Fast growing businesses are susceptible to failures. To sustain the enterprise executives must know how to manage the aftermath of an organizational failure. Specifically, the authors point to mindset shifts that can improve leadership in volatile environments. These include: collaborating with critics, making sure everyone is on the same page, and above all remaining grounded in a strong set of personal values.
In high-growth companies, it is a fact that periods of expansion are often punctuated by sudden and severe challenges. Noting the extreme tension between success and failure in businesses today, the authors set out to research how “the dark side” of growth can be managed appropriately. They describe this as the often sour situation that emerges when a business’s attempts to grow fail. Managing these moments correctly is what makes the difference between sudden death and long-term survival. According to the authors, this oft-forgotten dark side of growth affects the whole firm, but particularly the CEO, who is under pressure from all sides.
They tracked more than 110 CEOs of young, innovative companies from more than 20 different countries for more than five years. Amongst their findings was the fact that successfully managing the ups and downs of growth depends on more than luck. The ability to shift from growing mode to crisis mode and back again requires a strong set of personal competencies.
Specifically, the authors identify four shifts of mindset that leaders in volatile work environments need to make if they are to be effective. One factor that appears as a constant in all four is the need for a strong system of values instilled in an organization by CEOs from the beginning; this enables them to deal better with crises and bounce back to the growth path more rapidly.
The authors identify four shifts of mindset needed to avoid the most undesired outcomes of organizational failure:
To conclude, the authors comment that CEOs with a strong set of personal values and who are able to make the four key mindset shifts described [above] will be well-positioned to lead their companies through times of turbulence.
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