Few CEOs navigated the Great Recession as skillfully as David Cote. In a new interview with Fortune, the inspiring corporate leader offers guidance for businesses managing the coronavirus crisis today.
When David Cote inherited Honeywell in 2002, the company was teetering on the brink of failure thanks to a mishandled merger with GE. Yet Cote was unfazed. During his 15 years as CEO, he not only navigated the Great Recession, but managed to increase the company’s capitalization to the tune of $100 billion dollars. Now the executive chairman of Vertiv Holdings, and the author of the upcoming Winning Now, Winning Later, Cote reveals the strategies that set Honeywell apart from irs competitors—and helped them emerge from crisis unscathed.
His first piece of advice focuses on leadership. “It’s surprising how often a leader will panic,” Cote tells Fortune. “A CEO who panics will just sit there, not knowing what to do, and try to build consensus.” But rather than striving for unanimity, Cote recommends hearing from your entire team and then making a decision yourself. “Independent thinking is a lot more rare than being smart.”
Cote also warns leaders against putting on their rose-colored glasses during times of crisis. Though they might not want to believe the worst-case scenarios, a lack of preparation will put them at risk of failure. “My credo is to hope for the best but plan for the worst. Pick a plan and start executing it as if you expect the worst to happen,” Cote advises.
This doesn’t necessarily mean cutting all costs, either. Cote says, “It’s also critical in turbulent times to keep investing for the future. Among the first things to get cut in a recession is usually investment in new products. But it’s those products that create a growing and vibrant company, and they need to be protected. Honeywell roared out of the Great Recession because we kept investing.”
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