Introduction to The New Edition of How to Manage in Times of Crisis

In 2008 there was a big financial crisis. I was invited to speak to IBS, the Institute of Business Studies, at the Russian Academy of Economics. My presentation was transcribed, and the result is the booklet How to Manage in Times of Crisis.

Years have passed since then, but the phenomenon that there is a financial and/or social and/or political crisis has not stopped. And each new crisis appears to be more complicated than the previous one. While 2008 was mostly an economic crisis, the emerging calamities are multi-dimensional. Social unrest, political left versus political right, religious confrontations, and unprecedented crime surges. All exist alongside unprecedented levels of innovation and technological advancements—impacting income and wealth distribution between those that are capable to handle change and benefit from it vs those that stymie.

These crises have become more acute because the rate of change is accelerating and impacting not just one subsystem, such as economics, but multiple subsystems at once. Social, religious, economic, and political subsystems are all being hit simultaneously, and the challenge of what to do is more demanding than ever before.

Many companies are going to fold. Many businesses are going to close. Yesterday I walked the main street in my town of Santa Barbara, California. Every third store on that main street was empty and for lease. Vacancy after vacancy. And what is growing? Food outlets: fast food, take-out food, sit-down restaurants, etc. A cultural change is happening. Habits are changing. Eating out, looking for an experience is in. Easiness of purchasing is passe. Technological change (the internet) has impacted social change (our daily behavior) which has impacted the economic sphere (companies that did not adapt folding).

Adapting to the changes requires changing the suite of products and services offered and much more. It might require who we are, how we operate, and what we believe in. And any of these changes can cause internal disintegration. If a marketing program changes faster than the sales effort can adapt, or faster than the people in the company can deliver what the new changes call for, disintegration will follow.

What to do?

Every organic system has a mechanism called homeostasis. This mechanism is a state of balance among all the body systems, and is needed for the body to survive and function correctly.

The role of sleeping is to enable homeostasis. During the day, the organs in our body activate and adapt at different speeds to what is happening. This is why, when we are under a lot of stress, we have a tendency to say, “I am falling apart.”

So, the system needs to pause and readjust. Reintegrate. Experiments done with animals that were subjected to sleep deprivation for a long time have shown that sleep deprivation causes premature death.

The body needs sleep. During deep sleep the body reintegrates itself. We wake up in the morning, after a good uninterrupted sleep, fresh to start the new day and fall apart all over again.

All animals sleep. Fauna and flora sleep. Anything alive sleeps or falls apart and dies.

And this applies to organizations, too. They are organic systems, too. They need to take a break from outward focusing—from looking at the market and doing endless strategic planning—and look inward at their internal systems, which must be periodically realigned to avoid a premature death.

And that is what this little pamphlet is about. And it is even more applicable today than it was in 2008.

You may find How to Manage in Times of Crisis on my publications website https://publications.adizes.com/products/how-to-manage-in-times-of-crisis-english.