Executives who take on the challenge of devising a corporate turnaround must face increasingly tighter deadlines to show results. But how much time should a comeback actually take?
Everybody loves a corporate comeback. They sure look good on a resume, too, which means that the prospect of a turnaround often lures executives to take charge of troubled companies.
But CEOs who do accept the challenge are on the clock in a way that they may not have been before. In a society accustomed to instant gratification, especially when it comes to a return on the money we invest, the timeline for turnarounds are shorter; everyone has access to more information, and they can monitor a company’s progress.
But how much time should a turnaround take? Of course, every company and turnaround is unlike, but in my experience, regardless of company size, here is what executive and the board should be looking for in terms of evident improvement and time frame:
- Within one quarter, a turnaround plan should be in place and initiated;
- Immediately after the plan is accepted by the relevant stakeholders, a common set of measurement metrics need to be implemented;
- Within the next 90 days, behavior and operating change should be evident to employees, customers and shareholders, improving morale and confidence.
- After two quarters, operating fundamentals should show marked tangible improvement.
The key to a solid strategy is not to just meet metrics, whatever those may be, but also to communicate why meeting those metrics is so critical. Secondly, who in the organization is responsible for the achievement of those metrics?