Turning around a sick business is not for the squeamish. I have always thought business is all about identifying an opportunity, going after it with single minded focus and winning. Now I learnt that business is all about managing tensions. Short term vs long term. Customer vs Competitor. Employees vs Investors. Investment vs. Debt reduction. Derisking vs. Focus. The list can be endless. All those who swear by teams, making nice and collegial culture, have never worked in a sick, family business that was struggling to survive. Imagine a business which has just lost its biggest customer (who gives you more than 80% of your revenue); imagine a business where the founder has taken all the cash out of the company for personal use and invested nothing in marketing, sales or people. Imagine a business whose products have no competitive advantage whatsoever. Imagine a business where people are so used to living in the shadow of founder that cannot/do not recognize reality unless it sneaks up and puts a knife to their throat. If you are handed such a business; a business with $5000 in bank; $1.2 million due immediately and whose star employee and biggest customer just left. If this is your family’s business where closing it down is not an option since it would put half your family members (who are not qualified for anything else) on the street; does any business school prepare you for something like this? Hell, does any business school even begin to address cases such as this?
For the past 18 months, I have been leading such a business. For the past 18 months, I have been losing my illusions one by one. For the past 18 months, I have seen a business, a team, a family go through the crucible of bankruptcy and emerge. For the past 18 months I have seen heros break and victims grow a backbone. Personally, I have been slapped with all kinds of adjectives starting from savior to jerk; brilliant to incompetent; sensitive to heartless; savvy to ignorant. Everybody, starting from the founder to the sales person had at one point of time or other railed against me because I did not give into their demands or demanded performance from everyone. I have had people tell me that I have no clue about how to do business; that all I am interested in is how much the sales are; I am a miser when it comes to spending money on marketing; I am too generous when it comes to spending money on people; I take too many risks; I take too few risks. Reading all this, you would be justified in thinking that the morale in my company is shot to hell, we are flogging a dead horse, and/or I have a team that does not get with the program.
You could not be farther from truth.
In the past 18 months, we grew by 60% on annualized basis; grew our headcount in sales; cleared all debt; generated a cash reserve of $500, 000, have a team that is raring to go into a new country (see here), take names and kick ass.
As the CEO of the company, my job is not be the nice guy or be the tough guy. I have to make sure that things get done; if it needs me to be tough, I have to be tough; if I can get it done with a nice word, I am happy to oblige. The point is to realize that I am not in a beauty contest; it is more like a tight wire contest; if being nice helps me walk the tight wire better, sure I’ll go for it. The key is to manage the tension; not eliminate it altogether. If you think you can eliminate all the tension that comes with the territory because you are nice, cheerful and capable, you are kidding yourself!
Does coming out of the wilderness make your job any easier? Hell no! I am still served bouquets and body-blows in about equal proportion. But the funny thing is now everyone is getting into the act. Every one starting from the founder to the warehouse operator to the members of our fiercely independent sales network make it a point to criticize me and advise me on how the game is played. Now every single person involved with my company has something to lose; so everybody has a stake and an opinion. Which is exactly how it should be.