Everyday Turnaround: The Art and Science of Daily Business Transformation

By Eric Kish

Every successful business needs to have turnaround tactics in its arsenal. When a business is struggling, it’s these tactics that will turn the tide. Everyday Turnaround tells the tale of a turnaround CEO of a fictional organization who uses agile tactics such as kaizen and scrum to achieve success.

Author Eric Kish developed and tested the Everyday Turnaround concept while executing 12 turnarounds across seven industries and three continents over a period of 18 years.

• Language: English
• Publisher: BookBaby
• Release date: Apr 30, 2017
• ISBN: 9780998531007

Book preview

Turnaround (noun) - a positive change, improvement¹

Turnaround (verb) - improve significantly

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¹¹ The Cambridge Dictionary

© Eric Kish 2017

Print ISBN: 978-0-99853-101-4

eBook ISBN: 978-0-99853-100-7

All rights reserved. This book or any portion thereof may not be reproduced or used in any manner whatsoever without the express written permission of the publisher except for the use of brief quotations in a book review.

Contents

Heading Into the Storm

Observe-Orient-Decide-Act

Decoding Human Behavior

Culture By Design

Action

Everyday Turnaround

Execute

It’s Not Over Until It’s Over

The Tools

PI Reports

Acknowledgments

About the Author

The guy who hired me to do my first turnarounds was a smart guy. He’d give me, on average, 18 months to complete a turnaround and then overnight and without warning, he’d move me to the next one. I was not allowed to take any of the people I had trained and coached in previous turnarounds. I had to start from scratch with every new company.

Typically, I had little time to prepare for the next turnaround. I had to get my bearings fast and fly the airplane while it was being built. This meant that while discovering and developing assumptions, I needed to act in a way that would persuade the organization to follow. I also knew the day would come when I would suddenly move on to my next challenge, leaving behind a leadership team and an organization that could continue to fly the plane without me. This had been my routine for 10 years, resulting in seven successful turnarounds.

Doing these turnarounds, I experimented with various tools and methods. I was strongly inspired by the Kaizen practice of continuous improvement and later by Scrum.² A team-based approach to project completion, it was embraced by software development organizations after the Agile Manifesto was published in 2001. In fact, this book was written and published using a Scrum ritual.

The other pillar of my approach was discovering behavioral science and the tools that allow a leader to understand inherent employee drives and needs as well as how to align them with organizational roles.

Everyday Turnaround is about turnaround tactics. It provides a pragmatic view of the challenges a leader faces and the daily rituals that can be embedded in the muscle memory of the organization. It’s also about helping an organization’s people figure out how to row in the same direction, having each one fit naturally to the role while delivering continuous, fact-based improvement—all synced by an organizational heartbeat.

Everyday Turnaround is the result of testing the concepts in 12 turnarounds across seven industries on three continents over 18 years. It describes a fictional organization inspired by my own experiences; any resemblance to real people or actual names is purely by chance. The story emphasizes how agility is the key to the success of a turnaround while applying the Observe-Orient-Decide-Act concept developed by the military for its combat operations processes. Its approach helps you understand how to apply the principles and tools in a non-theoretical, real-world environment.

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² Scrum is an Agile framework for completing complex projects.

Mark had just wrapped up a successful turnaround when Will, his agent, called to say that Energon was looking for a turnaround CEO.

The lender had told Will that Energon was burning cash quickly and the board had recently fired the CEO. The company had no time for the typical national executive search and, frankly, it would be hard to find someone interested in joining a company in free fall. This dire situation had to be addressed—and fast—to save the company.

Energon’s lender was worried the company had no business leader in place to navigate the company out of the storm battering its operations. Mark wasn’t interested in a new job at the time, but Will insisted he should explore this opportunity.

Although he was a seasoned turnaround expert with an impressive track record, Mark had never worked in the energy storage devices industry. He knew boards typically prefer industry veterans.

Energon had been around for eight years. Started as an engineering shop, the company evolved into a technology innovator in energy storage devices.

Sales had grown fast, hitting $100 million in sales in only five years. Energon took advantage of the initial wave of adoptions of its devices by a first generation of applications, driven primarily by subsidies for renewable energy. In the beginning, the company enjoyed substantial margins. This prompted competitors to enter the market, which drove prices down.

Around the same time, subsidies for the sector started to be phased out sooner than expected. As a result, Energon’ s revenues dropped by 50% over the three years that followed.

This drop caught the company off guard, resulting in significant excess capacity and high fixed costs, which led to an extremely high cash burn rate. The former CEO convinced the board the drop was temporary and that the market would soon correct. But a reversal never occurred. By the third year, Energon had burned through much of its cash reserves.

The company’s lenders were nervous. Energon had only three months of cash left and the board, under pressure from these lenders, was forced to fire the CEO. He seemed incapable of grasping the urgency of the situation and taking action—fast.

Finding and hiring a new CEO wasn’t an easy task. Under normal circumstances, it would have taken six months to conduct a comprehensive executive search. But Energon didn’t have six months; it had three at most.

Internally, employee morale was dropping fast. Energon’s survival was at stake. That was when the lender suggested bringing in an interim CEO.

Mark Whitman was not new to turnarounds. If he got the job, Energon would be his seventh turnaround in 12 years. He’d been frequently retained as an interim CEO, tasked with taking a company in distress from the brink of bankruptcy to a successful recovery. His engagements lasted, on average, 12 to 24 months. Once the companies were on solid ground with a competent management team and improving finances, he’d move on to the next turnaround.

Mark started his adult life in the military. After completing two tours of duty in the armored corps as an officer, he went to college and graduated with a master’s degree in electrical engineering. This gave him the opportunity to start his professional career as a research and development (R&D) engineer and work on defense and aerospace projects.

Mark liked being an engineer for a while, but he moved into sales as soon as an opportunity presented itself. He was convinced that being on the revenue-generating side of the business would give him a new perspective.

He got his first taste of a turnaround when