Turning companies/ brands around may sound a little disturbing under the current economic turmoil or it may be seen as a hallucination. However, turning brands/ companies around could mean essentially recovering them from a major dip in revenues or from a major dip in profits. It may also be seen as a process in which the organization/brand finds its energy back or maybe revitalizing or rejuvenating the brands to deliver better results. This may also be referred to as taking a leapfrog.
Turning brands around is not easy as it demands the presence of many factors which are preliminary requirements for a turnaround.
- Turnaround strategy – any brand would need a strategy for the task of turning things around as it’s more of setting a new direction for the brand or the organization. Branding itself could be a turnaround strategy or it may also include changes in the distribution strategy, production or procurement strategy, changes in strategic human resources, changes in the infrastructure etc.
- Change agent – Turnaround essentially means change. Therefore, it’s a must to have a change agent or an owner for the process which mostly be someone from the C-suit. The idea here is to have an owner introduce the required change and then keep the momentum going.
- Support system – if the change is brought about by an employee or the CEO the board has to support them to make sure, he/she overcomes the obstacles that are posed by the others. It’s mostly about how close the change agent with the “power base” of the organization. Powerbase could be the chairman/MD or the board of directors. The change agent has to be managing the top and the bottom well to find the right direction which is evidently a tall task in today’s context.
- Financial and other resources – Resources are the key to success as without resources it’s extremely difficult to cope with the challenges coming from the outside environment. Human resource undoubtedly is the most important resource as humans can think, feel, and grow their potential to grow the organization.
- Teamwork – A leader is as good as his or her team. In the absence of a solid team, the leader too can fail. Therefore, putting up a strong team means a lot in the turnaround strategy. This may also require structural changes to the organization and recruiting new talents to fill the vacuums.
A preliminary study of the existing culture and the internal environment is key to success as there are three things that need to be changed for a successful turnaround. Be mindful that, the study should mostly be quantitative than qualitative.
- Leadership – If the current leadership has not been able to get leapfrog for a considerable time, it’s mandatory to change the leadership positions of the organization for it to get fresh thinking and new ways of doing things. The leader must bring new challenges to the team and identify the supporters in the team to build a strong culture.
- Confronting Brutal Factors – Most organizations that take a leapfrog or a turnaround confront what’s known as BRUTAL FACTORS. There are a set of issues that are hindering the progress of the organization. They need to be addressed at the outset. Basically, the leader’s role is to sort them out by taking the bull by the horn. Probably the organization hasn’t moved forward due to not addressing them or not identifying them and solving the issues. In one of the organizations, we turned around in one year; the brutal factor was the distribution system. Changing the existing one wasn’t easy as the whole sales staff was so used to the way they were doing things. Changing this required a change in the annual planning mechanism, changing the hierarchy and appointing new distributors, and new demarcations which required a considerable investment of time.
- Culture of discipline – as explained by Jim Collins in his famous book – Good to Great; what allows an organization to take the leapfrog is DISCIPLINE. As he rightly mentions and as we have experienced in our journeys of turning organizations around, three dimensions of disciplines are looked at. They are Disciplined people, Disciplined thoughts, and Disciplined actions.
- Disciplined people – In the presence of undisciplined people, the people who are committed to work also get spoiled by those who are not disciplined moreover, the good people can be turned into bad by those who are undisciplined. Disciplined people also value their job, and they give their 200% to the organization as they have a sense of gratitude for the organization.
- Disciplined thoughts – Positive thoughts of the staff are a blessing, and it is pivotal for success. If people think of internal politics, divisional wars, power struggles, cutthroat strategies, and basically evil thoughts it will surely have a negative impact on the organizational success and progress.
- Disciplined action – Disciplined people with disciplined thoughts would always do good. They think good and act well. There is no time wasted as they always do things that have a positive impact on the organization.