Case Study

Organizational Development

This long-term engagement with a large organization remains one of my most successful turnarounds. When I began the engagement as interim CEO, finances, culture and governance were in crisis. When I left three years later, the organization was fundamentally changed and ready to usher in its next chapter. 

Challenges

The issues undermining this organization were entrenched and systemic. It faced a lawsuit that posed a serious threat to shrinking assets. It had been operating with deficits for years and couldn’t pay its bills. There was a complete lack of trust, internally, externally and throughout the organization. And through the erosion of these problems over many years, the organization had lost sight of its core mission.

Actions

A full accounting of the organization’s reversal would literally take hundreds of pages; however, some of the greatest changes stemmed from re-engaging the board, re-shaping its culture and realigning the organization.

Energizing & Activating the Board
Lack of leadership at both the Board and CEO levels were the prime reasons for dysfunction in the organization. We increased the frequency of board meetings, began building trust and creating transparent, open communication.

We instituted rules for appropriate communication and brought in a handful of new members as a few trustees resigned, all of which helped suppress internal fighting and helped the organization move forward .

We reactivated dormant committees and created new ones, making board members into problem-solvers genuinely motivated to tackled complex problems together.

Reshaping Organizational Culture
A key part of beginning to change the culture was just being present, dependable, open and accountable in a way that past leadership had not been. Regular meetings with direct reports, management meetings, finance committee meetings, and consistent, reliable information-sharing began to repair employees’ trust in leadership and each other.

Reshaping culture also meant clarifying expectations, including creating job descriptions for every employee, establishing personnel, financial and department policies. When everyone had a clear sense of what s/he and others should be doing, it introduced a level of accountability that motivated most and drove others — people at the root of the organization’s troubles — to resign.

Realigning Resources & Initiatives
Because trust had been so eroded, the various divisions of the organization had long been acting independently, with no sense of how their spending impacted the organization or how their activities did or didn’t support the mission.

In collaboration, the board and I identified a set of strategic priorities that would guide all our spending and activities for three years. With that list as a guide, I took serious steps to cut expenses, including layoffs and temporary pay decreases across the organization.

Resources were channeled into mission-driven programs. I brought in marketing and PR resources to better position revenue-generating programs, and, over time, the sum of the organization’s activities not only chipped away the massive debt but also once again began to solidly reflect its purpose and brand.

Outcomes

After three years, the organization went from years of annual deficits of more than $355,000 and payables of $750,000 to a budget surplus of $730,000+ in year one and $2.7M+ in year two. The lawsuit was settled, and accreditation issues were resolved. Board meetings that had been icy at best were lively and participatory, with members fully engaged as stewards of an important legacy.

The tone of the organization changed at every level, and employees that had felt beaten down and demoralized developed a sense of common ground and greater mission. Their inspiration translated into better programming, and new initiatives garnered major media coverage.

The big challenge to any change is making it stick, In this turnaround, I can joyfully say that the changes implemented in those three years have stuck: systems are in place, and the organization has continued to move forward with renewed health and purpose.