Turn Your Business Around in 100 Days: Step 1

written by Bill Canady | Management Practices

October 2, 2023

You can turn your business around, positioning it to earn the right to grow, in four steps over 100 days. Step 1 is Set a goal.

“Set a goal!” Three words of what should be simple advice, but also three words that can create sudden paralysis. Some people are overwhelmed by the sheer range of possibilities, others are discouraged by the sheer range of impossibilities. This brief imperative sentence is in English. Respond in the language of business, which is the language of money.

profit and loss

Translate the current state of your business into revenue, profit, and loss. Do this for the recent past—use the data for at least the last full quarter—and the present. Then look ahead. If the trend is downward, you need to turn the company around.

Okay, but where do you need to go? Speaking the language of money, set a goal. In one turnaround I recently led, the whole-of-company goal we set was ambitious but feasible. It was to reach $2.2 billion in revenue, have 18 percent margins, and $400 million in EBITDA within three years. With that goal up in lights, Step 1 was done.

We set aside first 10 percent of our 100 days, ten days, to get that goal in place. Did we really need all ten days to come up with something that can be stated in a single sentence containing just three numbers? In fact, writing it down took about ten seconds, but preparing to write it called for getting a high-level view of the company’s performance and then asking questions of leaders at both the executive and operational level. That kind of walking around does take some time. Also, a goal is a whatwhat we must achieve. We also had to broadly outline a howhow we were going to win that goal.

For most businesses, the critical nub of the how is simplifying the business. Leadership must immediately determine what to stop, start, or continue doing immediately to get a solid foundation under the business. The key to this is applying an 80/20 Process, using data to decide where to simplify and thereby grow the business by discovering where to raise prices to increase your bottom line.

simplify business

But let’s go back to the goal itself. Where did it come from? Thin air? My … hat?

First understand that the most important thing about the goal is that it is a goal, which is something we didn’t have before. The actual numbers—$2.2 billion in revenue, 18 percent margins, $400 million in EBITDA within three years—are just numbers. Maybe they are precisely the right numbers. Maybe we could have come up with better numbers. I can say that at least they aren’t the wrong numbers because they are not facts but aspirations that have yet to be fulfilled as facts. They are good aspirations, ambitious but possible, even feasible, and perhaps even reasonable. The goal we chose makes a good target, and though an unaimed arrow never misses, it never hits anything you want to hit on purpose. So, the specific numbers aside, the goal provides a target, which provides a direction, which brings order where there was none and replaces panic with hope.

In this turnaround project, it was easy to see from glancing at quarterly reports that the company was suffering from declining financial results. I also saw a whole lot of projects and initiatives under way. The kneejerk response is to give three cheers. After all, doing stuff is better than not doing stuff. Right? And doing a lot of stuff has to be even better.

Well, not when most of the stuff is unaccompanied by strategic consideration of return on investment. Doing stuff costs money. The more stuff you do, the more money it costs. And it appeared to me that nobody was paying much attention to cash flow. Financial data, analytics, KPI, and tracking capabilities ranged from inadequate to nil. Tax issues, including addback limitations, severance obligations, and contractual cash requirements were all ignored even though they were contributing to an increasingly dismal cash situation.

The purpose of the goal was to introduce the strategic clarity that a quantified goal provides. The numbers in that goal may or may not be the best numbers, but they were sufficiently plausible to get us moving in a meaningful direction capable of turning us around. Once we could see that we were moving toward something, we could gather more feedback, more data, on the impact of the direction we were taking. Using the feedback, we could correct course as necessary.

So, within ten days, we had set our three-year goal. Based on historical and current performance, we had no reason to believe we could reach that goal, but we had a target, the numbers we needed to make in order to achieve our three-year goal. Possessing this goal demanded that we figure out our “go-get,” precisely what we needed to reach the goal.

The goal’s the thing. That’s why it’s Step 1, which is an imperative step beyond the panic and despair that are the products of inaction, that sense of not knowing what to do, that feeling of being unable to do anything.  For me, as a leader, the main purpose of Step 1 is to give the people something productive to do. I provide a direction. Sometimes, a big part of Step 1 is as simple as telling the team what has to be done to survive the next twenty-four hours. The boat is leaking. Hence, plug the holes. The house is burning. Hence, put out the fire. The numbers we put into the goal (the what) necessarily motivated a specific set of actions (the how): We will quickly cut spending and initiatives not tied to revenue generation. Having done this, we will laser focus on the investments and initiatives proven to generate revenue and that are the most important priorities for our success.

Step 1 is launched from the realization that to make tomorrow different from today, you must do something different today. The product of Step 1 is a rough sketch of the future, a tomorrow not just different from today but better. At the end of Step 1, you still don’t know all the details of all the changes you will be making in the days and weeks and months to come. But you, as leader, can promise the company that these changes will be tied to a proven four-step system, which takes three to four months to complete. By taking Step 1, you, as a company, begin to use the system, a set of principles and procedures that will guide everyone in doing what needs to be done to earn the right to grow.

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Bill Canady
Bill Canady has over 30 years of experience as a global business executive in a variety of industries and markets focused on industrial and consumer products and services.

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