I recently read an article from the July 2009 issue of the McKinsey Quarterly called “Leadership lessons for hard times” (registration required) as part of their “managing in the new normal” series. The article is a collection of tips gathered from interviews with 14 CEOs of large (mostly multinational) companies. A few of the companies represented are Procter & Gamble, 3M, Travelers, Pepsi Bottling Group, AutoNation, and Macy’s.

As stated in the article, this is an interesting take on the current economic situation. Much has been written about the mistakes that have been made, about how we got to where we are now, etc. Little has been made of the learning from those mistakes or how to best lead an organization in less-than-rosy times. Here are the lessons:

Confront Reality Always question whether the “halo effect” of a business or business situation is blinding you to what lies on the horizon. —Herbert Henkel, chairman and CEO of Ingersoll Rand

At Board Meetings, Put Strategy Center Stage The board has been heavily involved in strategy formulation with me, and we have a better strategy because if it. —Bill Nuti, chairman and CEO of NCR

Be Transparent With Employees The only way to address uncertainty is to communicate and communicate. And when you think you’ve just about got to everybody, then communicate some more. —Terry Lundgren, chairman, president, and CEO of Macy’s

Be Transparent With Investors Our policy is: “If in doubt, communicate.” We always want to conduct our business with integrity and forthrightness. —Ron Sugar, chairman and CEO of Northrop Grumman

Build And Protect The Culture Stay focused on culture, people, and values: it’s the area most likely to get compromised in this environment. —Eric Foss, chairman and CEO of Pepsi Bottling Group

Keep Faith With The Future If you don’t invest in the future and don’t plan for the future, there won’t be one. —George Buckley, chairman, president, and CEO of 3M

While there is much to be learned from each of these lessons or principles, a subset of them resonated the most with me. First is the notion of transparency and communication. Especially in touch times (but at all times, really) there is ample opportunity for rumor and innuendo to take over. Communication (even over-communication) with stakeholders is critical to pushing forth an agenda and keeping the team with their eye firmly on the ball. Yes, it’s difficult to remain focused on the task at hand if I’m worried about losing my job. But communications from leadership of the organization about what’s going on can go a long way towards making me comfortable about the situation and about the folks who are leading the company through the challenging environment.

Another favorite is the confronting of reality. Addressing head-on the challenges of the day, whatever they may be, is not only more efficient but also more effective. I’ve been in corporate situations where the reality of the day (the forest) has been ignored (or perhaps set aside) while management focuses on something else (the trees) and the results have been more painful than needed. Especially in tough times, leaders need to take a good hard look at what’s in front of them and confront that reality however different, unexpected, or chaotic it may be. Only then can the organization truly begin charting its course through the situation.

Last is the point about the culture. In difficult economic times, it can be easy to throw out elements of company culture, reject company values, and lose sight of the people as you seek to swiftly control costs, for example. These short-term-focused actions, however, will have a profound effect on the company long term. A company is not just its balance sheet and income statement. In fact, a company is its people, the values that bind them together, and the culture in which they thrive. Short-changing that in difficult times will do much harm and impede the very recovery that management is trying to effect.