lead and manage later
- He's laid out the mentoring relationships to build the skills of future leaders
- He's accounted for his own continuing education and the education of others
- He's figured out who will lead the expanded effort before he expands

This is fantastic! What he's done is put leadership on the same level as everything else we consider important to a business. By paying attention to it now he's ensured that when he starts expanding he'll have the most important piece of the infrastructure -- the leadership -- in place. And he's got a plan for developing it, rather than just assuming it will be there.

He's already used this plan in one interesting way: he's talked to all these people about what he's doing, so now he'll actually do it...by telling them, he'll be accountable to them and they'll hold him to it, since he doesn't want to fail in front of them. That's pretty smart, because while we might be tempted sometimes to just give up, we're less likely to do it when someone's watching (a fact that occurred to me at about Mile 8 of a 10-mile race earlier this month...but that's a story for another time).

You can't just assume good leadership will exist for your business. You can't even assume YOU will be a good leader...you need to give it some thought, see what skills you need, and make sure you or the people you choose are ready. Give it as much consideration as you would give to any other piece of your business plan. Some things can be fixed if you get them wrong, but not having good leadership is a fast road to failure.

Give Them What They Need

I talked last week with a freelance photographer in Malaysia who specializes in travel photography. He’s done quite a bit of work for travel magazines, heading out mostly around Southeast Asia to provide a new perspective on familiar places, and he has a talent for helping you see a place as if for the first time, no matter how many times you might have been there.

But he hasn’t done any work for the magazine in months, nor does he expect to any time soon. The reason? The magazine drastically cut the funding for daily expenses on trips, to the point that he would have been paying for much of the trip out of his own pocket, wiping out a large percentage of what he would make from the assignment. He can’t afford to take a week away from other potential gigs in order to take one that won’t make him any money, no matter how much he’d enjoy it, so the magazine is losing out on his talents.

A travel magazine without money for travel? Come on.

When it comes to resources you need to be a smart manager, and among those smarts is a sense of priority. When your focus is on creative output then your first priority needs to be to get your Creatives what they need -- maybe not all that they want, but what they need -- to create. A graphic designer needs software. A hair stylist needs styling products. And a travel photographer needs travel funding.

Your Creatives bring talent. As a leader, it’s YOUR job to provide the resources they need to use that talent.

You’ll need to plan in advance with your Creatives so you understand your goals and they can figure out what they need to achieve them. If your salon plans to offer the Chi hair straightening technique from Japan, then you need to pay for that training; if you don’t see it as part of your offerings, then maybe you don’t shell out the $3000, or whatever it costs these days, simply because your stylist thinks it would be cool to learn. Figure out what’s necessary to meet your needs and focus your resources on that. As more resources are available, then you can do the lower priority things.

Try not to waste resources on unnecessary administrivia. If you’re throwing out a bunch of letterhead and ordering all new stuff simply because you’re changing the font at the top (and yes, I’ve worked in a place that did exactly that), you’re wasting money that could be better spent on your creative output. When you find yourself asking your Creatives "did you get the memo about the new format of the TPS reports?," you need to rethink your priorities. Put your resources into profit-making output rather than bureaucratic needs. That's not to say you don't spend money on in-house stuff that's necessary but not profit-making (like IT support, for instance) but it DOES mean you don't create unnecessary bureaucratic requirements.

Watch out as well for the "fun but not needed" stuff. Do you still emloy an in-house chefs, run a doggy day care, and provide massages on demand? This stuff is nice, and can create a better atmosphere for doing creative work, but in the current economic environment it might not be affordable...in any case, if you're scrimping on the stuff you really need in order to provide the stuff that makes things nicer, your priorities are out of whack. Some places can get away with this; Google is famous for it. But if you had Google's revenues, you could do it too. If you don't, well, then, you may need to focus your resources more sensibly. It's important to create a good working environment, but not at the expense of your true goals.

A travel magazine that doesn't have money for travel is headed out of business, or at least will find itself becoming a mediocre enterprise that doesn't stand out on a crowded newsstand. Your Creatives need resources to do what they do, and you need to find a way to get them. Maybe they need a lot, maybe they only need a little, but you need to know what they need and get it into their hands.

Design and Innovation Go Hand in Hand

In modern times, as good design becomes more easily available to so many people, we are seeing a proliferation of design as a key element of products, not a "nice to have" idea but instead a "must have." As production costs drop with more and more production being accomplished in low income places it's possible for more producers to enter the marketplace, and so they need to somehow differentiate themselves from the competition. They can do this through product quality, or price, but in many cases they choose to do it through good design.

