Organizational Change Case Study
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.
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
The story of the organization’s transformation would literally take hundreds of pages, however some of the greatest changes resulted 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 which began building trust and creating transparent, open communication.
We instituted rules for appropriate communication and acquired a handful of new trustees to replace vacant positions, 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 tackle complex problems together.
RESHAPING ORGANIZATIONAL CULTURE
A key part of changing the culture was just being present, dependable, open and accountable in a way that past leadership had not. Regular meetings with direct reports, management meetings, finance committee meetings, and consistent, reliable information-sharing began to repair employee trust in leadership and each other.
Reshaping culture also meant clarifying expectations including creating job descriptions for every employee, and establishing personnel, financial and department policies. When everyone had a clear sense of what they 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
In collaboration, the board and I identified a set of strategic priorities that would guide all spending and activities for three years. With that 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. Over time, the organization’s direction not only chipped away the massive debt, but once again began to solidly reflect its purpose and brand.
- The organization went from annual deficits of more than $355,000 and payables of $750,000 to a budget surplus of $730,000 plus in year one and over $2.7 million in year three.
- The lawsuit was settled.
- 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 who had felt demoralized developed a sense of common ground and greater mission.
- New employee-inspired programming and initiatives garnered major media coverage.
- The organization has continued to move forward with renewed health and purpose.