5 Steps to Turning Around a Failing Business

Salvaging a foundering business can sometimes be as difficult as turning around an aircraft carrier in the Panama Canal. As a new CEO, you may inherit a company with declining revenue, nonexistent profit, flawed products/services and poor morale. That was the scenario this CEO discovered two weeks after being hired at Ready Pac Foods, a producer of convenient, healthy fresh food.

GettyImages-156922815-compressorHe followed these 5 steps to right the listing ship.

1. Identify what went wrong. To figure out what happens next in any story, you must first go back to the beginning. The care you take and the pace you set here will be a defining moment for you as CEO.

2. Assess the current situation. Once you know what the problem is, you must make sure your employees and leadership are ready and capable for the next task: the turnaround. This is a combination of knowing which busses in your fleet are fit to drive and getting the right people on those busses! First I spent time understanding the strengths of the existing management team. I then spent time in the field, visiting manufacturing plants and other operations. I found ways to make quick improvements and effect change.

3. Invest in the team. A CEO must be compassionate to the team that will help him move forward. After my assessment and changes, I promoted some, created new job titles and, where needed, brought in outside help. With a dream team in place, I was able to move toward more complete investments for frontline employees. Investments included training, communications tools, recognition, pay and benefits improvements. I believe the mark of any great leader is to build a fully engaged team that will take you to new and sustainable heights.

“People need to understand what you stand for and where you are going.”

4. Change and update the company’s mission. People need to understand what you stand for and where you are going. Once I’d made the organizational and personnel changes, I tackled the antiquated vision statement. It read: “We will provide high quality fresh foods on a national basis. Our valued associates are innovative and driven to exceed the expectations of our customers and consumers.” As a team we changed it to: “We give people the freedom to eat healthier.” That new vision delivered a clear line of sight to what was expected of employees and the company.

5. Instill discipline and move forward at flank speed. One of the keys to turning around a company is installing new policies and procedures. These may seem onerous, but it is critical to adhere to them in a disciplined and accountable fashion. Simple, transparent, results oriented, and fast. These disciplines insure that the turnaround can stick.

As a result of this strategy, revenue at Ready Pac Foods grew for the first time in five years, and the firm achieved break-even status. In my first full year, revenue grew 10% and profits increased by over $17 million. These steps can help any CEO, new or veteran, make the shift required to turn things around.


MORE LIKE THIS

  • Get the CEO Briefing

    Sign up today to get weekly access to the latest issues affecting CEOs in every industry
  • upcoming events

    Roundtable

    Strategic Planning Workshop

    1:00 - 5:00 pm

    Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process

    Executives expressed frustration with their current strategic planning process. Issues include:

    1. Lack of systematic approach (70%)
    2. Laundry lists without prioritization (68%)
    3. Decisions based on personalities rather than facts and information (65%)

     

    Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns.  They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning.  Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process.  This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented.  If you are ready for a Strategic Planning tune-up, select this workshop in your registration form.  The additional fee of $695 will be added to your total.

    To sign up, select this option in your registration form. Additional fee of $695 will be added to your total.

    New York, NY: ​​​Chief Executive's Corporate Citizenship Awards 2017

    Women in Leadership Seminar and Peer Discussion

    2:00 - 5:00 pm

    Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations. 

    Limited space available.

    To sign up, select this option in your registration form. Additional fee of $495 will be added to your total.

    Golf Outing

    10:30 - 5:00 pm
    General’s Retreat at Hermitage Golf Course
    Sponsored by UBS

    General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.

    The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.

    To sign up, select this option in your registration form. Additional fee of $295 will be added to your total.