More thoughts on businesses in transition... or Part Two.

The following is the original and the rewrite can be found by clicking here.

Recently I wrote a blog on businesses in transition and quickly discovered that the topic was much bigger than a 500 to 750 word blog. In the spirit of what I started, this is the second in a series of thoughts on transition.

Transition (the noun) is defined as the process or a period of changing from one state (or condition) to another*, and with respect to business, I will say this is a constant state... the exception I suppose is when a business is stagnate (showing neither growth nor decline). Even this stagnation though will tip either towards growth or decline in time, and return the business to its natural state of change. BY DEFINITION, A BUSINESS IS ALWAYS IN TRANSITION... sometimes fast and sometimes slow, but always transitioning, one way or another.

One of the considerations that I put forward was Business Transition due to internal factors.

As a working definition, this transition and change in the organization is driven by internal activities and initiatives by leadership and employees to build a more viable and successful business. This is the transition that conjures up the images of people like Jack Welsh, Andy Grove or Steve Jobs whose leadership and vision created great companies and brands (not to mention a great PR machine that made them household names in business).

There are a number of elements that are needed to support this type of transition successfully but unfortunately often get forgotten or dismissed when the organization is small, or if the organization is large, can be unwieldy, administratively onerous, or make the organization slow to react to what's happening outside the company.

 

The first two elements are components of planning; the development of long term and short term plans.

The long term plan looks at the direction of the organization over the next five years... this is the strategic plan that ensures the organization is aligned with its vision, and keeps an eye on longer term goals to ensure short term activities have the evolution of the organization heading in the right direction. 

The short term plan looks at the next year and is very tactical regarding what needs to be done, how it will be done and what is measured to ensure success. This safeguards that the organization continues to drive activity in line with what it wants to do. In many cases the short term plan is part of the iterative process to get to the longer term goals.

Discipline is needed to ensure that the planning process is part of the business calendar, is properly resourced, and is actively communicated throughout the organization as a priority. Experience has shown that there are two critical components to the planning process: 

• A framework and process for planning: This will offer focus, context and a process for thinking when people meet around the table. I have always liked the McKinsey 7s model, and although a little long in the tooth, it has always worked to keep everything on topic and moving forward.
• A facilitator: You need someone designated to manage the planning process and ensure you end up with the deliverables... this also allows leaders the white space to develop their thinking, instead of focusing on the process.

 

The third element is the review of the people in your organization.

This is extremely important because people "run everything".

The only reason that this is not number one on this list is because you need to know what you are doing (and where you are going) before you can think about the people needed to help you. Every person in the organization should be assessed regarding skill sets, strengths, and weaknesses, so you can understand the capability of the people in the organization. This guides hiring, development, exiting, promotional opportunities and the skills (and people) needed for the future. This review is done at least once and year and supports the long and short term planning.

 

The forth element is having robust operating mechanisms to manage the business.

In other words, have a project and meeting calendar to execute the plans, and manage the workings of the business in an organized and on-going way. There is always a balance needed between not enough projects and meetings and having too many projects and meetings; in both cases nothing really gets done. What you are looking for is the perfect number of meetings and projects to successfully get things done... there are two main contributors to being effective, and that is leadership and having the resources available to get things done.

The fifth element is having as much transparent communication as possible.  

There are two aspects to this - 

• Communicate the vision, the plans, what needs to be done, how things are going, etc. as much as possible.
•  Work out the mechanisms as to how you are going to get your message out there and as deep into the organization as possible (town halls, quarterly reviews, team meetings, 1:1s)

The six element is a culture of urgency, meritocracy, respect, and curiosity.

This is the formula for success in my experience.

Can any of this guarantee success as you transition your business... unfortunately not. Although, not doing it, can almost guarantee difficultly through the natural transition of a business. And this isn't even before you consider external and revolutionary transition.

Not to worry, we will get to that soon enough.

iamgpe

Thoughts on a business in transition... the first of many it seems.

The following is the original and the rewrite can be found by clicking here.

Recently I have been having in depth discussions with a colleague of mine regarding businesses in transition, what it means, its impact, and how our backgrounds offer a unique perspective on this topic; particularly on the commercial side (Renee is quick to remind me that Sales and Marketing is much clearer than saying "commercial"; this is another point of discussion). Call it Commercial or Sales and Marketing, we definitely can offer insight.

Transition (the noun) is defined as the process or a period of changing from one state or condition to another*, and with respect to business, I will say this is a constant state... the exception I suppose is when a business is stagnate (showing neither growth nor decline). Even this stagnation though will tip either towards growth or decline in time and return the business to its natural state of change. BY DEFINITION, A BUSINESS IS ALWAYS IN TRANSITION... sometimes fast and sometimes slow, but always transitioning one way or another.

There are four considerations that come to mind when it comes to transition that frame up the real world aspects of dealing with it:

Transition due to internal factors - Transition and change in the organization driven by internal activities and initiatives by leadership and employees to build a more viable and successful business. An example of this would be the implementation of a new CRM system for the sales force to manage customer opportunities and increase revenue.

