When a person has a traumatic event happen in their life there are six stages they go through: shock – denial – anger – blame – depression – acceptance. These six stages could also be applied to what many CEOs, presidents and business owners have experienced when operating a company during a business turnaround cycle.
There are three additional stages that need to be added to this list for a successful business turnaround. They are: 1) survival – 2) stability – 3) profitability.
- The first stage of any business turnaround is survival. It’s important you – the CEO, president or business owner – get in action fast to evaluate the business situation as quickly as possible to survive. It may personally infusing cash into the business, putting a freeze on hiring, realigning product or service offerings, etc. Anything that is legal and ethical to keep the business going.
- Once through the survival stage, next is stability. This is when the company reaches a plateau as business has not yet returned to normal but business results encourage you enough to know the company most likely will survive. You can see actual progress being made toward turning the company around.
- The third stage of a business turnaround is profitability. As the CEO, president or business owner you’ve had to make radical changes to your business thinking and business operations as you moved through stage one: survival, and stage two: stability.
As the company, overall, slowly improves; as the efficiency and the sales efforts of the company improves, a timetable can be determined marking the return to a more normal, every day business flow.
Although you may prefer to skip these individual steps (which include many details too numerous and individual to list in this article) and move immediately to profitability, it’s necessary to go through all three steps, one by one, to have a successful business for the long term.
To your success!
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