Who killed your corporation ? Ten clues to start..?

If you’ve worked for a fading large corporation (or still do), you might have, as a loyal employee,?raised your hands in despair sometime, frustrated at the whacking it might be getting out there & the apparent ineffectiveness on display by the leadership in fixing the leak.

And while most of us rant at the coffee machine (or ‘Like’ each other’s rants on social media) & draw a sense of patriotic productivity from it, most common Jos like us lack the bandwidth to do much about it because even when we show up & do our bit with diligence & pride, the sum of the bits doesn’t quite add up to the whole that’s needed to mend the mess. Put simply, it’s a leadership vacuum at such struggling organizations because, frankly speaking, if it were for externals alone, every large organization would be getting whacked today, which is not the case. Some are doing so well that the contrast is embarrassing. If you observe closely at some of the struggling giants, you can draw certain common factors that are responsible for the rut.

Let’s examine the top ten here. If you have an 11th or 12th to add, please feel free to comment.

1. The Superstar ‘Ex’ –?Every?iconic organization becomes iconic because of a superstar leader at some point in its journey. You know the examples – visionary men & women with superhuman drive, clarity, passion & combativeness that puts them miles ahead of peers. And while organizations land their glorious years under such a leader, they often fumble & stumble when the leader departs (or retires). Especially so because it would have attained a certain credibility by then which generally comes with a longish tail & there’s a time lag between the exit of the superstar & the discovery of the cracks that creep in thereafter. This lag can sometimes run into years, by when it’s often too late & calls for bloodshed.
2. The inept ‘Next’ -?Brings me to my next point. Great men’s (or women’s) shoes are tough to fill as such. Very rarely does a superstar succeed another superstar. The successor walks in with a full belly, thanks to the spoils of a predecessor’s success. In worse scenarios, sometimes?outgoing superstars with?inflated egos?deliberately?handpick duds to succeed them, just so as to lengthen the folklore around their own tenures. In either case, such?successors mostly lack the fire or heart to aspire for higher altitudes because they’re already dizzy from where they’ve landed. So, they fall for cronies & fads & all the bullshit that’s fed to them. They surround themselves with B, C & D players, they encourage walls, labyrinths & silos & they keep falling for false reassurances they get from the business media, thanks to the (still undiscovered) role of spillover success that’s flowing in. Meanwhile, unlike?the Hammurabi Code, such leaders keep collecting the upside & don’t own the downside of their actions. For example, while they collect $100M (say) as bonuses over a decade for fiddling with & eventually running the company to the ground, they neither have a claw-back on their earnings and are seldom (if not never) sent to jail for their ineptitude, which would have deterred future miscreants from repeating such leadership follies.
3. The Paranoid Board?– A crafty successor, as described in Pt # 2, quickly understands how to play the board game. Thanks to its lowered defenses because of the erstwhile purple patch, the board allows the new person to hoodwink it into risky investments & stupid acquisitions sold with fancy stories created by a team of smart MBAs (more on this later). In a few years, such leaders also learn how to influence the board by getting their pals in from outside. The cozy club keeps going till the first whiff of calamity trickles in. Then, the next. And so on, till the Board wakes up and smells the coffee. It’s here where the activist investor steps in. There’s a rejig that follows. The leader tries to smooth-talk his way for a few more quarters before getting eventually kicked out. The new Board meanwhile has gotten so paranoid that it gets into micromanagement. It needs to know about each bolt & nut and employs stock price as the only metric of organizational health. The new handpicked leader has no option but oblige. And soon, the employees & the customers are quickly forgotten while the organizational values are quietly reduced to just a fancy frame hanging from a wall.
4. The beefed-up competitor?– When the above drama is unfolding at an organization, a competitor is invariably getting better (almost by Murphy’s Law). As this organization keeps slipping in innovation, hiring, retaining &?revenues – the challenger is over- delivering on all of these and more. It launches the next-gen product, lands the right partnerships & precisely enters the new markets where the action is. The fading champ meanwhile kicks about in denial, dismissing the challenger in an unflattering manner, milking on its great legacy?that’s not so great anymore. In a bid to slug it out with a stronger, younger adversary, it gets into a price game. It lowers quality – of products & services, and most importantly, it lowers quality of hiring. The old good employees, frustrated at seeing their loved company going down, try to keep it together for a while. Then they too quiet. Mostly they show up at the competitor’s place.
5. ?The fat salesman?– Quick disclaimer -?I’m not stereotyping or body-shaming here. The ‘fat salesman’?is a metaphor for everything that’s an antithesis of a vibrant & winning commercial organization. Whenever decay sets in at an organization,?fat salesmen?start sprouting at all corners. They, who are supposed to be your?‘face-to-the-market’, are mostly found in office (Or ‘working from home’. Or mysteriously missing, with a prompt out-of-office messenger on their emails). The primary job description of a?fat salesman?is to set up and attend meetings. Then, meetings to summarize such meetings & more meetings to plan for the next meeting. We grew up on a simple metric during our formative years – if a sales guy is not generating a profit (not revenue, but hard?profit?after all expenses) that’s 5X of his CTC, he needs to be kicked out. Most?fat salesmen?at dying organizations don’t manage to even rake in the equivalent of their salaries & travel expenses by way of new business. Hence, I wrote a full-length chapter earlier in this book on Fat Salesmen, to give you a detailed view ??
