The turnaround CEO is a well-known phenomenon, sailing in to rescue
companies from perilous straits. Lou Gerstner, Jim Kilts, Steve Miller
and many other CEOs made their reputations (sometimes infamously, as in
the case of Chainsaw Al Dunlop) by righting—or at least temporarily
Turnaround CEOs tend to share a few traits: They are extremely
decisive and fast; they are tough-minded, unhesitatingly laying off
large numbers of people and slashing company assets; they are astute
with finances; and they are outstanding communicators who can quickly
point a new direction for bewildered employees and angry stakeholders.
The communication skills of turnaround CEOs (first noted by
Harvard Business School professor Rosabeth Moss Kanter) play a large
part in their typical modus operandi:
to swoop in with great fanfare, announce that everything is on the
table, quickly collect information and make decisions to alleviate an
immediate crisis, and then look to the long-term health of the
organization. Turnaround CEOs don’t spend too much time on the last
point of that program; they tend to move on after six to 18 months.
Their work is done. . . time to ride off into the sunset.
A similar but less famous handyman (except in the pages of CIO
magazine and CIO.com) is the turnaround CIO. A few specialists, by dint
of skills, personality and probably a good dose of luck, have become
known for reversing desperate situations in IT. How do they do it? This
magazine has written about the seven rules of
turnaround IT management and the four-step “basic formula” for turnaround CIOs. They are, respectively, and in brief:
- Get out of the office
- Stop the bleeding
- Find your biggest problem and fix it pronto
- Conduct customer surveys
- Find out where the profits are
- Talk the talk
- Base IT investments on ROI
- Survey the beast—that is, diagnose the problem
- Draw your sword—make it clear that all projects and jobs are up in the air
- Dig in—quickly set up new governance mechanisms, drop projects and fire people
- Bask in glory—bring home some quick wins
These plans look similar to the techniques of turnaround CEOs. But
don’t be fooled into thinking that CIOs can act just like their bosses.
I believe that turnaround CIOs have it much harder than their CEO
Consider that CIOs never have a completely free hand. Even when
they’re expressly tasked with fixing a broken IT organization, the
lines between IT and the business side blur; a turnaround CIO’s plans
are bound to run afoul of the interests of some other executive.
Turnaround CIOs are vulnerable in a way that CEOs never are. These
days, the easiest thing for the boss to do with an IT mess is call in a
consultant and outsource the staff.
Charlie Feld had it right when he was head of The Feld Group,
the noted CIO-for-hire and turnaround consultancy that was acquired by
EDS in 2004. He was independent, experienced and armed with a stellar
reputation. His fee alone made his CEO clients sit up and listen. If
they failed to implement all of his suggestions. . . well, on to the
next “hairball,” as Feld liked to call turnaround situations. An even
better situation was enjoyed by Tom Smith, former CIO of Waste
Management, who formed a two-man turnaround team with CEO Maury Myers.
He had the ear and the trust of Myers as they moved from mess to mess.
For every other would-be turnaround CIO, here’s some advice.
You need all the characteristics of turnaround CEOs—decisiveness,
toughness, communication ability and financial acumen—plus one other.
You must be incredibly, incessantly politically astute. This is not a
skill often credited to CIOs, but in turnaround situations, your
success, and quite possibly the survival of your IT department, depends
Leading Questions is a regular column about leadership and
management issues. Executive Editor Edward Prewitt welcomes your
feedback at email@example.com.