Company transformation and turnaround usually falls into two main categories. Some companies are still profitable but their growth and profitability have stagnated or are starting to fall. Others have been making financial losses for some time and cannot seem to get out of their deteriorating position and are rapidly losing financial and operational strength. When the company or organisation is in the downward trend mode, proactive intervention must take place to re-juvenate, re-energise and re-build the business. The following are some of the measures that can be taken..
Management Insight #1: Management leadership drives a continuously successful and sustainable company.
Hence, it is important to always have the right leader in place to lead the organisation. Examples of great companies are seen in General Electric, Huawei, Google, etc. where they have a continuous history of great and visionary management leaders. These leaders always look into the future to build on past legacy. They, however, do not lead the company “driving into the future looking at the rear view mirror”. They scan the current reality and trends to be able to prepare and seize or create the future before anyone else. Hence, visionary leadership is key to organisation turnaround.
Management Insight #2: Highly successful companies have great insights and strategies.
As indicated by W. Chan Kim and Renee Mauborgne in their book, a successful company has great and innovative value creation and strategies. It is strategies and opportunistic insights that have allowed many great companies to continuously find market traction and loyalty. This competency in strategic planning, analysis and management is much needed in today’s fast growing companies. As identified in their research, it is not the company or industry that is the key attribute for the organisation’s success or growth but rather their innovative and dynamic strategy that makes the real difference.
Management Insight #3: Have a worst or failure case scenario on “how to destroy your company business” and contingency plan.
Even though your company may be enjoying success in its business, it is always good not to be smug and complacent but to have a management team workout on what and how you would destroy the company and its business. This discovery will help you identify your vulnerabilities, exposures and blind spots. While it is good to think of all the success, it is also good sometimes to think of what is the worst that can befall your organisation. There should be no superstition about this as the business world is now full of uncertainties, and good management leaders must be able to come to terms and deal with these unforeseen events competently.
Management Insight #4: Make sure that your company runs like a highly tuned performance car in all quarters.
All areas must be strengthened and no slack allowed. “Your organisation is as strong as the weakest link” in your organisation framework. Hence, whilst you may have a lot of champions who are highly talented and are high performers, the high performance of your champions are often stymied and reduced by the lowest and poor performance of your weak staff. Therefore, it is important that the company trains, develops and strengthens these weak performers, and if they are not able to meet the high standard of expected performance, then the management leader needs to take the appropriate actions to de-select these people. Otherwise, the talented ones will become frustrated and disillusioned and will leave as they can see the lack of management leadership.
Management Insight #5: Get the team fired up at all times and find and build great generals to work as partners and stakeholders.
Build a team of very committed people who run the business as if it was their own, and do make it their own if they are contributing to the growth of the business by making them equity partners or giving them profit sharing. The CEO management leader drives and epitomises the culture and dynamism of the company. He or she must exude the energy and enthusiasm which need to be maintained at all times. Management leaders have the accountability to turn on the lights when they come to work. Even though they are down and moody, they must metaphorically turn on the light to shine the way, otherwise everyone is in the dark and the motivation and energy will be down. Including the management leaders, every one in the company must play a part in managing the customers and stakeholders. All employees must therefore be trained to be business-minded and to behave like they own the company – as individual owners – and must conserve the company assets and always protect the company’s reputation and interests.
Management Insight #6: Never allow complacency to set in and the rot to start.
Always keep your people and business on their toes. And look at strategies for opportunities and profitable growth. Have a clear end in mind and a good strategic plan to guide your organisation’s direction. There needs to be a constancy of purpose and a sense of urgency, and this must be championed by the CEO for he is the one who makes or breaks the culture of the organisation.
Management Insight # 7: Form strategic collaboration and alliances to build strength.
Today’s business operating model is more of collaboration rather than a full-scale competitive model. As mentioned the customers are becoming more discerning and demanding and most suppliers now have to combine forces in order to meet the customers’ high expectations and demands. Hence, strategic collaboration and alliances would allow suppliers to combine their strengths and competencies to satisfy the customers and win their business.
Management Insight #8: Review constantly as if the company is failing.
Take a different look at your company and during your strategy session, instead of looking at how you can build your company, go through an exercise by asking your key managers what are the quickest and best ways to kill your company. You will be surprised by how many weaknesses and strengths you can uncover from doing such a reverse exercise. Develop a scenario of how the team sees the company in 1, 3 and 5 years’ time if you want to play in the long term.
