Even Joe the Pipefitter must look askance at some of the moves made in corporate America when faced with a string of bad news.  (Sorry... I just can't use "Joe the Plumber", a guy who didn't pay his taxes, isn't certified as a plumber, and has tried to cash in on his 15 seconds of fame which - amazingly McGraw Hill has turned into a book while making great authors wait for a contract.) 

Mistake #1:  Become reactive and reactionary.

There is truth in the old saying "Respond in haste. Regret in sorrow." This is also known as the "ready, fire, aim" approach of leadership. When leaders fail to gather the information and critically assess the long-term impact of decisions, severe errors are made. Consider the Big Three auto executives who knee-jerked their way on private planes to ask for a handout without ever having a plan. Now that's a bonehead mistake.

First, stop any action and breathe. Think long-term strategy. Be cautious. Be proactive. Test out the decisions by saying, "If this... then this..." so you can try it on for size.

Mistake #2:  Huddle with only the corporate folks.

First, answers are often found at the floor level, not at the ceiling. Involve everyone in the search for efficiencies and innovations. Engage everyone in a common vision and mission.

Besides, if managers tell employees what to do, you've taken away all sense of responsibility and ownership. How refreshing to have the Obama team now posting discussions on the internet and seeking input from a variety of people with differing viewpoints. Building transparency goes a long way for building trust and making us all feel we are part of the solution.

Mistake #3: Cut. Cut. Cut.

No one EVER downsized their way to greatness. Wholesale termination of employees without thinking about the cost of underserved customers and too much work done by too few people or canceling the meeting without realizing that this is the time TO GATHER and candidly talk are just two examples of cuts that could have been done with a scalpel instead of a hacksaw. 

Substitute Jello for Jamoca Fudge and Two Buck Chuck for Dom Perignon but bring people together.

As for layoffs, if your organization or department can handle this-bring everyone together and spread out the facts. One very smart leader found that employees were willing to reduce work schedules, work half-time, and job share rather than have members of their team terminated. For more ideas, read Responsible Restructuring: Creative and Profitable Alternatives to Layoffs by Wayne Cascio, professor of management at the University of Colorado-Denver Business School.

Mistake #4: Go after new clients and customers.

Unless your current customers have vanished because of poor quality or service, these can be your best source of new revenue.  Ask how you can turn them into champions of what you provide. Make them feel special and valuable. I've noticed that my bank is now making every effort to thank me for my business, to call me by name, to answer any request with a "no problem" attitude. Sure, they should have been doing that all along but-better late than never. Besides, they've already got all my money in the safe. I think they'd like to keep it.

Mistake #5:  Do more with less.

We've been hearing this for years. In my consulting practice, I have often found that much of the "more" is work that provides no value at the end of the day. Scrutinize every process; get rid of the sacred cows and the egos. Translate every action into a dollar value. In one organization, we found that senior executives were tripping over each other to put their two cents into every PowerPoint presentation that was made. It was a waste of executive talent, made each project longer than necessary, disempowered the employee creating the presentation, and actually used up some $15,000 worth of senior management time!

BONUS Mistake:  Buy into pessimism.

It's a huge mistake we ALL make when we let the news of the day finds us hiding under the covers, chopping up the furniture for kindling and searching for recipes made with bread and water. 

What we have here is an opportunity to really consider what is most important, to spend time at work that is meaningful, and to nurture relationships that matter. We have an opportunity to reclaim our reputation, our integrity, and our future. Not to do this would be our biggest mistake.

To condense the wisdom of a Hopi Elder, "This is the Eleventh Hour...and we are the ones we've been waiting for."