The CEOs who are willing to “rush into the fire” when the company is in danger are all amazing heroes. Although the rescue of a company from its predicament is not something that can be done by itself, the courage and courage of the CEO will always be the focus of attention, and they become the man of the moment.
There is also a situation in which a CEO will face a long-established successful company when he takes office. These companies usually have beautiful balance sheets, a good reputation, and a solid market position. They tend to be comfortable with the status quo and are reluctant to make major changes.
Most of these companies are full of confidence. They are convinced that they have a winning business model and an invincible elite team; the company’s top management team has been acclaimed for decades; the deep-rooted behavior patterns have been repeatedly affirmed and praised. Within the enterprise, the “walls” between the various departments are high, the staff qualifications are growing, the political atmosphere is increasingly strong, and self-reflection and criticism are diminishing and diminishing. The general idea is: “Our company has been successful for many years, why bother to be too demanding?”
However, there is often only a line between self-confidence and complacency. We have seen time and time again that companies with strong performances have gradually entered a period of recession, and some have even plummeted in a short period of time. In fact, the life cycle of listed companies has now fallen to its lowest point in history.
How successful companies get out of the “comfort trap”
How should successful business leaders prevent problems before they occur, adjust their direction in time, and inject new vitality into the enterprise? Every company faces different situations, but we have found something in common from the winners:
Face the reality. A former BCG partner who had worked with Jack Welch, former chairman and CEO of General Electric, told me that he believes that Welch’s most important success is to ask for a company. The leadership always takes countermeasures according to the actual situation, not the ideal situation. Adopting appropriate measurement and comparison criteria, challenging questions, and tracking new products are all powerful ways to drive good companies out of their inherent “comfort zone”.
Establish a “urgency”. Successful companies often look for excuses to avoid change, because it makes them feel uncomfortable. As the pace of enterprise development slows, its vitality will continue to weaken. In the face of the ever-changing competitive landscape, corporate leaders need to put changes on the agenda and set the tone for them.
Avoid false security caused by “reliable veterans”. Indra Nooyi, former chairman and CEO of PepsiCo, shared this view as one of the most important experiences at a new CEO symposium. Just as a “reliable veteran”, managers can’t create a future for the company. They only know how to keep the past. To succeed in leading the business, CEOs must urge their leadership team to be a facilitator of change.
Resist “organizational rigidity.” Many successful companies face two interconnected challenges. First of all, due to the excessive internal level of the company, the scope of management and control is too narrow, the pace of enterprise development is forced to slow down, the organization becomes more and more bureaucratic, which leads to the disconnection between leaders and enterprises, the decision-making time is prolonged, and the employees with excellent performance will be Frustrated by excessive control and lack of authority. Secondly, as individual success gradually overrides team success, collaboration between employees is diminishing, a trend that is particularly evident in cross-departmental business activities.
To make such changes take root in the enterprise, leaders must first win the understanding and trust of all stakeholders, including employees, customers, investors, and regulators – let them understand why companies need to break through the status quo. And support this. The purpose of breaking through the status quo is not only to avoid the decline in performance, but to make the spirit of never-ending enterprising in the enterprise, encourage everyone in the enterprise to constantly try and achieve positive changes, let the company go on the way forward. It’s faster, more adaptable, and more flexible and agile.
Leaders who lead the successful transformation of successful companies rarely get to the headlines that people are competing for, but the value they create is breathtaking. Two successful predecessors, Frank Blake, former CEO of Home Depot, and former CEO of Bristol-Myers Squibb, Lamberto Andreo Lamberto Andreotti took over the heavy responsibility when the company’s performance was particularly bright, and helped the company to smoothly transform during the term of office, further consolidating its market position and adding up to nearly US$200 billion in shareholder value.
Only those extraordinary leaders dare to lead the company to leave the established path of success, open an unknown new journey, and make the company more confident and successful in the process.