Design has always been there, of course, but in many cases it has been an afterthought, and even though we think of Creatives as a subset of innovation, those Creatives involved in design have often played a role only at the end of the process. Innovators come up with a new product, designers create eye-catching packaging. Innovators create a dependable product, designers add the bells and whistles. This might have been OK when consumers were wowed by "the newest thing," but when "the newest thing" comes out every couple of weeks, the design element is critical for keeping products front and center in people's minds. They've come to expect it, and if you fail to deliver, they'll fail to buy your stuff.

The trick, then, is to bring design and innovation together throughout the entire creation process. While engineers are coming up with new ideas, designers should be part of that team. A product needs to be practical in order to be profitable, and designers can help with that. Don't worry that this will narrow the possibilities for your innovators and restrict your work; instead, it's likely to make things better because they'll have people working with them who can help them see options early in the innovation process and give them ideas of how things could work, rather than getting to the end of the process and realizing something is impractical. And having the innovators there when the design is being created will prevent your designers from coming up with an idea that degrades the performance of the product. Creating good products quickly (the operative words being "good" and "quickly") demands cooperation between innovators and designers at all stages.

If you're a production firm with both designers and innovators, and you lead one or the other, then your goal should be to integrate them when it comes to the actual innovation and design processes. Don't try to merge two divisions into one big one; your innovators and designers have different requirements, career paths, and maybe even personalities. Manage them separately but try leading them together.

If your firm does only innovation and you contract out for design help, then you need to bring that outside firm into the process early on. Over time you need to build a trusting relationship with a design firm, someone who can be there when ideas are being batted around without you worrying that your intellectual property will escape and you'll be beaten by someone else.

If you're a design firm, then arrange your contracts with your innovating clients so that you're part of the process throughout its entirety. You may have to adjust your internal hiring practices, perhaps bringing in an engineer who can translate "geek speak" into something designers can understand.

Sequential product development is a thing of the past, at least, for successful firms it is. Organizational stovepipes might have some usefulness, such as in setting your hiring goals and requirements and such, but when it comes to the actual work you need to break down walls and bring necessary skills together. Innovation and design complement each other and there's no point in keeping them separate. Unless, of course, you want to fail.

Don't Be Surprised

Things happen that catch you off guard, and you can't always control that. Too often, though, you can, you just don't.

Very often we get signs that something is happening or a trend is developing, but rather than looking into how it can affect us, we ignore it. It's kind of like getting sick but refusing to go to the doctor...often, by the time you do, the problem is a lot worse than if you'd just dealt with it up front.

Why do we often ignore emerging problems or opportunities? A common answer is "I'm too busy dealing with reality to deal with 'maybes.' "The logic goes that you can't deal with every possibility, so it's easy to justify not addressing something.

But does "dealing with maybes" really take all that much effort? If you know a change is coming in your firm, in your market, or in your field, how much effort does it take to sit down with a few people and ask "what's the effect on us if this happens?" You may determine the effect is minimal, and not worry about it anymore. You might decide that it could affect you, but the response to that is out of your control. Or, you might figure out that there's something you can do to counter the effect, and maybe even keep a problem from occurring or encourage an opportunity to emerge.

That's the thing to do: think about what you can do, and then if it's feasible, do it. Perhaps you can keep a problem from popping up, shaping your environment rather than responding to it after the fact. If not, then maybe you can figure out how you'd respond to something if it happens, and then take whatever steps you can to mitigate potential bad effects or take advantage of opportunities. Sure, if you prefer, you can just sit around and ignore it, but if it happens -- whether good or bad -- you're going to have to respond to it anyway, so why not exercise some control over your response?

In creative fields your job is develop new things, so "change" should not be unique, and both problems and opportunities should be expected. Unlike workers in more static industries, your Creatives are creating change from within (if they're any good, that is). There are also plenty of changes that can come from the outside, which everyone faces. A friend of mine works in a fairly new division of a company, and a new executive is about to come in above them. "What if he decides to just get rid of our division? What then?," she asked her supervisor, who didn't have an answer. That's a pretty serious threat, so they need to be thinking about 1) how to keep that from happening, and 2) what they're going to do with everybody if it does,

Far too often we're surprised by things that shouldn't be surprises at all. We just need to get our heads out of the sand, or wherever we've stuck them, and take a good, realistic look at the world around us.

