Congratulations – you’re the new CEO of a business that is in the red and heading the wrong direction.

Every turnaround situation is unique and is a high risk and reward scenario with the jobs of many on the line.  And every turnaround has a common theme that the status quo was pushing the business in the wrong direction – the need to change was obvious.  Another common theme?  That the current situation is someone else’s fault; another department, the past leader, the dog who ate your homework…

The reality is it doesn’t matter.  Your task is to fix the business.  To do this you need to drop the politics and focus on the future.  You need people who you can trust, who have opinions, and can engage in constructive debates.

The best way to start the debate is with pointed questions

Assign these eight questions to leaders in the business and then bring the group back together for a couple of days of offsite meetings.  The hard part is getting past the finger-pointing.  A new leader has everybody jockeying for position and transparency is hard to come by.

One solution that worded behind expectation was when we brought a key customer into the strategy session.  While it was risky, it was the catalyst that brought honesty out.  We happened to pick the absolute right person, who for three days dropped his own identity and joined the team.

You need to be intensely honest in this assessment

These are the eight questions we answered over three days and led to the reversal of a share loss.  Could your business answer these today?

1. How do our products compare?
2. How does our price compare?
3. How does our cost compare?
4. How does our service compare?
5. How does our marketing compare?
6. How effective is our sales force?
7. How does our sales penetration vary by region?
8. Where should we rate in two & five years vs. competition?

The goal is to come out of the session with a clear picture of who you are, what you want to be, and where you are going to focus first.

Here is a scorecard  that we used to illustrate our intentions.

This is another post written with my colleague Doug Thompson, General Manager Rockwood Manufacturing at ASSA ABLOY.