Will the new leadership of a company be able to take on key responsibilities?

Changing the leadership of a financially distressed company may be inevitable. At this time,  critical questions need to be answered in preparation for selecting the new leadership that will hopefully lead the company out of financial distress.

The importance of this undertaking cannot be understated. If mismanagement was the root cause of the company’s financial distress, there would need to be a complete culture change. Balancing this with the fact that the company needs to implement measures to return to profitability is a tough ask for some managers and senior leadership.

I recently read an article which discusses some of the expectations that these candidates will have to deal with.

Set vision

The article points out that senior leaders are responsible for setting the vision for their organizations. They help people know, understand, and most importantly, feel excited about the direction of the organization. Once, the author of the article heard Brian Moynihan, CEO of Bank of America, be asked “What does it mean to be a leader?” Brian said, “It means I repeat myself a lot.”

Great leaders don’t mind being redundant in saying the same things, especially when it comes to the vision of the company. People want to know where the company is headed and what the path to future success looks like. The best senior leaders know it’s their job to repeatedly communicate about it — and in a compelling way.

Ensure and enforce mindset

The article adds that highly effective senior leaders know it’s up to them to ensure everyone has the right mindset. They spend time with their organizations and look for telltale (but sometimes, subtle) signs of who’s with them and who’s not. They know all employees need to believe in the organization’s ability to achieve its biggest goals, and also in their own ability to contribute to that success. Instead of blaming others, they look for people’s willingness to accept responsibility and own the outcome when things go wrong. They watch and listen closely to find out who is aligned with the vision, mission and core values and who isn’t. They look for examples of character and competence. They get their ears to the ground and find out what’s happening at all levels.

They do all this because they know that people matter, and without the right people in the right seats at the right time, they won’t be able to execute on the dream. I once heard that Steve Jobs would fire people who called something “impossible” or said “it can’t be done,” almost on the spot, because he simply knew how very toxic that kind of mindset was and how disruptive it was to the plan. Great senior leaders care for their company culture. They do so by evaluating talent at all levels on dimensions like these.

Create quality conversations and deliver clear communication

The article points out that exceptional senior leaders create dialogues everywhere they go. While they might be the “smartest person in the room,” they’re not smarter than the room. They know that others have perspectives and information they don’t have, and they need to create a secure environment to get it. They constantly put themselves and others in forums to get and spread information.

The author of the article pointed out that, several years ago, she worked for a commercial bank that had consistent “Voice of the Employee” and “Voice of the Customer” sessions so that employees could learn about the experience everyone was having. For her, it was critical to ensure that all types of customers and employees were invited to these, not just top-performing employees or our best and happiest customers. She regularly invited those I knew had grievances and wasn’t afraid to raise them. She believed this was how we’d get better. There were also constant town halls. The best executives repeatedly make a point to show vulnerability and humility, which was necessary for others to feel safe speaking their truths. Great executives don’t get angry or defensive when someone asks a tough question or raises a differing viewpoint. They crave these kinds of moments because they know they’re the gateway to greater engagement and trust in the future.

Spark leadership curiosity

The article adds that great senior leaders are constantly on the prowl for new ideas and information. They regularly seek out new research and data that applies to their industry, their competitors and the world as a whole. They’re innovative and adaptable. They’re proactive, not reactive. They don’t wait for a problem to become an emergency before they act; they act in advance.

As Wayne Gretzky famously said, “Skate to where the puck is going, not to where it has been.” Highly effective senior leaders devote strategic time, every week, to considering the ever-changing business landscape and what it all means for their company, their employees and their customers. They also recognize how important it is for their organization and employees to be constantly learning as well. They invest heavily in training, learning and development, and at all levels. They don’t just offer a curriculum that helps people do their jobs better, but a variety of offerings that helps how people think and interact.

Leadership must deliver results

The article points out that the best senior leaders are responsible for the results of the organization, period. When the organization isn’t delivering, it can be tempting to blame others — but almost always, it comes down to leadership. Strong executives take the blame when things go wrong and figure out what they can do differently. When things are going well, strong executives freely and openly give credit away to others.

As Harry S. Truman said, “It’s amazing what you can get done when you don’t care who gets the credit.” Truer words were never spoken. Great senior leaders ensure that everyone owns the results. They don’t so much “hold others accountable” as they help others hold themselves accountable. They create a culture where everyone understands that results matter and are driven to achieve those (the right way). They “showcase swimming” and lead by example by helping to manage and mitigate outside factors that might have an impact on the results early enough so that goals can still be achieved. They check in on the progress, early and often. They ask the right questions. They focus on what they can control; not what they can’t. As they model these things, they ensure the whole organization is results-driven.

It doesn’t matter what kind of division or department you lead. If you’re not doing these five things, you’ll struggle to help your organization become truly successful.

Willingness to change

The other component that needs to be taken into account is the willingness of the management and leadership candidates to take advice and act on it. The business rescue process is equal parts strategy implementation and guiding the company towards a new way to approach their operating model and risk management.

This is another critical factor in implementing any successful business rescue plan. Leadership is key.