Even You Cant Revive A Dead Company

Dec. 21, 2004

No executive challenge is more demanding, more nerve-racking, more heart-wrenching, more difficult, more frustrating, or more stressful than trying to turn a winner-turned-loser into a winner again. Turnarounds are stubborn creatures. They resist change, the usual medicine prescribed to cure them. You can reengineer them, reinvent them, recast them, revolutionize them, or reconstitute them, but the patient rarely survives. My advice to the inexperienced practitioner is never, ever volunteer for turnaround duty. Doing cosmetic surgery on a pigs ear is more likely to produce an earless pig than a silk purse. So, in the event your boss designates you as the turnaround doctor, make him or her beg you to do it. Its dangerous duty indeed. Trying to straighten out someone elses mess is more likely to hasten your demise than that of the company youre trying cure. So I recommend you hire a lawyer who specializes in golden parachutes before you take the assignment. When youre charged with turning around a company that has nowhere to turn, be certain you have somewhere to turn when it doesnt. But if you are normally an unlucky person and, therefore, are named "the designated amputator," quickly check the company grapevine to find out whether your boss is testing your competence or your incompetence. If you find he is trying to oust you, try these donts:

  • Dont approach the problem with a closed mind and an open mouth.
  • Dont make any commitments your brain or body cant deliver.
  • Dont look for people who are doing things wrong. Look for the ones who are doing things right.
  • Dont forget that the greatest enemy of excellence is "good enough."
  • Dont confuse your priorities. Where you start isnt nearly as important as where you finish. Youll have a better chance to succeed if you follow these suggestions:
  • Move your office to the turnaround location. Become part of the team.
  • Prepare yourself to listen a lot before you do any talking.
  • Listen to the current management. Find out who does what and why.
  • Listen to the rank and file. Find out what works and what doesnt.
  • Listen to customers. Find out what they like or dont like about the products, the service, and the pricing.
Before you reach any conclusions, make any decisions, decapitate any individuals, or make any promises, share your feelings with your team. Invite your lieutenants to help you analyze the data. After you get their input, go back into the field and test the ideas with the managers, workers, and customers you contacted during your initial investigation. Only then is it time for action. Call your executive team together. Lay out your findings. Invite them to debate the data with you. Ask for their suggestions. Invite them to help author the action plans. Swear them to secrecy until the final plan is written. Bar the door, pull down the window shades, turn off the telephones, restrict the use of the bathrooms, and refuse to feed them until they have helped finalize the plan. Your lieutenants participation is vital to the success of the plan. They must be convinced that "The Plan" is "Our Plan," not "Your Plan." Live thinking keeps dying companies alive. Many an unmarked grave is filled with companies that failed to respond to treatment. Designated doctors know that sick companies require top-notch specialists, accurate diagnoses, capable technicians, the latest technology, the right medicines, and a lot of tender loving care. Remember, too, that if you do all of the above and the patient still doesnt respond, the company isnt sick. Its dead. Sal F. Marino is chairman emeritus of Penton Media Inc. and an IW contributing editor. His e-mail address is[email protected].

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