Contingency Planning

Strategic planning is important whether your creative enterprise is large or small. If you do it right it will help you ask the right questions about what you really want your firm to do, how big it should be and what talents you require, how your resources should be spent and how much you need, and basically, how to get from where you are now to where you want to be.

Some people avoid planning because, they say, nothing ever goes according to plan anyway. And honestly, they're right. Baron von Moltke wrote about military planning in the 19th century that "no plan survives contact with the enemy," and there's a lot of truth to that. Once you have a bunch of unknowns entering into your equations, all the known vaiables in your plan suddenly seem less important.

You can try to account for this in your strategic planning by trying to address as many variables as you can, but there's a limit to what you can do before your plan gets too big to be manageable. You can also try to make your strategic plan flexible, but it's possible to get so flexible that it doesn't provide clear guidance anymore. Your other option is contingency planning.

In contingency planning, you identify some of the more likely scenarios you might face, and develop an idea how you would deal with them. It doesn't have to be intricately detailed -- you might want more detail for the more likely possibilities, but for the less likely ones you might just come up with the basic idea and fill in the blanks if it actually happens. It all depends on how much time you want to devote to this. Once you have your plans, put them on the shelf until you need them. A review every now and then would be helpful, but don't obsess over it.

You can't think of every possible situation, of course, and you shouldn't try. Contingency planning is particularly useful for addressing short-term problems that can have long-term consequences. It gives you a starting point for your response, rather than trying to come up with ideas in the midst of a problem. If you're trying to deal with the immediate aftermath of a problem it's hard to focus on permanent solutions to the underlying problem, so give yourself something to start with.

What are some situations you might think about? Well, how about if a major client suddenly cancels a contract? Or you lose a critical employee? How about serious IT problems? These are the kinds of things that can happen with no warning but can have a serious impact on your work in the short-term and your firm's survival in the long-term. Think about what's important to your business and about how you'd respond if something happened to it.

As with strategic planning, the contingency planning process is very useful, especially when it helps identify what's most important to your firm. You might even realize that, rather than worrying about contingency plans, you actually have to take some steps in your day-to-day work to address vulnerabilities.

Realize too that contingency planning doesn't have to just be about problems. You might consider certain opportunities that could come your way and ask how you'd take advantage of that. What would you do if you had more money? What will you do if a client extends a contract for another three years? Opportunities only matter if you capitalize on them.

With a collection of Creatives working for you, you're at an advantage. If you are looking for potential scenarios and the means for dealing with them, you benefit from having a group of creative thinkers helping you. they may not be doing the actual planning but you should definitely take advantage of their inputs.

Lots of people may turn their nose up at contingency planning, thinking it's a lot of time spent on something that may never happen. Then again, we spend a lot of money on insurance against events we also hope never happen. Is there really any difference?

A Recession is Still a Time to Innovate

Tim Brown wrote last month that

"There is an Eskimo proverb that says the storm is the time to fish. We are in the middle of a pretty big storm at the moment and organizations are asking questions about how committed they should be to innovation"

The answer to that question is: VERY committed, as some of the comments on his blog suggested. I'd like to add my own folksy quote to the mix:

"I never did fix that hole in my roof. When it's raining, I can't get up there to fix it. When it's not raining, it doesn't leak, so what's the point?"

I'm pretty sure it was my grandfather who said that. Or someone's grandfather, anyway. Chances are it was a grandfather.

The point to take from that is that maybe you SHOULD fix the leak, but the process for doing that will be different in different circumstances. When it's not raining you've got the luxury of time, so you can focus more on the most efficient way to do it, and get the best results. When it IS raining, you're going to need to rig up a tarp or something to work under, and your focus will be on speed rather than the highest quality. If you add those two quotes together, what you get is that it's raining now, and it's time to stick a fish in the hole in the roof. Or something like that.

A recession provides you an opportunity to innovate, for a couple reasons. First, if the workload has dropped, you have time now to try some new things, some ideas you wouldn't have gone with before because the "tried and true" methods were faster and you needed to meet client deadlines. But if the workload is down, then rather than letting employees go you should make use of this time and invest in the future by changing your innovation process and taking advantage of the extra time. You should look at your end product as well: if you're hoping to sell during the recession then you need to develop ideas that will be affordable and practical in a downturn, but if you're saving your ideas for the post-recession upswing, then you can design toward the high end market.

