Team Turnarounds: A Playbook for Transforming Underperforming Teams

To our friendship,

our wives, our team

Foreword: Adversity Introduces Us to Ourselves

What do NFL teams, a Broadway musical, a university childcare center, a pizza maker, a public school system, a motorcycle trailer manufacturer, a collegiate lacrosse team, and a state all have in common? Stumped? They, and other equally fascinating organizations, are the case examples in Team Turnarounds, a highly entertaining and enlightening read about very diverse organizations that shared one common problem: they were all failing or floundering and needed to reverse course.

Because of the sheer breadth of their examination, it’s hard to imagine how Joe Frontiera and Dan Leidl could pull this off. But they have—and to great effect. These stories are so well narrated that you’ll think you’re reading an edge-of-your-seat detective story. And Team Turnarounds really is like that in many ways. Here are tireless leaders who face severely vexing challenges and puzzling situations—many of which they and others have never before encountered. And these leaders are refreshingly honest about the realities of life in organizations that aren’t performing up to expectations. That life can be embarrassing, depressing, exhausting, and heartbreaking. Yet, at the same time, it can also be exhilarating, uplifting, meaningful, and rewarding. It all depends on how you view the challenge.

While reading this book, we were reminded of a comment made by John McDonnell, former CEO of McDonnell Douglas, when that company was going through its struggles before eventually merging with Boeing. Adversity introduces you to yourself, he said, reflecting upon what that struggle had brought for him. And we recalled another thought from Randy Melville, whom we interviewed when he was with Pepsi. Quoting his Princeton University basketball coach, Pete Carril, Randy said, Adversity doesn’t build character, it reveals it. Challenges, difficulties, setbacks, adversities—they are all familiar sights on the leadership landscape. And one of the things that they cause us to do is come face-to-face with ourselves. They are a rather harsh way of reminding us of what’s important to us, what we value, and where we want to go.

Leaders are no strangers to challenges. In fact, exemplary leaders thrive on them. Team Turnarounds offers you the hard-earned lessons learned by the amazing people who led the transformations. And Joe and Dan have done an exemplary job of pulling these lessons together in a way that is not just applicable to the folks in the book. They show us how these lessons are applicable to all of us, and how they are especially useful during the turnarounds we are now dealing with, or will inevitably confront, in our organizations and our lives. There are lessons in here about the importance of values and visions, about commitment and meaning, about teamwork and relationships, about resilience and positivity, about initiative and commitment, and about courage and heart.

But you don’t have to wait for things to get bad on your team or in your organization to benefit from Joe and Dan’s insights and practical wisdom. Filled with fresh, revealing examples from sports, business, education, retail, and large and small organizations, the examples are illuminating in their depth and take-away applications. You and your entire team will benefit from the book’s Team Turnaround Workbook—it alone is worth the price of the book. You’ll find essential questions you must answer, tasks you must complete, and preparations you must take to successfully reverse the course of a losing team, a failing company, or a stalled initiative.

Team Turnarounds is, in the end, a book about hope. A book about how you can mobilize others to transcend the present difficulties, bounce back from failures, and reach for greatness. It’s a book about the power of the human spirit. Enjoy.

Jim Kouzes

Orinda, California

Barry Posner

Santa Clara, California

March 2012

Introduction

MICHIGAN FALLING

In 2009, the state of Michigan was in a downward spiral. Statewide, it was hemorrhaging jobs, and unemployment offices were receiving 800,000 to 1,000,000 calls per day.

Governor Jennifer Granholm, then in her second term, recalled, In our unemployment offices, people were in line down the street. [There were] people [who] had never collected unemployment before. The system was like a cancer patient that was breaking down everywhere.¹

Granholm had reason to be concerned, and as time went on, the situation only worsened. Moreover, she had long believed that Michigan’s manufacturing culture was working against the situation.

People were so used to boom-or-bust cycles, she lamented. They knew that historically, when the nation was in a recession, Michigan had deeper troubles because people weren’t buying large consumer products, like cars.² And when the manufacturing industry that had once sustained Michigan’s economy began failing, the shift was catastrophic, and the damage was unprecedented.

Toward the end of her first year in office, Granholm had traveled to the 8,000-person town of Greenville, Michigan, after learning that Electrolux, a refrigerator manufacturer that employed 2,700 people, had made plans to uproot its operation and move its plant to Mexico. In her typically confident way, she teamed up with the mayor, the local chamber of commerce, the company’s union representatives, and others to construct a comprehensive plan to get Electrolux to stay. Granholm’s team members met with executives from Electrolux and presented them with an extraordinary package, laden with concessions and incentives that they thought no business could refuse.

