Marshall Goldsmith for SuccessTelevision.com
When times are tough, becoming a new leader from outside the
organization is both a blessing and a curse.
The good news is that the world's not going to immediately
blame you for the company's problems. The
The bad news is that the company does have serious problems you need to fix. And the economy may get worse before it gets better, inhibiting your chances for an effective turnaround.
So what are some of my suggestions for a new CEO entering into a difficult situation?
My first: Don't trash your predecessor.
Whatever happened in the past happened. You cannot change that.
Your predecessor probably had good relationships with many of the
executives who are still in the company and are running key
divisions and key functions. Do whatever you can to learn from your
predecessor. Although a few CEOs are asked to leave because they
engage in immoral or illegal activities, most are asked to leave
because they just make mistakes. Your predecessor probably did many
things right. Your predecessor knows – perhaps more than anyone –
the key relationships that you will need to develop in order to be
a success. Go out of your way to build a positive
transition.
For instance, I have a colleague who has been working with the
Obama team on the transition from President Bush to President
Obama. He has been pleasantly surprised at the level of help and
cooperation offered by leaders in the outgoing administration. He
has found them incredibly helpful in sharing the 'nuts and
bolts' of running the government and found them to be
grateful that they are being listened to and
treated with respect.
My second suggestion is to respect the history and tradition of your organization. Consider my friend Frances Hesselbein, who won admiration from management gurus for her incredible turnaround at the Girl Scouts of the USA in the 1980s. In her thirteen years at the helm, she dramatically increased membership and raised significantly more money. She also focused on the importance of diversity and made an organization that was becoming irrelevant – relevant again. While she worked very hard at creating a vibrant organization that met the needs of changing times, she always respected the history and traditions that had made the Girl Scouts a great organization in the past. (Ms. Hesselbein and I are on the Leader to Leader Institute board of governors, of which Ms. Hesselbein is the chairman.)
My third suggestion is write off whatever you can – now! As an incoming CEO in a tough situation, you need a brutally honest assessment of the problems faced by your company. Turn over every rock! Let your executives know that they will not be punished for disclosing concerns now – but that they will be fired if you find out later that they did not tell you the truth about what is really happening.
One of my favorite clients, who eventually succeeded in turning
around a disaster, tried valiantly to implement this strategy. He
thought that he was being clear with all division presidents. By
year's end the company had written off over $1 billion, which
was by far the largest write-off in the history of the firm. As it
turned out, one key division president, who was near retirement,
had "fudged the numbers" in an effort to look good in his
last year. When this mistake came to light, the company had to
write off another $200 million the next year. The CEO told me that
the $200 million write-off that occurred the second year did more
damage to the reputation and stock price of the company than the
billion-plus write-off that had occurred the first year.
Click here for my final final suggestion
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Dr. Marshall Goldsmith's 24 books include
"What Got You Here Won't Get You
There" - a New York Times best-seller, Wall Street
Journal #1 business book and Harold Longman Award winner for
Business Book of the Year. His latest book
"Succession: Are You Ready?" - is the
newest edition to the Harvard Business 'Memo to the CEO'
series.