The latter idea requires some confidence on your part that you can hold out during the recession and still be in business when things turn up again. To do that, you're going to need to keep the cashflow going. that leads back to the former idea -- design suitable for a recessionary environment -- which was addressed by Bruce Nussbaum in a blog entry last month. He cites, for example, Amazon's Kindle, which is a well-designed device that's priced appropriately for the recession. Many of your competitors may be laying low until things calm down, so this is your chance to increase your market share by keeping products out there.

So, you should first consider your design objectives: long term or short term? With that in mind, you then need to figure out a design process that takes advantages of the opportunities you have now, meets the challenges, and satisfies your goals. then, look at the product you're aiming for, and make sure it's appropriate for the conditions in which you expect to sell it.

Many firms will go under in this economic downturn. Yours doesn't need to be one of them. With some good planning, a willingness to adapt your innovation process, and an eye on an appropriate product, you can come out of this stronger than before.

Why Are You Doing This?

It's very exciting to start a new project. Maybe you hear about something, or maybe an idea comes to you out of nowhere. It's a great feeling, isn't it? You get all excited, you discuss it with others, you start making plans or finding the resources to do it. Maybe you look for partnerships outside your organization, or you build a team to run with it from inside your firm. You present the idea formally and look for support from your peers and leadership.

And then someone finally asks the question: why are you doing this?

And you don't have an answer.

Well, maybe you have an answer, but it's not a good one. Like saying "because we can," which isn't really a reason for doing things, especially when you're investing time and resources that could be spent on other things.

I saw this happen recently with a colleague from my division, which does strategic planning for a large bureaucratic organization. For the last 3 months he's been running around with an idea for using Web 2.0 concepts in connection with our work, but he's never really been able to explain why. The ultimate purpose of the idea has changed...it started out in support of our primary analytical function but at times it seems to be a strategic communication tool. He can't describe the final form he envisions for it and so he can't explain how to get from here to there because he doesn't know where "there" is. When asked what problems this solves he says "several," but of course the question wasn't "how many?" Unfortunately, he just keeps tossing around sound bites and rhetoric and because he sounds like he knows what he's talking about (and his audience clearly doesn't) and he has a PhD, a lot of people haven't forced him to provide answers. But in a big meeting this week he gave a presentation and was asked "what impact will this have on other divisions?" He couldn't answer, because since he didn't know what this thing would be used for, he didn't know how others would have to contribute.

That's unfortunate, because if he DID have to provide answers earlier, he might actually take this germ of an idea and develop it into something that fixes a problem or otherwise addresses something we could be doing better. As it is, he's gone far down this path, and now that questions are starting to be asked, he's liable to see the whole thing derailed because people are asking "what, exactly, have you spent the last 3 months doing?"

The bottom line is, new ideas should either be solving problems or otherwise improving necessary capabilities. So your employees would be best off by understanding your needs and thinking of ways to solve them. The second-best solution is, when you come up with a really cool idea, look carefully at your business and find something it supports...be able to explain why you're doing this.

The Creatives working for you are, in fact, being paid to be creative. That's why you have them, right? So you're liable to face this problem yourself, and you need to figure out how to keep people focused on your organization's needs without making them feel like they're being boxed in and shouldn't be coming up with new ideas. The trick, I think, is to ask questions like "what problems will this solve?," or "what form do you see this taking?," in such a way that you're seen as trying to develop the idea, not kill it. Don't pose it as a challenge, but instead use questions like this to guide a discussion and help them explain things that maybe the feel but haven't put into words yet. In this way you can come up with some really creative solutions to your problems. And if they're smart, and they see that what they're coming up with sounds cool but has no applicability, they'll pull the plug themselves.

Of course, you're likely dealing with some ego issues here and some pride of authorship, so you need to be careful. Some people, like my colleague, see any question like this as a challenge and they take it personally. But changing that kind of mindset is a discussion for another time.

Creative Opportunities in a Troubled Economy

Grim economic news makes business leaders nervous, and rightfully so. The tightening of the credit market makes it tough for businesses to get the resources they need to conduct their day-to-day operations. Customers are liable to cut back on their spending, hurting your bottom line. Your employees are likely to be nervous about their homes, their bills, and their jobs, and may not put as much focus onto their work as before.

You're going to need for change how you do business. Smart leaders will reposition their firms by identifying their customers' new needs and being ready to meet them, while using any "downtime" as an opportunity rather than as a waste. You can keep yourself going in the short-term, and set yourself up for the long-term, if you take some steps now. The discussion below isn't meant to be a comprehensive list, but merely a demonstration of some ideas for navigating the months ahead. Some of these steps may be challenging, but if there's no challenge, then where's the fun?