6. The clueless marketeer?– In any growing and successful organization, marketing is a bottoms-up summary of a voice-of-customer that leads into initiatives to identify a gap to fill in the market. It’s 80% art that’s tied together by 20% science. More critically, marketing is way more than trends & fads & slogans & brand-positioning. Marketing is horse sense & genuine empathy. It is the ability to see the market of today as it is & also to foresee the market of tomorrow & the day after. Now consider all this information & try to imagine the marketing team of a failing outfit. You’re most likely going to find a bunch of clueless MBAs perched on silos & engaged in a contest of charts & graphs drawn from an exhausting pile of irrelevant data (fed to them by external consultants at a fee), which they promptly back-fit into a PPT for the functional leaders to get more & more muddled. These marketeers (in dying organizations) mostly walk around with a sneer on their face & get nominated for fancy bands & titles while the tide lasts. Thereafter they mostly become unemployable after being unceremoniously escorted outside the main gate?following a bloodbath.
7. The finance manager?– I often joke that I learnt my finances from ‘Kabra ji’, a near invisible accountant sitting on the mezzanine floor of my largest dealership. A man of limited education but an erudite in his own right when it came to practical finance management, Kabra ji closed his books every three weeks. Cash flow, inventory accounting, debtors exposure & weekly collection, and a ruthless ROI measurement every 3 weeks was what made Kabra ji such a rock star. Compared to the humble Kabra ji, most highly educated finance managers in large & failing organizations mostly lack the aptitude or zeal to see the big picture. They are either always chasing pennies or some irrelevant tangential deliverable, if not making presentations for their boss’s review with the boss’s boss. And when the hemorrhaging starts, these finance managers get into financial jugglery, postponing debits & preponing future revenue recognition to deck up the balance sheet, till the time when hell breaks loose & they are booted out along with their clueless CFO.
8. The Photo Op?– Digitalization & instantaneous connectivity, with all its merits, has also brought in its share of perils. Virtue signaling is perhaps one of the most subtle and yet the most dangerous trait that’s crept in at large organizations and completely messed up the priorities. Thanks to an ever-ready impressionable audience with their instant applause & fleeting attention spans, leaders have started mistaking social media votes to be badges of honor. In the good old days, work used to be work, and beyond linear (& holy) work, there used to be some feel-good activities (that sounded benign & grown up)?to tick the checkboxes as needed. Today the mad scramble to tick those checkboxes has become the primary activity of?leaders and the extra-curricular has stealthily become the curriculum. So, you have leaders who are Twitter icons and who have mastered the art of the perfect photo-op, but who cannot deliver on the real work, even to save their lives. I would have given examples of such checklists, but I am valiantly resisting the temptation ??!
9. The hapless HRM?– Okay, I have some great friends who are amazing HR leaders ( Aarif Aziz or Hari Menon – if you are reading this, here am I, cheering for you! Leaders like you rock!). But such folks are a pitiful minority. Majority of HRMs today have no heart in a game that’s all about heart, and barely contribute anything to the organization beyond following orders of the functional management, copy-pasting job advertisements (or getting them outsourced) & lazily going through the grind of some pre-formatted employee engagement rhythm that has zero soul (besides ordering pizza during the quarterly reviews). It is not right to say that their bandwidth has been taken away from them. If that was so, you would not have had the handful of HR Superheroes left, men and women who are exemplary partners to the businesses. The problem is, most HRMs are not even?people-people?at heart and are just doing a?job. They have no real interest in their fellow employees & they are awkward when it comes to step beyond a JD to understand an employee like a human being or coach someone out of a corner. Bad organizations have the worst HRMs – a bunch of self-centered, spineless & vindictive people who are forever stuck in a personal agenda. Oops - Did I just remind you of someone?
10. The entitled Kids –?Most large organizations have these fast-track programs for short-circuiting high potential leaders up. While the premise is noble, dying large organizations try to hang on to this practice as a chore and?try to?fill-in?such programs with mediocre young managers, who, thanks to all the mollycoddling at such summer camps, grow an overbearing sense of entitlement in themselves without having earned a single scar in a real battle. These kids are then handed important roles after some successful elevator pitch, a job that they promptly screw up. But by virtue of being sunk cost for the organization, the kids are not roughed up.?Rather, they get moved to the next important (preferably?safer) role. And unless they commit some real billion-dollar disaster along the way, they end up at the helm of a P&L in a few years. And you know the rest.

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(This is an excerpt from my 2021 book, 'Life-ing it'?. That, and my other two books, 'As you life it' ?& 'Once upon a someone'? , are available on Amazon in your country).

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