Staying Alive

This will be the third post in an unintended trilogy following my last two on why companies that might appear to be “built to last” may suddenly evaporate before your eyes. In response to those stories (Gone So Soon and 8 Warnings That Your Company Is Toast), I received several inquiries wondering if there were ways to spot an imminent mudslide while there’s time to escape.

Executive turnover is something to watch closely, especially the C-suite. Either too little or too much turnstile rotation can be a warning sign. With no leadership change over long periods of time, a company might become entrenched in its plodding, convinced it knows how to do things so well no seismic shift in the landscape requires reinvention of the company’s ways. When executives are repeatedly jumping ship in under a year, the lack of stability in teamwork, embrace of new ideas, or core strategy might be signaling a torpedo crater in the ship’s hull that can’t immediately be seen underwater. Certain presidential administrations come to mind.

An escalating executive dump of equity holdings will usually light up an analyst’s eyes, but what about yours? If your top management is seeking liquidity while proclaiming they are simply reducing concentration and balancing their holdings, ask yourself why now. It’s good to be loyal when there’s a reason to be loyal. Ignoring the siren to go down with the ship will never seem as noble when your colleagues have departed in first class and you are left treading ice water. Much of the dot-com bubble unraveled this way, with most of the stock prices dropping swiftly to zero.

Ever sit in a meeting, listen to a colleague or team of co-workers present an innovative, visionary solution to a core concern the company has long identified as critical to its survival, only to see the framers of the big idea summarily dismissed without adequate explanation? Sure you have, most of us have. Perhaps those framers then quit, go across town and put their concept to work for a competitor, of course without violating their nondisclosure or trade secret agreements, modifying their ideas to a variation on the theme. If you believe they are as smart as they think you are, consider following them. That’s how companies like Intel started.

Do you observe evidence that your company understands its core competency, protects it through a culture of learning, and openly admits its weaknesses as opportunities for improvement? When you go to an offsite, is the point of that retreat an honest evaluation of the company’s strengths and threats, or is the current leadership pontificating on how unlikely it is that your competitors can take your market share? Sears has been dying for decades. I wonder when in each of the past years they thought they were winning.

Are you building a project or a company? A lot of people aren’t sure. Most startups begin with a product offering, but if the company building that product defines itself too narrowly, it may soon cease to be a company when it is folded into a larger company with a lot of “synergies” found in the combination. If the word “synergies” doesn’t ring a bell for you in the world of mergers and acquisitions, it usually means overlapping functions that are removed as redundant costs, possibly you. Look at the string of product builders that companies like Microsoft and Google synergized throughout their history. How many of them can you still name?

Are analytics, diagnostic evaluation, empirical assessment, and primary research core to your company’s self-evaluation? Are key decisions made on gut instinct or debated with facts? Ask yourself if that’s what the top leaders in your company say they want to do or if it’s what they really do. That which gets measured gets done. That which gets quantified gets fixed. If you’re in the room where people are swapping stories rather than interpreting data, you’re probably better off gambling in a casino where the odds are at least known.

Another way to think about this is whether you believe top management in a company is truly focused on staying alive, and whether you can help overcome the challenges to a company you love or want to love. If the decision-makers around you are people you trust who are committed to vetting solutions, perhaps you can be as well. Too often when the axe falls, we acknowledge in hindsight what we should have applied in advance thinking. There are artifacts of knowledge all around you—both positive and negative—if you choose to pay close attention to the reality of your situation.

You can always be pleasantly surprised or devastatingly rocked by good or back luck on the job. Predicting the likelihood of an outcome is a learned task that is likely more tangible than you think.

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3 thoughts on “Staying Alive

  1. Pingback: Staying Alive – Motivational Moments

  2. Dr.Stantz to Dr.Venkman.. “Personally, I liked the university; they gave us money and facilities; we didn’t have to produce anything! You’ve never been out of college; you don’t know what it’s like out there. I’ve worked in the private sector; they expect results!”

    In my world, our product is suppose to be the health of our citizens. If I sat at a retreat trying to envision what that really was and how it should look, I’d be pointing to a Rube Goldberg design with no vision for the end-product. And since no one seems to know what the budget for that product is, I would start there and see if we can determine how to get a handle on costs. The problem of course is it is funded mainly by tax dollars; enriching many under the guise that their part of our Rube Goldberg machine is “essential”. What we need is a good CEO that sees this bloated and mired corporation with many unnecessary but well entrenched institutions that need to be greatly re-purposed; make the painful decision to upset them all, and force them to work in the interrelated way they should. Rather, they react like the guy who bids 1 in Spades and then trumps his partner but justifies by saying…”Well, I got my one”!

    Liked by 1 person

  3. One of the key activities of strong business leadership is to identify high cost/low value activities in an enterprise and either reform them or replace them with reasonable cost/high value activities. Because the backbone of healthcare in the US is for-profit insurance companies (high cost/low value) rather than the medical professionals themselves, we have created a gateway to policy approved healthcare rather than an access model to warranted necessary healthcare.

    Unfortunately that inserted middleman system is deeply entrenched in sustaining its own exploitation and siphoning of dollars, forcing a game of price inflation/adjustment with true medical professionals. It also creates a labyrinth of opportunities for manipulation and abuse. The complexity of solving this is vast, but not not impossible, and will happen in the next 100 years out of necessity. We have to start with the question of whether healthcare is a business for-profit or a human right and public service. The system we have is economically unsustainable, which ensures reinvention will have to occur.

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