Advertising Advertising firms large and small need to understand how their clients' needs are changing, which can be tricky, since very often the clients don't even understand those changes. New campaigns may need to emphasize value over performance. Graduated campaigns that start with brand-awareness and evolve slowly may need to be sped up, and producers might need to focus on existing products for now while waiting to introduce new products when customers have more disposable income to try new things. Copywriters and artists need to find better ways to sell to customers with less to spend, and ad firms that can do this will be successful.

Fashion Everybody needs clothes, but not everybody needs new clothes. Designers need to look at creating new looks that are not only stylish but that can also be produced and sold for less. Whether this means changes in material or less accessorizing, the need exists for less expensive clothing lines. People will be buying less in the near future and high-end clothing may well be viewed as a luxury item that needs to be put on hold for now, so an emphasis on practical business wear may make better business sense than couture. People will still be buying clothes, but whether or not they buy yours is up to you as much as it's up to them.

Interior Design Ever wonder why Design on a Dime is such a popular show? People want their places to look great but aren't always interested in paying a lot of money for that. During a recession that's just going be more true, so consider changing your approach to something more affordable. If your style leans toward high-end furnishings, you might want to lean it another way temporarily. This isn't to say you should undercut your artistic sensibility, but instead that you should focus on the overall look more than usual and de-emphasize the characteristics of the pieces involved. Homeowners and businesses will still be looking for nicely designed spaces, but they'll also be looking to spend less. If you can meet that requirement, then you can be designing for them. If not, then not.

Hairstyling Getting your hair done is very "income elastic," meaning that changes in income have a strong impact on a customer's demand for a service. If you're at a salon you'll probably see clients going longer between cuts and colors, and there's little you can do about that beyond lowering your prices...and even that won't help much, since demand for your services is based so strongly on income, not just price. Your stylists will likely have a little more free time on their hands, and new clients might be hard to generate in tough times. You might take this opportunity to invest some more in your stylists and get them some training so they'll be even better and can offer more services when things turn up again. You could also get them involved in volunteer work: offering free cuts for a battered women's shelter, for instance, does something nice for people who need it and also gives your stylists more practice instead of sitting around, or maybe you could hold a "cut-a-thin," which not only raises money for a worthy cause but also raises awareness of your salon for the future. Don't let "dead time" be wasted time.

Entertainment The entertainment industry, whether national or local, can benefit from economic downturns. During the Great Depression people used to enjoy going to the movies because the fancy lives on the screen were a welcome escape from their own hard lives. These days, movies and other entertainment like professional sports or Broadway shows, tend to be a little more expensive, so you probably won't see a big upsurge in attendance any time soon. Free entertainment like television will become even more appealing, so writers and directors might take this chance to try new things and experiment with their creativity, since more folks are liable to be staying in rather than going out as much, and might be up for something new. Local theater groups and other relatively low-cost entertainment could also see an upsurge in attendance since other higher-cost venues and travel to exotic locales might not be on as many people's agendas as before.

There are some economic potholes up ahead but if you play it right and aren't afraid to change how you do business, you can keep your firm going now and position yourself to do even better in the future, especially if some of your competition doesn't adapt and subsequently goes out of business. You have a couple of things going for you. First, in creative fields, you can be less tied to traditional ways of doing business than someone in, say, accounting. And you have a great advantage: the creativity of your employees who, if you turn them loose on your problems, can find far more solutions than the few examples suggested here. As your business environment changes you need to change with it, and if you're a good leader, you and your Creatives can find some great opportunities in the cloudy days ahead.

Weathering a Downturn

The news is filled with the current crisis in the US economy, which of course has a spillover effect to other countries. So far, the firms going bankrupt, being bought out, or being taken over by the government are in the financial services industry, so Creatives may feel safe for the moment. After all, the people losing their jobs are investment bankers and other Wall Street folks, right? Overall unemployment is still fairly low in the US, under 6%, so many leaders and employees may feel like it sucks to be "the other guy," but it's good to be Creatives.

For the moment, that's true, but depending on how this crisis develops, we could see a very negative impact across all industries, and Creatives are likely to feel that punch to the gut just like everyone else. It's kind of like the trickle-down concept that was at the center of Reaganomics. They forgot to remind us, though, that just as the benefits of a strong economy are supposed to trickle down to everyone, so too does the pain in bad times.

