How do you communicate bad news or difficult decisions in a turnaround?

In a turnaround, communication of bad news or difficult decisions demands transparency, empathy, and clarity. It's crucial to address the situation promptly, providing context while acknowledging the impact on stakeholders. Expressing empathy and understanding can soften the blow, fostering trust amidst uncertainty. Utilizing clear, jargon-free language ensures comprehension and minimizes confusion. Additionally, offering a path forward, outlining plans for resolution or mitigation, instills hope and confidence in the organization's ability to navigate challenges. Effective communication in tough times lays the foundation for resilience and collective commitment to the turnaround journey.

Understanding your audience helps tailor your message. Employees worry about job security; customers care about service quality. Timing and tone matter.

Knowing one's audience is crucial and I remember leading two simultaneous turnarounds on the shop-floor years ago while I was site manager for API & sterile solutions sites. We would try to be quite thoughtful about 'communication cascade' from morning meeting to shift meetings throughout day via email and F2F. We had close to 500 FTEs across facilities on 24/7 shift coverage, so coordination and multi-mode communication was key. Customers also must be carefully considered and engaged in dialogue with thought given to whom from your organization will be responsible for which customer. FAQs often helpful. Overall, purpose-informed vision with a clear message tailored to audiences where needed and delivered honestly is critical.

The sign of a good leader or advisor is emotional intelligence and empathy. Messaging shouldn’t just be from the perspective of the messenger. Employees may be jittery and concerned about job loss — for themselves and their colleagues. This means communication should be frank but also compassionate given the sensitivity of the circumstances. On the outside, lenders, creditors, and investors may be skittish about not getting paid. So they may be clamoring for reporting, milestones, deliverables, and cost-cutting measures to go into effect. These two perspectives can sometimes be at odds with each other so leadership and advisors need to be cognizant and skilled at managing the balance.

In a true turnaround, investors, creditors, vendors and employees can win, or they lose all. The pain must be shared. In some cases, there may be an opportunity of turning a vendor or customer into a strategic partner who is willing to put some “skin in the game.” A well-managed turnaround is a great opportunity requiring “all hands on deck.”

Transparency builds trust. Explain your decisions clearly, use data to support them, and acknowledge their impact. This fosters credibility and trust.

Fact-based description of the situation as context, range of factors taken into account, and how the decision was reached can all be sections of the messaging. In situations where an individual's future is impacted, then sometimes usage of one-page memo with information on severance, benefits, etc., can also be utilized to provide facts looking forward.

Rather than spring rash decisions onto people, there should be clear justification. Through strong financial analysis and modeling, financial basis can offer clear explanation as to why certain actions were taken. Proof is in the numbers, not bias or politics.

When it comes to change, there will always be confusion, and resistance. This is more because of uncertainty rather than their non-willingness to comply. As a turnaround manager even though my goal is to bring in the necessary outcome by making changes this doesn't mean that I have to be authoritative in this regards. Understanding the concerns of my audience, being transparent with them, making them understand the need for change is absolutely necessity. Empathy and Compassion is not a negative trait nor an optional trait. When the situation is tough showcasing compassion and empathy will help get things done much more effectively as every concerned will be happy that their concerns have been taken into consideration and addressed.

Beobachten Sie die Reaktionen und die Stimmung der Mitarbeiter nach der Kommunikation. Nehmen Sie Feedback ernst und ergreifen Sie gegebenenfalls weitere Ma?nahmen, um Bedenken anzusprechen und direkt zu adressieren, anstatt dem Flurfunk das Feld der Nachbesprechung zu überlassen. Halten Sie die Kommunikationskan?le offen und informieren Sie die Mitarbeiter regelm??ig über den Fortschritt und zeigen Sie dabei auch ihre Emotionen in Bezug auf Entt?uschungen oder Etappenerfolge. Es hilft nicht bspw. den Trennungsschmerz bei der Entlassung von Mitarbeitenden zu ignorieren. Zeigen Sie dass auch sie diese Emotionen teilen und dennoch die Ma?nahme für erforderlich erachten, um die Herausforderungen des Unternehmens zu bew?ltigen.

Showing empathy and compassion can transform resistance into support, fostering a cooperative environment crucial for successful turnaround management.

Hopefully, all of us aspire to be empathetic or sympathetic with others going through turnarounds that may impact their lives. These times can also be emotional for both parties and important to remember that it is ok to be vulnerable with others, as that usually demonstrates a level of understanding to them.

Engaging stakeholders in dialogue fosters trust and innovation. Their feedback can reveal hidden issues and spark creative solutions, enhancing turnaround success.

