Rescue Your Company from the Flames of Corporate Fires by Pamela Harper

Furniture World Magazine

Nearly every CEO and business leader has had to put out a corporate fire at one time or another. Whether it was a rush order that led to quality control problems or a cutback that left a major project understaffed, the end result was most likely the same -a tangled web of urgent unexpected problems that spread to other areas, causing the company's business strategies to grind to a halt. This phenomenon, which I call "strategic gridlock," happens with enough frequency that CEOs and managers in virtually every industry are being ushered to the exit door in record numbers. But can a corporate fire really have such devastating effects on a company? Most definitely. Many times what starts as a single burning individual fire sweeps through the whole organization and can even cause the stock to fall. For example, suppose your company is about to launch a new product, but you underestimate the demand. Orders begin to backlog. As more and more customers request your product, you put the pressure on manufacturing to keep up. In order for manufacturing to fill the ever-increasing number of orders, quality control begins to decline. The product becomes faulty. As a result, customer satisfaction levels decrease and sales begin to plummet. In the end, the new product launch is a flop and the company loses much needed revenue. What started as a simple miscalculation of demand led to the demise of a profitable endeavor. The reality is that too many companies aren't successfully planning their business moves. Whether they're merging with another company, entering a new market, changing their business focus or bringing in a new CEO, they're falling victim to unexpected roadblocks during the execution of their plans. However, by following some simple strategic thinking guidelines, they could eliminate these unexpected fires and greatly reduce gridlock in their organization. If your company is currently in the midst of a corporate fire or if you're preparing for an organizational change, the following guidelines, which I call UNLOCK, will help you put out the fire and keep others from occurring. 1. Understand the Challenge Many times, business leaders push what they think should work to solve a problem over what actually will work. But before you can eliminate a corporate fire, you first must understand the source of the problem. For example, if you're implementing a price change to increase product sales, you need to be sure the change will effectively address the real problem behind the sales slump. Is the product really priced incorrectly, or is it faulty or not timely for the market? While a new pricing structure may have worked in the past for what appeared to be a similar problem, the current situation may be due to a different reason and require a completely new response. Before rushing to a solution that may only fan the flames of corporate fires, it's essential to understand the challenge from more than one angle and uncover the assumptions behind your decision. 2. Negotiate the Buy in of Company Leaders and Stakeholders Everyone in your organization -from the CEO to the Board of Directors to the sales department- needs to have the same objective. Since these are the people who are going to be influencing others' opinions about the company, they need to truly buy in to any changes that are occurring or are about to occur. Too many times, business leaders confuse lip service agreement with true buy in. In this situation, people verbally agree to the changes, but then quietly continue with the existing way of doing things. This has the effect of sabotaging the change, fanning the flames of corporate fires and creating strategic gridlock. Involving key stakeholders early in the process of strategic thinking, exchanging mutual concerns and negotiating a joint solution will increase everyone's buy in and commitment to making changes happen. 3. Locate Cultural Strengths and Weaknesses Sometimes corporate fires start and spread because there's a clash between formal expectations and what really happens. Every company has a corporate culture -the beliefs, values and practices that exist within an organization. Formal cultural guidelines can be found in the company's mission statement, policy manual, employee handbook and procedures. However, each company also has an informal culture. These are the day-to-day practices that occur along with the formal culture. For example, a company may tout the importance of teamwork and positive reinforcement, but in reality, the informal culture, which practices giving criticism and not working across departments, forces employees to act differently. In order to put out a corporate fire, you need to know which culture prevails and whether it supports the goals to get the job done. 4. Organize Goals, Priorities and Actions Many times a corporate fire begins because leaders try to do too many things at once and don't organize the company's efforts. They're introducing new technologies, having a major hiring push and entering into a new market at the same time. No matter how well executed these initiatives are, they can fall apart when they're not balanced with the other changes that are going on within the organization. To keep a fire from occurring, there needs to be a priority given to each new endeavor and there needs to be ample time devoted to each project. Sometimes it's better to postpone one goal so that other more immediate problems can be solved first. However, when many changes must occur, it's important to develop a coordinating system that keeps people focused so the different goals and actions don't cancel each other out. 5. Communicate Credibly with all Stakeholders One of the most common fuels for corporate fires is lack of credible information. Very often when a change occurs in an organization, there's lots of information supplied up-front, but then it stops, leaving people to wonder exactly what is going to happen. Or a company may disperse the information in a way that's not credible for the stakeholders. For example, an organization may keep substantial information on their web site, but if people don't use the web site as an information source, they're not getting the facts they need. Additionally, if there is low trust in the organization, stakeholders may rely on other sources they feel are credible, such as the grapevine, to receive information. This not only fuels rumors, but it can also fan the flames of corporate fires by spreading misinformation, creating unnecessary fear and causing a breakdown of relationships. Communicating in the most appropriate and effective manner for your unique organization can totally eliminate many corporate fires. 6. Keep Adjusting Sometimes leaders stick with a plan even when the conditions for success have changed. For example, a key customer has changed their inventory system, but your company is committed to its now incompatible ordering system. Continuing to operate along a path that no longer applies is fuel for fire. No matter what change you're implementing, it's important to set checkpoints or milestones to evaluate your efforts. At those designated times, scrutinize the results to date along with the current circumstances. Stay focused on the big picture, but be prepared to adjust the plan if necessary. Since every company is different, there's no set timeframe for evaluating the initiative's effectiveness. You need to set the checkpoint at a time that's comfortable for you and that meets your company and market's needs. Business leaders often overlook these UNLOCK principles when planning their strategies and initiatives. Their mistaken belief is that in a "web speed" economy, these concerns are too time consuming or difficult to address at the earliest stages of change. Instead, they are left to smolder until they erupt in flames during execution. This doesn't have to be the case. Even a brief review of organizational reality issues during strategic thinking can help you take earlier control your plan's success. In today's rapidly changing business world, no company will ever be totally free of corporate fires or strategic gridlock. However, using the UNLOCK principles as early as possible can minimize the occurrence of fires and keep you from getting burned. About the Author: Pamela Harper is the founder and president of Business Advancement, Inc. (BAI), a firm focused on linking business strategy to high performance. Since 1991, BAI has worked with a wide variety of clients in mid-sized to Fortune 500 corporations. Her in-depth knowledge of the impact of organizational reality issues upon mergers, acquisitions, alliances, and high growth environments is based upon 20 years of working as an internal consultant within corporations as well as an external consultant. In addition to her work with clients, Pam is a frequent presenter of keynote speeches, seminars and workshops to executive and entrepreneurial audiences across the US. Look for more information about using the UNLOCK principles in Pam's forthcoming book: Preventing Strategic Gridlock: What Executives Need to Know to Move Their Organizations Forward. She may be contacted at (201) 612-1228, or visit BAI's web site at www.businessadvance.com