Step-Up Crisis Leadership Rule
Accept responsibility, decide under pressure, and protect those depending on you
- Difficulty
- Advanced
- Time to result
- ~ongoing to results
- Steps
- 6
- Confidence
- 96%
The Step-Up Crisis Leadership Rule begins by accepting that formal authority makes the problem yours, regardless of whether you expected or caused it. The leader identifies the people, assets, and institutional obligations at risk, then distinguishes hard deadlines from issues that can still be negotiated. Instead of wasting time asking why others have not taken charge, the leader creates options before the environment closes them off. Fleming’s Merrill Lynch experience also shows that urgency need not mean capitulation: even while securing a rapid sale, he defended the franchise’s employees, brand, businesses, and economic value. The output is a timely decision that protects essential stakeholders without abandoning sound judgment under pressure.
Origin
Greg Fleming derived this rule from helping lead Merrill Lynch through the 2008 financial crisis and its emergency sale to Bank of America.
Core principles
- 01Responsibility belongs to whoever currently holds authority
- 02Pressure is a call to act, not a reason to search for someone else
- 03Decisions should protect the people who depend on the institution
- 04Severe urgency does not erase the underlying value of an organization
How to run it
- 1
Own the Position
Accept that your authority makes you responsible for responding. Do not spend the available time wondering why the burden fell to you.
Pro tip State the decision and deadline in one sentence to eliminate ambiguity.
Watch out Searching for someone else to take charge can consume the last viable decision window.
- 2
Map the Stakes
List the people, obligations, assets, and institutional values endangered by the crisis. Use them to define what a responsible outcome must preserve.
Pro tip Include employees and long-term franchise value, not only the immediate financial metric.
Watch out Stress can narrow attention to the most visible threat while obscuring broader consequences.
- 3
Read the External Clock
Identify events that could sharply reduce your options, such as a market opening, regulatory action, or counterparty failure. Work backward from that deadline.
Pro tip Use weekends, closures, or other pauses as protected execution windows.
Watch out An internally convenient timeline may be irrelevant to the external crisis.
- 4
Create a Viable Path
Initiate the conversations, diligence, or contingency work needed to secure an executable option. Move quickly enough that the option exists before it is required.
Pro tip Prior relationships and preparation can compress execution time dramatically.
Watch out Do not confuse activity with progress; the path must be capable of closing.
- 5
Defend Fair Value
Negotiate from the real quality of the organization rather than from panic. Secure safety without presenting valuable assets as worthless.
Pro tip Name the enduring assets a counterparty will receive, including people, brand, capabilities, and ownership stakes.
Watch out Desperation communicated to a counterparty can destroy negotiating leverage.
- 6
Lead with Steadiness
Make the decision and communicate it in a way that gives dependents clarity. Treat later problems in proportion to the genuine crisis you have experienced.
Pro tip Use a calm definition of what constitutes a truly existential problem.
Watch out Performative confidence without an executable plan will quickly collapse.
In the wild
With Lehman Brothers nearing failure and markets due to reopen Monday, Fleming pushed for contact with Bank of America, helped launch accelerated diligence, and negotiated while considering 65,000 employees and a 95-year-old franchise. Although colleagues urged a sale at almost any price, he argued that Merrill Lynch’s wealth business, investment bank, brand, and BlackRock ownership still deserved fair value.
→ Merrill Lynch announced a sale to Bank of America before markets opened and obtained a price above its prior Friday close.
Common mistakes
Looking Around for a Rescuer
Leaders lose critical time when they focus on why nobody else has assumed responsibility. Authority means beginning the response immediately.
Treating Urgency as Worthlessness
A deadline may require a transaction without making the underlying organization valueless. Conceding everything can harm the people the leader is supposed to protect.
Ignoring the External Deadline
A plan that works on an internal timetable may fail when markets, regulators, or counterparties act first.
Is it for you?
Best for
It is best for executives and team leaders confronting urgent, consequential decisions with incomplete information.
Not ideal for
It is not ideal for routine decisions where deliberate consultation carries little downside.
From the transcript
“somebody is going to be in that position, So don't spend any time wondering where everybody is.”
“It's there and you need to react to it, and you need to rise to that occasion and try to do the right thing by…”
“I knew the value of a weekend”
From the episode
Greg Fleming on Shaping Wall Street (Podcast)
Greg Fleming