The Essence of a Turnaround

When I stepped into the role of CEO at a struggling tech company, I thought I had a firm grasp on the challenge ahead. The investors, after 18 months of significant burn and slow sales, were looking for an exit. As I delved deeper, I realized that the true essence of a turnaround lies not just in financial metrics, but in the very fabric of the organization itself.

Winning Solves Problems

In the world of business, especially growth-stage companies, one truth stands paramount: Sales growth is #1. This isn’t just another piece of corporate wisdom; it’s the lifeblood of any organization striving for success. Winning, primarily defined by sales growth, has the power to solve almost all problems.

However, the path to victory isn’t paved by sales alone. It requires a synchronized effort from every part of the organization, moving in unison towards a common goal. This synchronicity is the hallmark of a healthy culture, and establishing, refining, or remaking this culture becomes the primary task for any leader aiming to turn a business around.

The Pitfall of the “Proven Playbook”

It’s tempting for executives to attack growth problems by over-subscribing to strategies that have worked for them in the past. The familiar refrain of “Let me vet and implement this strategy, apply these KPIs, and recruit these execs that I’ve worked with before to help me scale” is often heard in boardrooms. However, this approach really works when the CEO has become fully oriented to the current environment, including:

- State of the company culture

- Customer perceptions of the company

- Issues affecting the company and the industry the company serves

The orientation is critical as making a decision to early for the sake of time can be just as detrimental as making a decision too late, especially when it comes to people. As Andy Grove wisely stated, “Culture eats strategy for breakfast.” In any turnaround situation, a broken culture can render most other fixes ineffective.

Cultivating Purpose and Meaning

Upon assessing the company, I quickly realized that most of the team(s) couldn’t articulate why they showed up on Monday. And the few that did, had different answers. They needed clarity, purpose and meaning — and incidentally, so did our investors, especially with the next funding round on the horizon.

To address this, we did two (2) things quickly:

1. We called an all-hands meeting and asked each person to answer two (2) questions on a notecard:

- What does the company stand for today?

- What are your aspirations for the company to become?

(These type of analog exercises, a refreshing change from digital monotony, provided invaluable insights into our team(s)’ perspectives and aspirations).

2. The leadership team and I spent a full day, on a Saturday morning in-person, with bold coffee in hand against the backdrop of a whiteboard, reviewing and assessing this feedback.

The Four Fundamental Questions

Based on the team(s) feedback, we distilled our focus down to four (4) fundamental questions that every organization needs to answer:

1. Why do we exist?

2. What do we do?

3. What’s most important right now?

4. Who needs to do what?

Notably absent from this list is the “how.” That’s intentional.

Giving ownership of this process to the team(s) to define the “how” is the job of the team(s) — it’s what empowers them and gives them ownership in the company’s success. This is not to say that this is not done without leadership’s participation, rather the onus is on the leadership team and other key persons to shape how the company is going to make progress against their “True North” by hitting the important milestones along the way.

By seeking the team(s) input upfront and using it to inform (not dictate) our strategy, we set the foundation for a more engaged and motivated workforce. This approach is crucial for creating a healthy culture and is the second most important job of the leadership team. That relationship is what drives buy-in and accountability.

To truly empower teams and foster a winning culture:

1. Seek their input early and often.

2. Be assertive in defining the four fundamental questions.

3. Underpin these with strong core values.

When executed successfully, this approach can quickly give rise to a winning culture, setting the company on a path to success with fulfilled team(s), delighted customers, and robust sales growth.

The essence of a turnaround lies not just in financial strategies or proven playbooks, but in cultivating a culture of purpose, empowerment, and aligned effort. By focusing on these elements, alongside a relentless drive for sales growth, even the most challenging turnarounds can lead to remarkable transformations.

Thank you for reading,

Chris

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Chris Greco is a dedicated father, husband, and CEO known for his faith, underdog grit, and perseverance. His boundless energy and core values approach have been instrumental in uniting organizations to achieve goals that once seemed unattainable.

Beyond his professional achievements, Chris serves as a Board Director, advisor to growth-stage companies, volunteer, and keynote speaker. He resides in Kansas City with his wife, two children, and their rescue dog.