A recent article in McKinsey, which was based on a series of interviews with 14 CEOs and Chairmen of big companies like 3M, Tyco, Pepsi, P&G, and Sysco, described some emergent leadership lessons for hard times that was a good read. The harder times get, the more important good leadership is. Anyone can lead during a boom when consumers are spending freely and impulsively ... but it takes a special type of leader to lead when the sky is falling all around you.

While not a complete list of lessons that a leader needs to learn, the following five lessons that emerged from McKinsey's discussions are definitely critical.

• Confront Reality
  The sooner you accept reality, even if it is a drastically constricting market, the sooner you can start dealing with it. The first company to deal with it is often the winner.
• Put Strategy First
  Strategy should be the first item on the agenda of every board meeting ... and you should be taking advantage of everything your board members have to offer.
• Be Transparent
  At all levels. You will need the support and trust of your employees to make it through ... and that will require regular, open, communication. Openness builds respect, trust, and solidarity which in turn helps employees stay focussed.
• Build a Culture
  A culture binds a company together and helps to create trust.
• Keep the Faith
  Even a crisis has opportunities, and since the nature of markets is that they follow up and down cycles, things will eventually get better.

And whatever you do, avoid the axe. Use a scalpel if you must, but never the axe. Chopping off the arm when you only needed to remove a finger just doesn't make sense.

For a much deeper discussion, refer to the article. While a bit lengthy at 6 pages, it's definitely worth it.