LEADERSHIP AND THE PSYCHOLOGY OF TURNAROUNDS

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LEADERSHIP AND THE PSYCHOLOGY OF TURNAROUNDS

• Rosabeth Moss Kanter

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THE DYNAMICS OF DECLINE

• Decline causes managers to dislike and avoid
  another, hide information, and deny
  responsibility
• Organizational pathologies arise and reinforce
  one another in such a way that the company enters
  a kind of death spiral
• Secrecy and Denial Blame and scorn Avoidance
  and turf protection Passivity and helplessness

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THE CYCLE OF DECLINE

• Corporate decline does not stem from a single
  factor. It results from an accumulation of
  decisions, actions, and commitments that become
  entangles in self-perpetuating workplace
  dynamics.
• Secrecy, blame, isolation, avoidance, lack of
  respect, and feelings of helplessness create a
  culture that makes an already bad situation worse
• Once in spiralgtgthard to stop
• But there are interventions that can shift
  momentum in the companys favor

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REVERSING THE CYCLE

• Not a one-size-fits-all process. What is best
  depends on the company
• 1. PROMOTING DIALOGUE
• Between employees, management, and the public
• Remove perceived distance between management and
  employees

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REVERSING THE CYCLE (2)

• 2. ENGENDERING RESPECT
• Build relationships between colleagues, groups,
  employees,,etc.
• 3. SPARKING COLLABORATION
• Across departments
• Across divisions
• Collective commitment
• 4. INSPIRING INITIATIVE
• To initiate actions that will improve the
  companys financial or strategic position

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THE ENERGY FOR CHANGE

• Leaders bring their own preferred approaches
• They restore confidence through empowerment
• They do a series of balancing acts
• As aspirations and performance improve and people
  gain hope, they get energized