How Leaders Can Help Their Organizations Survive a Recession

September 8, 2022

recession proof sign

Overview: To recession-proof organizations, leaders must keep tabs on the health of their businesses and equip employees with the skills they need to respond to crises. Open communication is a key element of crisis leadership. Change management and accountability are two more puzzle pieces that allow businesses to weather recessions.

“I’ve heard there’s going to be a recession. I’ve decided not to participate. ”- Walt Disney. 

Recessions aren’t fun, and while they seem to come around regularly, we’re never ready for them. The good news is as an intelligent business leader, you can decide not to participate in the next recession by recession-proofing your organization. How can you accomplish that?

Recession-Proofing Your Organization

Making an organization recession resistant is a worthwhile job for any intelligent leader. Recessions are scenarios that test the skills you’ve acquired through leadership training. Although trying and costly, they may be your time to shine as a self-aware, emotionally intelligent leader.

Recession-proofing involves healthy business management techniques and outstanding people skills that put your intelligent leadership mettle to the test.

Being Aware of the Health of Your Business

Knowing where your business stands from a recession-proofing perspective is the equivalent of establishing a baseline for your efforts.

Leadership coaching starts with setting a similar baseline that describes your leadership traits, tendencies, and abilities. Your coach needs this information to determine the best course for your improvement and approach to coaching.

As a business leader, you must understand the health of your organization from at least three angles.

  • Production. How is your organization handling its products or services? Are there any inefficiencies you could weed out?
  • Talent. Does your organization have an adequate pool of talent? Can you afford new hires? Can you maintain what you have? How far can you stretch your available talent?
  • Resources. What do you need to maintain your current output levels? Can you afford to do it during a recession?

Once you have an accurate picture of the health of your organization, you can proceed to equip leaders and employees with the skills they need to help your business avoid a potential recession.

Focusing on Your Employees and Managers

Leadership coaching can yield results in times of stress. It works best when you can dedicate your undivided focus to it. The same is true of employee and manager training. When a recession strikes, your organization won’t be in ideal shape to begin training employees and managers.

The answer to this problem lies in company culture. Executive coaching urges leaders to establish a psychologically safe culture of coaching within an organization. With everyone coaching everyone else, people find it easier to learn new skills and implement change.

Here are some other elements that can help you create a healthy company culture and employees ready to take on the challenges of a recession.

Encouraging Open Dialogue and Communication

Intelligent leaders encourage open communication. Employees should challenge taboos and ingrained thinking on every level. When no sacred cows pose any hurdles to communication, organizations find it easier to recognize impending challenges and devise effective responses.

Embracing Change

Intelligent leaders are perpetual advocates and ambassadors of change. The ability to handle change should be one permeating an entire organization. Recessions always entail disruptive change for organizations on some level. Budgets may dwindle, production suffers, and teams undergo reorganization. Flexible employees may find it easier to shed outdated habits and embrace methods that can help their organizations avoid recession.

dark winter versus bright summer
Recessions accelerate change.

Recessions accelerate change. 

Doing More with Less

Crises require creative solutions. Employees and managers have to do more with the resources they have to overcome adversity. Leaders may have to cut staff, lower prices, and reduce purchases.


Executive coaching understands the relationship between accountability and progress. Under stress, accountability may suffer and give way to a sort of thieves’ agreement of “I won’t keep tabs on you if you don’t keep tabs on me.” Such failures in accountability sabotage the ability of organizations to navigate recessions.

In times of crisis, leaders must hold organizations together by communicating honestly and frequently, keeping people accountable and aligned, and motivating employees to do more with less.

Contact us to learn more about how you can join the IL Movement as a coach or how you can benefit from partnering with us to bring IL Solutions to you and your organization.

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