Very helpful throughout the process where possible to "co-create" with at least mid-level managers and above to start, but even broadening to entire workforce over time once a conceptual framework is in place. But, then lunch-time presentations or other similar forums, helpful to engage in 'case for change' and then solicit ideas and build a program. Over time, this co-creation creates supportive (and sometimes not, but still helpful) voices in the organization, which is invisible yet invaluable to the success of transformations. We often would even showcase or celebrate someone every week that came up with a great idea and/or implemented one even if it did not work as encouraged entrepreneurship.

Meiner Erfahrung nach ist es wichtig, Bereitschaft zu zeigen auf Fragen und Bedenken einzugehen. Nicht immer ist der Kanal in dem die Botschaft überbracht wird auch der richtige Ort für einen Dialog, dann sollten aber m?gliche Feedbackkan?le und Austauschm?glichkeiten benannt werden. Wenn Sie auf eine Frage keine Antwort haben, seien Sie transparent und versprechen Sie, die Frage zu kl?ren und darauf zurückzukommen oder zeigen Sie Abh?ngigkeiten auf, wenn es für eine Aussage noch zu früh ist.

Leaders and advisors in turnaround situations often serve as liaisons who also happen to have deep technical expertise. This brings tremendous value to tenuous situations as the financial acumen offers a basis for decisions while the nature of being a liaison means they have to serve as a counselor and referee. The ultimate decisions may not always reside with this person but they’re in a critical role to bring out the data, intelligence, and difficult conversations among conflicting parties.

Having good record of the turnaround program is important for variety of reasons ranging from financial to plan and track impact to baseline typically in face of other changing variables like price. In addition, important to have record to track workload and ensure Talent is being developed and not depleted, including culture and morale as well, which are critical, but harder to track empirically, although occasionally sending out pulse surveys works. Also, can be helpful to link the turnaround program goals to EBITDA impact targets with clear accounting as can be helpful and/or required by several underwriters for debt provided, esp. in LBO situations.

Following up and following through in turnaround management not only ensures accountability but also builds trust and morale among stakeholders, which is crucial for sustaining long-term recovery and success.

Undoubtedly the key difference in a turnaround versus a performing situation is a turnaround requires constant monitoring and testing. Decisions to cut costs may not have the intended benefits. So rather than move forward with speed and bullishness, leadership and advisors need to run scenarios and track the impact of chosen paths. Not everything will be perfect — in fact, turnarounds are often extremely messy. But just as a surgeon does the best job possible, knowing there may be terrible side-effects, leadership and advisors may make decisions knowing the same.

When it comes to communicating bad news or difficult decisions in a turnaround, empathy is key. It's essential to approach these situations with sensitivity and understanding, recognising the impact they may have on individuals and the organisation as a whole. Be transparent about the challenges the business is facing and the need for tough decisions. When delivering the news, choose words carefully and deliver the message with empathy, compassion, and respect. Keep individuals informed about any positive developments or steps being taken to address the challenges. By demonstrating empathy and staying connected, you can help build a supportive environment and promote a sense of unity as the organisation navigates the turnaround process.

Die Kommunikation schlechter Nachrichten erfordert Fingerspitzengefühl und eine klare Kommunikation. Indem Sie ehrlich, transparent und unterstützend sind, k?nnen Sie dazu beitragen, Vertrauen aufzubauen und die Mitarbeiter durch den Change- bzw. Turnaround-Prozess zu führen. Mir fehlt im Artikel bisher die besondere Relevanz des Timings bei der Kommunikation. Einerseits gibt es rechtliche Vorgaben wer in welcher Reihenfolge und mit welchem Vorlauf worüber zu informieren ist und andererseits gilt es durch frühe Kommunikation die Informationshoheit zu sichern.

Turnarounds, often post-close, can be nerve wracking times for people and they do not have to be to the extent they have been. Important to co-create where possible, communicate often and clearly, celebrate wins as they occur because helps balance out some of the painful decisions needed along the way. Never forget handling properly is critical as Talent remains the most critical element for any organization, which rests upon the Trust equation as follows Trust = Credibility + Reliability / Self-Orientation, so be credible with facts to support the case for change, be reliable in communicating and meeting commitments, and never forget to put yourself and rest of the leadership team in shoes of othes.

Every business is different. Every scenario is different. As a turnaround manager, one need to be aware that previous efforts may not be the best way to deal with current situation at hand. More often that not tough decisions have to be taken. That's why we are brought in. Tough decisions when they are communicated need not be harsh. It has to be straightforward but never harsh. Understand the key players, understand the right means of communication, be clear and precise but always make sure that it is delivered in a compassionate way. Getting back to winning ways is very important, however, how we reach there is equally important and this part many managers simply forget to take into consideration.