We all have them. Some
are hidden in obscure
corners of a business; others are slung around the neck
like the proverbial albatross.
Much like barnacles that
build up on the bottom of a
boat, at first, they don’t cause
many problems, but as they
accumulate, they start to slow
things down and damage the
veneer. Every business has its
inevitable little messes
some self-inflicted, others created through being at the
wrong place at the wrong time.
It can be a bad hire who just
doesn’t get better, a less-than-stellar contract or a costly
piece of equipment that just
never performed as promised.
Like those annoying barnacles, they hang on and don’t
go away by themselves.
It’s just a matter of when and
how before you must stop
ignoring these issues. The
question becomes, is it better
to clean up all of these transgressions in one fell swoop or
endure the perpetual agony by
successively fixing each problem as it becomes unbearable?
How to handle mistakes and
missteps depends on a number
of factors, starting with, do you
own the business and report to
no one, or do you have investors,
banks or others to whom you
are accountable? Out of the
necessity of using OPM (other
people’s money), most businesses aren’t completely independent. It’s the old story about
investors and lenders: You
can’t live with them, but most
of the time, you can’t live without them or at least without
Nonpublic companies can
take a page from the playbook
of their publicly held cousins to
learn how they deal with their
big bloopers and blunders.
History shows us that most
public companies tend to take
their lumps all at once, employing a kitchen-sink strategy, ridding the organization of anything that doesn’t measure up.
Dealing with these issues is
much like having a terrible cold.
When you’re knee-deep in
cough drops, decongestants
and Kleenex and suffering with
aches and pains, you think that
the big one is coming, and you’ll
soon be on your way to that
special boardroom in the sky. A
week later, when the symptoms
have subsided, the good news is
that brush with the Grim Reaper
is all but forgotten.
Sure, public companies know
that when they launch the cleanup process, their stock will go
down, the media might trash
them, and investor activists and
class-action attorneys will likely
rattle their sabers. However, just
like that bad cold, if handled
properly, this too shall pass.
Nonetheless, by moving with
great dispatch and with a little
luck, the cathartic company will
be in a better position after the
housecleaning and when the
bumpy ride ends.
There is strength in numbers.
Frequently, stocks of companies
in the same business sectors
move down in sympathy with
each other. That’s why public
companies take advantage of
periodic economic dips because
they know they’ll have the necessary cover to make their
fixes. Actually, if a company is
one of the standout performers
in its group during tough times,
naysayers will assert that it’s just a matter of time until the
other shoe drops and the last
man standing (the company
performing well) is pulled down
with its peers.
For the unseasoned, all of
this may sound very cynical
and disingenuous. However,
the ebbs and flows in the business cycle are much like biology it’s just nature’s way of
cleaning things up.
When business is great,
almost no one thinks the trend
is ever going to turn bad, and
when it’s bad, nobody thinks it
will get better.
To be rid of your nasty little
problems, it gets down to making hard decisions. If you know
something will never work,
seize the opportunity at hand
and jettison the excessive baggage. Few mere business mortals are miracle workers and
can fix everything without
divine intervention. Learn to
leave those types of situations
to a much higher authority.
One caveat this cleansing
cannot be undertaken in a
Machiavellian, take-no-prisoners manner. Instead, have a
methodical, well-reasoned plan
that you share with your team
as you move through the
process of discarding the bad
and strengthening the good.
When possible, do it at a time
and place of your choosing for
the greater good of all of your
constituencies. The first step is
to stock up on an ample supply
of those cough drops and tissues to treat your woe-is-me
sniffling and then begin building
for a better tomorrow.
MICHAEL FEUER co-founded OfficeMax in 1988 with a friend and partner. Starting with one store during a 16-year span, Feuer, as CEO, grew the company to almost 1,000 stores worldwide, with annual
sales approximating $5 billion before selling this retail giant for almost $1.5 billion in 2003 to Boise
Cascade Corp. Feuer immediately launched another start-up, Max-Ventures, a retail/consumer products
venture capital operating and consulting firm headquartered in suburban Cleveland, Ohio. Feuer serves
on a number of corporate and philanthropic boards and is a frequent speaker on business, marketing and
building entrepreneurial enterprises. Reach him with comments at [email protected].