This year I had the good fortune to moderate a panel on business turnarounds at the Charleston Conference. By “turnarounds” I mean situations where an organization has fallen on hard times. From a management point of view, this is a very different experience from working on a start-up or having the responsibility for a company that is doing well. It is common nowadays to call some turnarounds “pivots” or “repositionings,” which may smack of euphemisms to some ears.
Our three distinguished panelists — Mark Cummings, Publisher of Choice; Dennis Lloyd, Director of The University of Wisconsin Press; and Pinar Erzin, Founder and CEO of Accucoms — each had very different stories to tell. Mark had to wrestle with a core product whose editorial rationale was being overtaken by events; Dennis walked into a thoroughly undermanaged environment, where the basic blocking and tackling of a publishing company was being ignored; and Pinar had the challenge of having to buy her company from its parent, which had filed for bankruptcy. Both Choice and The University of Wisconsin were or are clients of mine, so I know first-hand how difficult the situations were. Pinar’s description of trying to raise venture capital to buy the company will make us all long for a 9 to 5 job with a big, boring corporation.
I have worked on a number of turnarounds myself over the years, and I can attest to the fact that they are stomach-churning. On the first day in the office you have to view each member of the staff with an eye to whom you will be showing to the door within the first month. You know that warm collegial feeling you often get at work? Well, in a turnaround you work under a cloud of dread. The only universal rule is, if there is nasty work to be done, do it fast and move on.
The real question about turnarounds, though, is how the organizations got that way in the first place. How could the University of Wisconsin allow the Press to get by without a business manager for several years? Who was monitoring Choice as subscriptions went into decline? All problems of this kind come down to governance, a matter I have sounded on the Kitchen before. In turnarounds it is common to fire the CEO or Executive Director, but perhaps the blame lies upstairs.
My own experience with both turnarounds and working on growth opportunities is that the critical driver, the secret sauce, the source of the glow of octarine is people. We talk so much about brands and balance sheets, marketing and sales, but in the end it is people who make the difference.