Rescue your company from the flames of corporate fires - Business

Hispanic Times Magazine, Summer, 2002 by Pamela Harper

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 looses 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.