Severe Acute Respiratory Syndrome--more commonly known as SARS--hit Southeast Asia in 2003, infecting more 8,000 people, killing nearly 800. Very quickly, 80 percent of business travel and tourism to Vietnam evaporated.
Our colleague Binh Nguyen was working at the time at the Duxton Hotel in Ho Chi Minh City. His boss, the hotel manager, faced some tough choices and spent a few days agonizing over what to do. Finally, he brought all of his employees together in the hotel's grand ballroom. "You all know about SARS and what it has done to our business," he said. "And you've seen other hotels in the city cutting jobs by 40 percent." Everyone nodded, prepared for the worst. Then he said, "I also understand that you still have your family to feed. I know what will happen if you don't have a job. So I have an idea." The manager then explained two options: The hotel could cut jobs by 40 percent...or everyone could take a 40 percent pay cut but no one would lose his or her job.
He allowed his employees to ask questions and discuss the options. Then he conducted a vote by secret ballot. Ninety-two percent of employees elected to reduce salaries so that everyone could stay--and fight together (under the leadership of a trusted manager) for their survival.
As one employee recalls, "From that day forward, things changed. Employees came to see each other as brothers and sisters. Before, there was a lot of fighting going on between different departments. But after the vote, everyone recognized that their fellow employees were protecting them and helping them keep their jobs."
That led to more than just camaraderie, however; it produced a sense of ownership and investment. Employees, who previously had just "punched the clock," for the first time started coming up with ideas for how to cut costs. For example, because occupancy was only 20 to 30 percent, one staff member came up with the idea to close down the top floors. They turned off all the lights, shut off the water, and assigned just one person for the upkeep of those floors. They also stopped printing out reports for managers, and used email and other means instead. All together, they saved a billion Vietnamese dong on electricity, water, paper, and other small things. As one employee recalls, "The more we worked together, the more money we saved, and the more our morale grew."
And then something even better happened. When the World Health Organization declared Vietnam SARS-free, tourism started picking up again. Guests poured in, and all of a sudden, every hotel in Ho Chi Minh City was up to full occupancy. For weeks, other hotels didn't have enough staff to meet guest demands and had to turn people away because they couldn't accommodate them. But at the Duxton, they had a full staff and could meet all their guests' needs. Other hotels had to go find new employees and then train them, which took at least three months time before they were fully up and running again.
When those other hotels came to Duxton employees offering them more money to go work elsewhere, not a single Duxton employee left. "Because we had trust," one of them explained to us. "We knew that if SARS or another crisis struck again, the other hotels would throw us into the streets. But we believed that even if we got paid a little less, we'd be safe at the Duxton. So we stayed. We all stayed." (Note: When business picked up, hotel management raised employees' salaries back to where they had been prior to the SARS epidemic.)
What the manager of the Duxton understood is that in tough times people need a place to channel their fear and uncertainty. He helped them channel it into activity--and in the process--tapped into their discretionary effort by uniting them around a common cause.
Why do meaningful activities lead to discretionary effort? As researcher Kelly Lambert explains, "Our brains are programmed to derive a deep sense of satisfaction and pleasure when our physical effort produces something tangible, visible and--this fact is extremely important--meaningful in gaining the resources necessary for survival" [the emphasis is ours]. She believes it's an evolutionary tool. "Our brains have been hardwired for this type of meaningful action since our ancestors were dressed in pelts," she said in an article in Scientific American Mind.
This explains why it's so important in response to an external crisis to give people a clear and credible call to action they can take specific action to support. It provides both an expectation and a means of reward.
Carlos Nieva, director of services for Alcatel-Lucent in Spain, understands: "Working for a multinational company, we recognize that they can put their operations anywhere. And so I tell our people, 'Let's give the organization a reason to keep the doors open tomorrow. We have to earn that.'"
Does that scare people? Maybe at first, Nieva says. But it connects people to a purpose. "It gives us a reason on a daily basis to bring all our brain power, all our ideas, all our enthusiasm--to bring everything to the table. Every day is a win--and everybody feels a part of that winning spirit."
He also adds an important reminder: The call to action needs to rally employees in response to an external threat. "I tell our people," he says, "'The enemy is outside. Never inside.'" The greater the perception is among employees that there are internal winners and losers, the lower your likelihood of building and sustaining real energy behind your call to action.
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About the Authors: Jeff Grimshaw and Tanya Mann are partners in management consulting firm MGStrategy. Jeff is the author of Leadership without Excuses: How to Create Accountability and High Performance (Instead of Just Talking About It) .