How are Creatives likely to get hit? Well, as financial firms have faced problems and lost confidence in the system, they have cut back on loaning money. This reduction in credit makes it difficult for many firms to operate. Now, you may be a small firm that isn't relying on credit for your daily operations, and you may not feel like expanding right now so the inability to get a loan may not be a problem...but what about your customers?

The people who are paying for your services may not need them or feel they can afford them. As companies feel bad times coming and face the need to scale back, they are liable to reduce the services they purchase from you. They may put off that upgrade to their IT systems, they might cut back on their advertising budget...if you provide services to corporate clients, you're liable to see demand drop off during the next year or two. Creative services for individual clients are likely to be hurt as well. As unemployment rises the demand for things like interior design will drop off, customers' ability to pay for high-end hairstyling will be reduced...basically, your workload is likely to decrease. As a leader, this is where you'll need to decide what to do with your workforce in a time of reduced demand. The smart leaders, of course, will think about this in advance.

I'm going to suggest to you that, in creative fields, leaders need to do what they can to keep their workforce together during the trying times to come. Even if demand for your creative services diminishes, you want to try to keep your employees together, so long as doing so doesn't drive you out of business. (of course, this might be a good opportunity to get rid of bad employees)

Why should you keep workers even if your revenues are down and your workload has dropped? Because economies go in cycles, so even though we're in a downturn now, we'll be back up again at some point, and though demand for your services may fall off, it'll pick up again. When it does, you want to be ready.

The financial firms can cut people loose (and in some cases, they have no choice). Bureaucratic employees, who do a job that can be learned fairly easily...hey, if they have to leave, they can be replaced later. But when it comes to Creatives, you're better off holding onto what you've got. In terms of people who work individually, you have (hopefully) chosen employees that have the skills you want and the talent that meets your requirements. If they're able to do the things you need done then you're going to want someone with those skills when conditions improve, and in creative fields, you may have to look long and hard to find the right talent in the future. Better to keep the individuals you know have the right sense for what you want your firm to do. And hey, if you've got teams that work well together, the last thing you want is to split them up. Getting that kind of synergy in the future might not be as easy as you think. If replacing individuals is hard, replacing teams is ten times worse. It's all about planning for the future...if you've done your job well and have a good group of employees now, why would you want to lose that and have to start over again in the future (when other companies are also restarting their efforts, and competing with you for talent)?

Also, while losing continuity and corporate knowledge is hard any any firm, it's particularly hard when it comes to Creatives. For many Creatives their particular skills are in a constant state of growth and development, and derailing that process hurts them as well as you in the future. Many of your projects might also benefit from continuity, particular things like ad campaigns, software development, or video game design, where there's a continuing evolution from one version to the next.

But how do you keep your workers in a time of reduced demand for your services? How do you keep paying them without going out of business? How do you keep Creatives engaged rather than bored? Frankly, it will take some flexibility on both sides. For your employees, they may have to take a pay cut, or at least forgo raises until things get better. They might have to take a cut in hours or a reduction in benefits. There's likely to be some pain there, but as long as it's manageable, it's probably better than unemployment. From your perspective, you may end up paying them more per project than you were before even if the total payroll ends up being the same or less. Consider allowing them to do volunteer work or pro bono projects on company time, so they have something to help keep their skills current. Maybe let them take classes on company time so they're even more talented when demand picks up again. If they're having trouble making ends meet, consider letting them do some contract work of their own using company resources.

If you DO have to let people go, help them out. Try to give them a decent severance package, let them use company resources to look for new employment, and do what you can to help them find a job. It's just the right thing to do.

What will you get from this? Ultimately, you're investing for the future. As the economy turns up again you'll be in a position to provide better services to your clients because you've kept your skilled employees rather than trying to restart with a new crew. When firms and individuals are looking for creative services again, you're more likely to snap them up as clients.

Perhaps more important than the external relationships are the internal ones you'll maintain and develop by keeping your Creatives employed during tough times. By demonstrating loyalty to your employees now you'll be building their loyalty to you, and when the time comes that firms are hiring they'll be more likely to stay with you. And as you take care of your people you'll be improving your reputation among Creatives, which is going to help you attract the best employees in the future when the time comes to expand. This is one reason that trying to help folks even if you have to let them go will pay off for you in the future.

The gloom and doom being broadcast to the nation doesn't have to lead to disaster for you and your Creatives. Hunker down and ride it out. If you plan now for potential trouble, you can emerge as a stronger, more talented, and more profitable firm in the end.