As noted previously in The 4 types of organizations – What stage is your Organizational Leadership in?, turnaround organizations are at a decision point…if you go one way, you fail; if you go the other way, you have the opportunity to succeed.
Employees, members, and stakeholders within your organization are demoralized. The processes and best practices may be out of date…the leadership may be be alienating people (or may just lack the skills to lead the changes necessary). Failing to turnaround an organization could result in lost jobs, organizations failing completely, or in worst case scenarios, it could result in people loosing their lives.
Turnaround or die is strong statement… Refineries have a process called a turnaround where they shut down portions of their industrial plants to redo/upgrade portions of the facilities and to inspect/test the facilities. If the refineries or plants don’t make changes, people lose their jobs (Detroit) or people loose their lives (google BP Explosion for examples).
Michael Watkins indicates in The First 90 Days that these organizations need people who “move fast and take chances.” They need individuals who can do rapid diagnosis of business situations (markets, technologies, products, strategies) and who can then make aggressive moves to cut back the organization to a defensible core. Decisions are often based on incomplete information.
How do I know this?
I’ve had the opportunity to work with multiple groups over the years that were either in a turnaround situation (or were denying the fact that they needed one!)
After assessing your situation, three quick tips for a turnaround organization:
1. Create a Vision
When demoralized, your people are looking for hope. Create a vision that coalesces a common purpose. Enlist those around you and incorporate their vision and energy. Enable others to act.
Sound familiar? I highly recommend reading The Leadership Challenge by Kouzes & Posner. The leadership within an organization needs to have a clear vision that is communicated with the rest of the organization. This gets everybody moving in the same direction. When in doubt, employees will act upon what they think is the vision. This is like a ship without a captain at the helm. You’ll end up somewhere, but not necessarily where you wanted to go. A clear vision is imperative so that everybody knows where to focus their energies.
2. Make a Decision
Waffling is not an option (unless you like your current condition, you may like the status quo). It is easy to be stuck, but action is imperative. Making decisions gets momentum going. This is the business version of Newton’s first law of inertia.
An object at rest will remain at rest unless acted on by an unbalanced force. An object in motion continues in motion with the same speed and in the same direction unless acted upon by an unbalanced force.
This is a lot like bumping a beach ball around with friends. When your organization was a startup, the energy was high and the ball was sailing from person to person. For whatever reason, someone dropped the ball. Maybe they were looking elsewhere, maybe they didn’t have the skill to bump the ball, maybe they were trying to micromanage how the game was being played, maybe they just didn’t care about the game. The result is that you lost the momentum. Somebody has to decide the game is still worth play (with maybe some revisions to the the rules), pick the ball back up, decide who to bump it to, and set the ball in motion again.
3. Fail, and Fail Fast
This reminds me a bit of the repositioning the American Institute of Architects is going through right now. While in a board meeting a month ago, one architect said “let’s wait and see what the other chapters do.” As Daniel Burrus notes , this mentality used to be equal to “playing it safe.” Today, we are talking about managing our risks and moving forward through periods of transition and transformation.
This also entails creating a safe environment for people to fail. Things don’t always work out as planned, but again, we want to keep the momentum from item #2 moving.
A turnaround is not a bad thing. It is a part of the transformation process. This is an opportunity for new ideas and new directions.