Transition due to external factors - Transition and change in the organization driven by external forces that impact how the company conducts business. Examples of this can range from new government regulations, through new competitive products, to the countless changes that can happen with the customer's ever changing expectations. 

Transition by "evolution" - Transition and change that occur at a controlled pace as part of long term strategic planning, the companies goals, and market considerations. 

Transition by "revolution" - Transition and change that occur because of a dramatic event... either externally or internally. A merger or leadership change (with very different philosophies) represent the more colourful examples of transition by "revolution".

It was at this point I literally looked up from my computer and asked myself, "Do you really believe you can tackle this topic with a 500 to 700 word blog post?"  I will definitely need more words and future posts, and with that said, I will lay the foundation regarding a business in transition by saying,

"Transition in business is a natural state that is under constant influence by external and internal factors, and it is the responsibility of leadership and employees alike to manage this as proactively as possible... ever prepared to deal with the change of revolution" 

The gauntlet has been thrown down... I will organize my thoughts on a business in transition, particularly with the commercial function, and tackle it with gusto 500 to 700 words at a time. I invite my colleague Renee Cormier, as well as anyone else, to offer insights on a business in transition.

Because in a very practical sense, it will touch us all throughout our careers.

iamgpe

* Thank you internet for one of the many definitions.

Mergers, acquisitions, and the inevitable "integration".

The following is the original and the rewrite can be found by clicking here.

If you are in the private sector, particularly in a public company, I can say with great certainty you will go through a merger or acquisition sometime in your professional career... and probably more than once. I've gone through no less than seven, and that is not including the various acquisitions "just for the technology".

I will defer to the Directors, Investment Bankers and Lawyers to offer up the subtle differences between "a Merger" and "an Acquisition" as it seems there is always someone in the equation who was doing the "acquiring". Semantics aside, there is always an integration of one organization into another... what used to be two, is now one.  

Unless you are part of the aforementioned group, more often than not you will find out about the "merger and/or acquisition" through a press release, a company wide email or if you are really lucky, get called into someone's office and given a heads up 30 minutes before "something is about to go down". No one integration is ever the same in my experience; all having different rules of engagement and scenarios with no standardized check list to help get you through it. 

At the very most, I was able to come up with three guiding principles over the years that have served me well.

There will be CHANGE, and there will be OPPORTUNITY.

This is a truism (and quite possibly a universal law) that may or may not be to your benefit, advantage or convenience when it comes your way; you may be able to influence it or even champion it, but in the end, you will have to manage it no matter where it takes you. I was introduced to the book "Who moved my Cheese by Spencer Johnson" many years ago during my first integration; I encourage everyone to read it at least once. It is an excellent book on managing change.

You will hear the phrase, "Business as usual" to be sure and this is a very true statement; it does carry the presumption that everyone internally understands that there is an accelerated need to manage through transition and that any subsequent changes don't negatively impact the customer experience. From an external perspective it needs to be business as usual, but do not assume that applies internally.

It's wasted energy trying to rationalize that change will not touch you, and more important to focus your energy on how to effectively manage through any change and opportunity that will present itself. If you are thinking, "My function is too important to be impacted", or "We bought them so they will have to do what we do", or "We are doing really well so there this no way they will change how we do things", or the countless other ways we rationalize that things will not change... you need to stop and refocus your thinking.

CHANGE and OPPORTUNITY are coming.

Synergy, restructuring and unfortunately good people will leave.

A Merger and/or Acquisition poses the question, "How can the new organization be run more efficiently to reduce costs and increase revenue?".*

• Revenue synergy (more revenue as a result of the merger and/or acquisition)
• Cost synergy (cost savings as a result of the merger and/or acquisition)

This is the reality of business... reduce duplication and inefficiency to increase profits. This is the birthplace of all that change, the resulting restructuring, rationalization of two departments into one, and the reduction in duplication of resources.

More often than not, restructuring and the search for synergies is not an overnight event. You will be part of the process as you manage "business as usual" and directly or indirectly restructure for the future. Like it or not, inevitably good people will leave... either out of the organization or to a new opportunity within the new organization.

No matter how much change there is, an organization doesn't want to lose good people because there is just so much work to do... be open to where restructuring and opportunity may ask you to go.

In the end, all you have is your Leadership and your Character.

The question you have to ask yourself is what does "Leadership and Character" mean to you and what will it look like as you work through the dynamic and difficult times that are often part of any Merger and/or Acquisition. You represent yourself during these times... no one else.

And remember people are watching, that they are also managing through the same change, and they have most likely been asked to make difficult decisions.   

My recent merger and/or acquisition experience ended up having me saying goodbye to a company after twenty-two years... on good terms, with a smile, a tear, and a handshake. What an amazing ride to be sure. I made a point of passing on these guiding principles before I left to anyone who would listen. Alas, that wasn't as many as I had hoped.

iamgpe

* I would suggest a business interested in staying modern and viable always needs to be asking "How can the new organization be run more efficiently to reduce costs and increase revenue?"