Are you feeling the squeeze

Are you feeling the squeeze? With so many companies bracing for a recession, leaders find themselves under pressure to stop investing in organizational improvements. But we all know that acting rashly causes problems. Morale goes down, and when the economy improves, you've got to start over from scratch.

It amazes me how otherwise rational leaders will just start hacking away at an itty bitty leadership development or training budget with more attention than they devote to other operational expenses 20, 30, or 100 times higher.

Here are five ways you can intelligently s-t-r-e-t-c-h that development investment during a downturn, and avoid all of the problems caused by indiscriminate budget cuts:

1. First things first: get crystal clear about the competencies your organization needs in order to execute the business strategy. Let's say your organization is shifting from being a profit center to being a cost center in support of bigger business units. This is not an unusual scenario in a downturn, as leaders ask their organizations to line up around the biggest bets instead of experimenting with multiple, smaller, and unproven bets. There's probably a gap between your organization's current ability to collaborate cross-functionally and what is now needed, since they've been encouraged to work independently in the past.

Check to be sure that's true, and if it is, focus your organizational improvement efforts on enablers of cross-functional collaboration such as creating interlocking processes, establishing clear lines of accountability, and honing your leaders' ability to collaborate with other leaders.

Note how modest this line item can turn out to be, if you play it right. You may need a process redesign pro to help with the development of interlocking processes, an OD or HR consultant to help think through how to establish clear lines of accountability in a cross-functional environment, and an OD consultant to hone skills in collaborative leadership. You'll also probably need someone to handle internal communications about the change.