Years ago I had a boss that told me that as we approached taking over management of new businesses (that our company was acquiring), we would have to decide whether to be evolutionary or revolutionary. I wasn’t exactly sure what he meant so I asked him to elaborate.
He explained that almost every business we would be involved in managing would need to make changes to improve its performance because our company was only purchasing failing or struggling businesses. Every business would already have a management team in place, and our oversight as corporate asset managers would require us to make this important distinction.
As we approached each new business we would have to assess the business, its past and current performance, meet with management and staff and assess their competency and of course listen and evaluate their plans for their business unit. Once we had a good picture of the business, we would then need to decide whether change should be implemented through “slash and burn”, immediate and fundamental changes to management and business practices – Revolution! Or whether change could be implemented by working with existing management to help them understand, accept and then implement the changes – Evolution!
We generally worked the evolutionary process, which worked sometimes but failed miserably others. Usually failure was due to the operating unit’s management team being unwilling to accept changes and work with us. In thinking about the past, most of my regrets would be that we were not more aggressive – revolutionary.
Today, working as an entrepreneur with several new businesses I am often confronted with this same old question. My management team is slow to change and reluctant to accept advice, and at the same time is not succeeding doing things their own way. I try to work with them to effect change to help them and us be successful, but they resist. I am then faced with the question, do I clean house and get all new people or continue trying to work with the existing team? Cleaning house has a cost as it disrupts current operations and causes a loss of sales as it takes time to recruit, hire and train new management. Retaining existing management also has a cost as they are not performing, and the business is suffering.
I tend to work evolutionary and hope for the best, until like a volcano I explode when things continue to flounder. The explosion usually involves finally executing the revolutionary change that I had been putting off – replacing management with people that will perform along the lines that I believe are best for the business. Not sure this is the best approach, but it is the path that I typically travel. Maybe I feel it is more humane, not sure.
For those who are thinking this whole discussion is silly because they think the owner/boss should just be able to get his or her way and underlings should just fall into place, I would suggest that the world no longer works that way. Open up your new business, you’ll see!
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