"Most corporate turnarounds fail before they start - not because of market conditions or flawed tactics, but because senior leadership fails to initiate the turnaround in the first place. Overcoming the psychological barriers that prevent change is the first impediment leaders have to overcome. Facing the fear of turnaround Corporate turnarounds used to be a rare occurrence, impacting companies that allowed themselves to fall behind over many years. Alternatively, a single, major disruption created a clarion call that motivated leaders to take drastic measures to turn the company's fortunes around."
"But today, the velocity of disruption has increased. Innovation is relentless, with information flowing faster, and tech becoming increasingly intelligent; companies have to contend in an environment that's shifting under their feet. So instead of a clarion call urging them to change, executives are hearing a series of low-grade alarms, constantly sounding and impossible to ever fully escape. Amid the noise of the market, poor performance becomes easy to write off as an excusable side effect of uncontrollable variables ("Performance was down because of tariffs" or "Profit targets were missed because of market cycles")."
"The truth is that, whether consciously or not, leaders avoid turnarounds because they're afraid of upending the status quo. More than a performance issue for company leadership, turnarounds have become a psychological one; you can't lose a race you never started, and you can't fail a turnaround that never happened. "Turnaround" is taboo amongst some leadership teams: declaring the need for a turnaround starts the clock on executives and puts a target on their backs. It's a bold declaration (and admission) that things are off track. And in today's executive leadership landscape, that can be scary; executive turnover is at an all-time high, and activist investors have become increasingly capable at exerting change."
Most corporate turnarounds fail because senior leaders do not initiate them, blocked by psychological barriers. The pace of disruption has accelerated, with faster information flows and smarter technology, creating constant low-grade alarms rather than single clarion calls. Executives frequently attribute poor performance to external, uncontrollable variables, allowing underperformance to persist. Declaring a turnaround creates accountability and risk for executives, making the term taboo among some leadership teams. High executive turnover and more capable activist investors amplify leaders' fears of admitting things are off track and prompt avoidance of decisive change.
Read at Fortune
Unable to calculate read time
Collection
[
|
...
]