TURNAROUND

Through my career I have lived different kinds of crisis, from different sizes, direct impacts, collateral impacts

and surely the vast majority of the people reading this article have faced one or several crisis in their lives

(Financial ones, quality, supply, capacity or even cocktails of multiple factors in crisis) in addition to some

other challenges as family issues, economic issues or professional ones.

For some of these crisis, we maybe have had the roll as leader, taking the lead of all actions to come out from

this crisis, or in others our roll has been as participants, but I am sure we all have faced a crisis at least once.

During my career I have had to face plenty of them, and little by little I have been professionalized in this topic

and even I have given classes or training to prepare some other people in crisis management, and mentoring

others to come out from them.

I would like to divide this topic of turnaround crisis management in 4 phases: The first phase is to understand What are the crisis causes? and What are the ways to revert these crisis?

Forming a team and a good plan to come out.

The second phase is to execute that plan, face the crisis, communicate-communicate-communicate

and come out from the crisis.

The third phase is to stabilize and correct the systemic causes, what was the crisis origin?, to avoid

re-occurrence and avoid that other is being formed in the future.

And the 4th phase is to grow / keep growing, construct from this new base point.

So, coming into action and being more specific. Let’s talk about the first phase:

I remember a case where I was just hired in one company and the very first day I discover that we were burning

a lot of money in premium freights. We were having multiple premium freights to different customers,

all customers were already inside our plants trying to take control of our plant to avoid that we shoot them down,

we were having many quality issues, very high pressure over the people, moral of our employees was really low.

By asking details to the different team members, we can figure out that every single member has a different idea

of the root causes, different view points of the priorities. So the first thing I did, and what I have done in every

other in the past, is to analyze by myself the topics, by topics I mean the sales situation, the financial data,

the situation with every customer, the installed capacity, the products flow, the quality problems, the supply chain,

our organization, the people we have. To know and construct a clear panorama of the reality!

I try to put all of these topics into a square, into a box, to really clearly define what are the problems. And then

we can show to the team here they are, we all can see them. And then we can determine priorities.

The 4 or 5 more important subjects to focus (the most important and the most urgent). This means we need

to generate focus points (we shall not use machine guns; we need to use precision rifles) so one by one

we can eliminate the problems.

And at the same time, we need to analyze Who is in the team? What are the personal resources that we have

available? Who is in front? What are their strengths? How is their moral? How these people Work?

(Because we need to compose a team), a strong team. And if we assess that people with different capabilities

is need it, then we need to acquire them, we need to be surrounded by the right team. Some companies need

external support, if they ask for them, the success will be reached faster; but the lesson here is:

Success is achieved through the people!

And then, the team together design the strategy focused in these 4 to 5 important points, but also knowing

the following 5 points (priority B) to ensure that our main focus in directed to the priority A, but without creating a

deterioration on points B. That means we would not like to have negative consequences on the second priority

topics.

So, in summary the Phase 1: Understand the main problem. Define priorities. Create a team.

Establish the main action plan.

Now we can move into Phase 2.

Which is execute that plan, confront the crisis, communicate-communicate-communicate and come out

from the crisis.

OK, we initiate executing the different attacking plans simultaneously for the defined priorities.

Building the teams, giving the authority and the required resources to attack the problem, and resolve it.

We need to get and analyze trustable data, resolve the issues as a team, release capacity, ensure process

stability, components quality, material supply… you name it… whatever is needed to execute the agreed plans.

We need also to establish a very very clear way to report out and communicate the advances to all stakeholders.

This is, in addition to the work to come out from the problems we need to have a very good communication.

Focused on the corporate, focused on the customers, focused into our directors, management and leaders,

and focus in all out people. We must be clearly communicated.

And this means to clearly define who communicates what, who brings the reliable and clear data, who prepares

the information, who is the speaker. This is very important topic because we need to take control over

the information, of the history line, the logic, the sequence, to demonstrate progress, demonstrate that there is

a plan, demonstrate that the plan is being executed.

In this way we can start to show control, the issues are been resolved step by step with solid steps, it starts

to make sense, the people are getting aligned. But the most important, is that the motivation comes to the

surface, there are the first appreciations, people starts smiling, the sense of success starts (inside and outside

of the organization) and this force is very very positive.

People is getting aligned more and more, the persons who were not supporting now are getting into the boat,

a success boat.

I think the greatest learning here is that there is not a force that moves and motivates more that success!

Little, medium or big success, but constant, success bring success and this creates team motivation

and strength. The power is getting up, now coming to work have a purpose, have a positive sense.

Summary of the second phase is: execute that plan, confront the crisis, communicate-communicate-communicate and come out from the crisis.

The 3rd. step/third phase is Stabilize to ensure no go back to the same situation.

This I Will not going to detail, but

1: we need to define and have a clear and right structure according the needs.

2: Ensure to allocate the right people in the functions defined at this structure.

3: Process, Procedures and Systems: I mean Sales processes, Manufacturing processes, Admin processes,

the right systems, metrics and indicators, reporting system.

4: Elements to Motivate that all this is executed and achieved (Consequence system, positive to move people

into action, to recognize good performance, but also the consequences in case of no execution, damages

or unappropriated behavior)

This means to prepare the ground for deep strategical topics, business model or operative models.

And now the 4th phase is to grow, we do not want to be stable, we need our companies to be great, we need

to expand the business, acquire new customers, penetrate new markets, but also improve our products, improve

our processes, we need to vigilate what is happening around our business and be agile, adapt and be better than

our competitors to be the preferred solution for our customers.

Certainly I have made many mistakes: I do not think a single recipe exists, I am conscious that under the heat of

the crisis I have said words that hurted my people. Sometimes the information was not well prepared or was not

fully right, something did not worked as expected, your best person is exhausted and leaves the team.

But I think that the most important is to wake up, analyze the mistakes, recognize the mistake, apologize with

the people you hurted, learn to do not repeat the issue over and over, and grow. And keep moving forward…!

I hope I can contribute and help you through these 4 phases and the storms and crisis can be reduced and

be converted in a sunny day, where your company and your teams can develop and grow, I keep available

if you require professional support to come out from your crisis and pursue an operational excellence.