Despite the fact that the U.S. economy remains strong by many measures, business leaders are bracing for a recession. CEOs and boards from Wall Street to Main Street are reexamining – and in some cases refocusing – their priorities as they prepare for economic decline.

According to a Measure of CEO Confidence survey recently released by the Conference Board, CEO confidence is at its lowest point since the beginning of the pandemic. In fact, 68% of CEOs surveyed predict that “the Fed’s war on inflation will eventually trigger a recession.”

While a recession is not a foregone conclusion, leaders are proceeding with caution.

Precipitous drops in the stock market, rising interest rates, concerns over inflation, supply chain issues, the war in Ukraine and the persistence of COVID all point to a downturn, or at the very least a period of uncertainty.

Part of being prepared for possible economic decline involves carefully reviewing organizational priorities. The recently released Gartner CEO and Senior Business Executive Survey examined C-suite priorities for the remainder of 2022 and for 2023 and showed that many business leaders are not only reviewing their priorities but actually reprioritizing some key areas. While growth remains the top priority for the majority of top leaders, many in the study reported an increased focus on workforce issues and technology – strengthening “people, purpose, prices and productivity.”

I asked CEOs of local organizations that have prospered through various recessionary environments how they are rethinking or focusing their priorities as a possible recession looms:

Don Coffin, president and CEO, Bankers Trust: Bankers Trust has weathered several storms of economic uncertainty over 100-plus years. And our priority has always been the same — to help businesses and individuals navigate their finances and reach their goals with the help of talented employees. A recessionary environment makes it even more important to focus on customer experience, which is at the heart of all that we do. We don’t take on unnecessary risk or things outside our wheelhouse. This keeps us in a position of strength and stability to take care of customers and grow in our markets while maintaining a culture that retains top talent.

Angela L. Walker Franklin, president and CEO, Des Moines University: At Des Moines University, we anticipate challenges ahead and pride ourselves on being proactive and nimble, as we take a collaborative approach to planning. We have operated with a conservative fiscal policy that has served us well, being able to ride out market fluctuations with confidence. Our financial management approach has permitted us to continue to build our new campus, even in this challenging time. We will relocate in 2023 to a most transformative project that remains on schedule and on budget. We will “weather the storm” with optimism and resilience as our well-focused strategies remain unchanged.  

Mike McCoy, CEO, NCMIC: While our current NCMIC priorities remain unchanged, we are having different conversations in two categories. First, regarding customers in our finance business, based on the severity of a recession, some small businesses could find themselves in a challenging financial position. Not unlike the first year of COVID, are we prepared and ready to help them navigate? What preventive measures can we take? What education can we provide for our small business customers? Secondly, and from our perspective most importantly, is our employees. How might they or their families be impacted by a recession, and how can we get prepared and in front of recessionary challenges as a company? It’s important to have these conversations internally and purposefully to ensure we are appropriately prepared.

Mike Ralston, president, Iowa Association of Business and Industry (ABI): ABI’s priorities are established by its members. They are focused on workforce, advocacy, growth, financial performance and foundation programming. A recession – and I expect one is coming – won’t change our priorities, but may change our practices. For now, we aren’t planning big changes but may consider reducing expenditures, building our cash position, or other measures if necessary. Our organization recently hired two new staff members who will begin their work in July. That should allow us to provide greater value for members and lead to stable or even increased revenues.

Advice on preparing for a recession from CEOs of long-standing organizations:

Focus on the fundamentals. Planning for bad times requires prioritizing business fundamentals. Ralston says, “Our members are some of the state’s best-managed companies. They plan for negative situations when times are good so that they can weather storms that may arise.” As an organization that has withstood two global pandemics in its 119 years, ABI focuses on managing the balance sheet, tracking expenditures and cash flow, strengthening programs, growing revenue, and looking at staffing levels to withstand downturns. 

Learn from the pandemic: While NCMIC was founded 76 years ago in 1946, the last few years have provided many “ready-made lessons” for leaders, says McCoy. He points out that “the COVID experience taught us a lot about helping our doctors, customers and employees in some form of crisis.” He advises leaders to: “Dust off your COVID playbook and think through redeploying these learnings.” 

Do not overcorrect. Founded in 1898, DMU has managed over a century of up and down market cycles by staying the course on a long-term mission and strategy. Banker’s Trust’s Coffin tells leaders that the key is preparing for a downturn is to “not overreact and not overcorrect,” leadership advice honed from his formative years in the banking industry during the 1980s farm crisis, serving as a lender through the Great Recession of 2008, and leading the 100-plus-year-old bank through the pandemic. He advises, “Stay calm. Make slight adjustments. And give the changes time to take hold.”