Positive Leadership: Handling a Turnaround

When a company is in crisis— facing bankruptcy or a disruptive competitor— it needs to act fast. 

But it’s also important to stop and speak with the people who are doing the day-to-day work of moving the organisation in a new direction. 

Here’s how to use conversation to help orchestrate a successful turnaround:

Talk straight. Be honest and authentic, especially when it comes to sharing bad news or addressing difficult topics.

Make talk happen. Stressful times can cause people to keep to themselves. Promote interactivity and encourage debate. Forego one-way communication channels (like memos) and choose mediums that allow for back-and-forth discussion instead.

Let everyone talk. Include people at all levels in the conversation. This will increase engagement among those who must carry out the turnaround work.

Positive Leadership: Handling a Turnaround

Positive Leadership: Three Keys to Acquiring and Turning Around a Poorly Performing Business

Which distressed firms are worth trying to turn around?

Focus on those companies with an iconic brand name, one that people remember even if the company is down and out; a credible product, or at least the prospect of a credible product; and finally, talent or the prospect that a talented team can be hired. Talent is the key.

How do you motivate talent?

Down-and-out companies don’t have much money to spend. This means you have to build a team of people who are willing to work for the end game. You need people who have the passion, the perseverance and the courage to really walk in the darkness every day, one foot in front of the other, until they see the light.

How do you determine whether people stay?

If something is deeply distressed, the chances are there is some fault with the people on the ground. Sometimes it’s the culture, further crippled by an exogenous force. You never want to eradicate all history and prior knowledge, so at least give people a chance. But if they are not capable of self-reflection, if they can’t take any responsibility for where they are, they will never be the team to succeed. The one thing about this world is that truth is cold and hard, but it’s the first point on the path to hope and salvation: If you don’t want to hear the truth, then there is no future for you in the company.

Positive Leadership: Three Keys to Acquiring and Turning Around a Poorly Performing Business