We offered them zero taxes for twenty years. We offered to build them a new factory, $30 million in concessions annually, and a $750 million package over twenty years. It was the most aggressive we had ever been—that Michigan had ever been.³

It was a good deal, and the team members knew they had done their best to keep Electrolux in the region.

After the presentation, the Electrolux executives left the room to confer. About fifteen minutes later, they returned.

As Granholm recalled, one of the executives began, This is really generous. We have never seen an offer like this. But, he continued, there’s nothing you can do to compensate for the fact that we can pay $1.57 an hour in Mexico, so we’re moving.⁴

With that, Electrolux was gone. Electrolux had manufactured its last refrigerator in Michigan, and another Michigan community was left devastated.

Shortly afterward, the stunned citizens of Greenville held what they called a last supper, a picnic at Klackle’s Orchard Pavilion, a local indoor facility. The town was convening both to remember the past and to make sense of the present. Granholm attended the picnic.

It was like community grieving. … People could not believe that their whole identity had been stripped, and not just their identity but their livelihood.⁵

One worker approached Granholm with his two young daughters. He relayed how his grandfather, his father, and he himself had all gone to work at the plant right out of high school. With his daughters looking on, he lobbed a hard question at Granholm: So, Governor, who is going to ever hire me? Granholm heard the emotional appeals of hundreds of families that night, all asking similar questions. She stayed until the last person left. Then she went home and cried.

Thousands of workers now needed to find a way to feed their families. Crushed though Granholm was, she also began to realize that the people of Michigan needed to change their mind-set—specifically, the ingrained belief that if they simply continued to do what they had always done, they would somehow turn things around and bring jobs back.

We had 10 million people, she said, and it takes a long time to get a whole cultural paradigm shift into people’s mind-set, and sometimes you could hit bottom before you fully acknowledge, ‘Yeah, we needed to change.’ ⁶

Michiganders would have to look to new industries, try new ideas, and shift the focus away from what once had worked to what could be done differently. They had to change, and they didn’t have any time to waste.

TURNAROUNDS IN THE MODERN LANDSCAPE: THE TEAM TURNAROUND PROCESS

How can a governor change a culture, an ingrained belief system, in order to turn an entire state around? More broadly, how can any leader work to bring a team from the bottom to the top? This is the precise question we set out to answer as we embarked on our research project five years ago. Is it possible to transform a losing climate into one that fosters collaboration, innovation, and productivity, especially when leaders in all sectors are forced to do more with less?

We began our research in the world of professional sports, speaking with owners and general managers in the National Football League, Major League Baseball, and the National Basketball Association. Professional sports represent a unique business, where the on-field product—the team—has a hard time distancing itself from its black-and-white win-loss records. In this world, it’s easy to identify a turnaround.

After our initial research was published in the 2010 Journal of Leadership & Organizational Studies, we expanded our questions to the world of business, talking to leaders at different levels, from CEOs to frontline managers. Some of our findings supported past research (for example, the finding that leaders at all levels, not just the highest leaders, can create change). But one amazing finding emerged. We discovered that, although the specifics of different turnarounds varied widely, and although they encompassed factors ranging from the size of the team to the scope of the challenge, there was remarkable consistency in the process that successful leaders in all sectors went through. We found six elements that were common to all the turnarounds we explored. These elements fit naturally into a six-stage model, one that we call the Team Turnaround Process, as shown in the following illustration.

The Team Turnaround Process

Stage I, shown at the bottom of the illustration, is when a leader first observes the wreckage, the poor performance, and the other dynamics that are common in losing teams. Stage VI, represented at the top of the illustration, shows a team that has successfully changed and is striving to continually nurture a high-performing culture. Together, the six stages of the Team Turnaround Process form the larger developmental journey that teams go through as they move from failure to success.

Each stage contains specific developmental milestones—principles that leaders and their teams typically master before proceeding to the next stage. Most teams tend to complete a stage before moving on to the next, but you should expect occasional overlap and possibly backward cycling. Every team is unique, and even though the Team Turnaround Process captures helpful generalities, it’s not intended to address all situations and scenarios.

The goal of this book is to empower you to believe that you can make positive changes. Each of the first six chapters is dedicated to a particular stage of the Team Turnaround Process and explores various elements specific to that stage, through the words and stories of executives, coaches, and leaders who have turned their organizations around. The final chapter is a hands-on workbook that offers discussion questions and exercises to further facilitate your own Team Turnaround Process. As you read through the chapters, you will discover a clear and accessible model—a playbook—for how a turnaround takes place, a model that will help you and anyone else who is intent on turning a team around. There will always be factors outside your control, but as a leader, you will find that there is plenty within your control. The stories used to capture the Team Turnaround Process will remind you of that.

