LEADERSHIP AND THE PSYCHOLOGY OF TURNAROUNDS Rosabeth Moss

LEADERSHIP AND THE PSYCHOLOGY OF TURNAROUNDS Rosabeth Moss Kanter

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

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 spiral>>hard to stop • But there are interventions that can shift momentum in the company’s favor

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

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 company’s financial or strategic position

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