5 Steps to Turning Around a Failing Business (2024)

He followed these 5 steps to right the listing ship.

1. Identify what went wrong. To figure out what happens next in any story, you must first go back to the beginning. The care you take and the pace you set here will be a defining moment for you as CEO.

2. Assess the current situation. Once you know what the problem is, you must make sure your employees and leadership are ready and capable for the next task: the turnaround. This is a combination of knowing which busses in your fleet are fit to drive and getting the right people on those busses! First I spent time understanding the strengths of the existing management team. I then spent time in the field, visiting manufacturing plants and other operations. I found ways to make quick improvements and effect change.

3. Invest in the team. A CEO must be compassionate to the team that will help him move forward. After my assessment and changes, I promoted some, created new job titles and, where needed, brought in outside help. With a dream team in place, I was able to move toward more complete investments for frontline employees. Investments included training, communications tools, recognition, pay and benefits improvements. I believe the mark of any great leader is to build a fully engaged team that will take you to new and sustainable heights.

“People need to understand what you stand for and where you are going.”

4. Change and update the company’s mission. People need to understand what you stand for and where you are going. Once I’d made the organizational and personnel changes, I tackled the antiquated vision statement. It read: “We will provide high quality fresh foods on a national basis. Our valued associates are innovative and driven to exceed the expectations of our customers and consumers.” As a team we changed it to: “We give people the freedom to eat healthier.” That new vision delivered a clear line of sight to what was expected of employees and the company.

5. Instill discipline and move forward at flank speed. One of the keys to turning around a company is installing new policies and procedures. These may seem onerous, but it is critical to adhere to them in a disciplined and accountable fashion. Simple, transparent, results oriented, and fast. These disciplines insure that the turnaround can stick.

As a result of this strategy, revenue at Ready Pac Foods grew for the first time in five years, and the firm achieved break-even status. In my first full year, revenue grew 10% and profits increased by over $17 million. These steps can help any CEO, new or veteran, make the shift required to turn things around.