OVERVIEW OF THE CHAPTERS

Stage I: Leading Past Losing

In the first stage of turning your team around, you must honestly evaluate the current state of affairs. You’re not where you want to be. You may be losing games or sales, but either way, you’re underperforming.

In Chapter One, Philadelphia Eagles owner Jeffrey Lurie, Kendon Industries president Frank Esposito, and Juniper Networks vice president David Helfer all discuss what they saw when they began leading their respective teams. They describe how they communicated those truths to their groups and how they slowly took action to clarify misunderstood roles and responsibilities. Stage I is the starting point, and it focuses on conducting honest evaluation, accepting the reasons for recent failures, and identifying the root causes of problems.

Stage II: Committing to Growth

Accepting reality is vital to beginning the turnaround process, but seeing past the current reality is just as important. Whereas stage I is about hard times in the past and the present, stage II is about envisioning the future. In stage II, you have a distinct opportunity to describe what the future can be and to communicate that message through a vision. The values that will guide the group forward and the plans and goals needed to focus the group on continual growth are just as important as a clear vision for the future.

In Chapter Two, Bill Polian, former president of the Indianapolis Colts; Jim Grundberg, co-owner of the SeeMore Putter Company (SeeMore Putters), a small golf-related business; and Jere Harris, co–lead producer of the Broadway musical Spider-Man: Turn Off the Dark, all talk about how they got a group to believe it could be better than it was. You can begin the slow shift of turning your organization toward brighter days by telling your team members that you are all going to climb upward by introducing a unique set of values, and by clarifying goals for the group to commit to.

Stage III: Changing Behaviors

In the third stage of the turnaround process, the emphasis shifts from planning the future to actual doing. Throughout this stage, leaders introduce new behaviors and best practices, and they slowly work to reinforce them.

In Chapter Three, Ani Shabazian, director of a child care center; Marilyn Masaitis, owner of a diner; and Kim Mulkey, coach of a national championship women’s basketball team, tell their stories of how their organizations learned new behaviors, how those behaviors were modeled, and, ultimately, how celebration and discipline were used to reinforce champion-level efforts and action.

Stage IV: Embracing Adversity

Once you and your team have adopted the behaviors needed for success, you’ll be ready to go out and test yourselves. As your team slowly turns around, it will inevitably face roadblocks, but these challenges can prove beneficial. Your team will grow stronger by meeting them head on and overcoming them.

As you will see in Chapter Four, Tim McIntyre, Russell Weiner, and Patrick Doyle, key members of the executive team at Domino’s Pizza; and Bill Stoneman, former general manager of the Los Angeles Angels of Anaheim, used challenges to create resilient, positive, and confident teams. In stage IV, challenges are embraced, and your team begins to feed off obstacles as a means of testing its strength and becoming even stronger.

Stage V: Achieving Success

In stage V, you will finally meet with success. Your team will have identified where it wants to go, taken the steps to get there, and proved it’s a contender by overcoming challenges. Your team will now be ready to win.

This is a stage filled with achievement, but the team’s accomplishments are also accompanied by the logical question What’s next? Once you’ve achieved your goals, where do you go? How do you recalibrate and move on?

Chapter Five—which features an inspiring definition of success offered by Mike Daly, coach of a national cham­pionship lacrosse team, along with a unique description of adaptation provided by Matt Kopac, an intriguing execu­tive at a small e-mail-based marketing firm—will help you come to view a win as marking less of an end than a beginning.

Stage VI: Nurturing a Culture of Excellence

The final stage in our model serves as the foundation for future success. As your team evolves into stage VI, it will continue to succeed, but now sustainability becomes the focus. As you turn your attention to sustaining the organization’s progress, you will place an explicit focus on three principles that have actually been with you since stage I of the Team Turnaround Process; continual learning and innovation, along with an intense understanding and maintenance of your culture, will take center stage.

By stage VI, your team will have become a winning machine, but maintaining a dynasty requires a constant effort to stay out in front and continually grow. In Chapter Six, you will hear from Dan Rooney, owner of what is arguably the most successful franchise in the National Football League (NFL), and from Jerry Weast, recently retired superintendent of a large Maryland public school district. Both share their insights into continual achievement and explain the importance of always learning and innovating, and of nurturing a culture of excellence.

Chapter Seven, the final chapter, is a practical workbook designed to help you lead your team through the Team Turnaround Process. In Chapter Seven, leaders will find a number of exercises intended to help bring clarity to their own