Communicate to re-accumulate: why talking is key to successful business turnaround
What do businesses that have lifted themselves out of financial dire straits have in common?
As well as an astute turnaround plan to pull them back to solvency, they also have another vital ingredient: a commitment to open, ongoing communication when executing it.
While communication is always good for oiling the wheels of business, it’s even more critical during the delicate turnaround period. But why is it so important? And what does doing it successfully involve?
The reason why is easy to appreciate. It’s ultimately down to how the turnaround plan arrives – which is typically hard and fast. In its wake, the known status quo is disrupted, changes are implemented left, right and centre and a new strategy comes into play.
While this kind of dramatic upheaval is critical to success, for affected stakeholders – whether lenders, suppliers, shareholders, employees or management – it can feed already existing uncertainty and disengagement.
Talk your way out of distrust
To dissipate these feelings of unease, you need to start talking – and the sooner you do the better.
Simply by telling people what’s going on – rather than avoiding it – you can make the swift change of a turnaround seem less unsettling. You’ve cast that crucial lifeline back to engagement and trust – essential components of any successful business turnaround.
Communicate with care
However, while communication is key to turnaround success, it must be well executed to be effective. Saying the wrong thing, or not communicating in the right way, can actually have the opposite effect – further crushing confidence.
To avoid putting your foot in your mouth as you fight for survival , here are our top turnaround communication tips:
Be transparent from the start
As tempting as it may be to brush bad news out of the view of those invested, sharing your strategy and being open and honest from the beginning can help rebuild your credibility.
When Quantas took a financial nose dive a few years back, uncertainty and distrust was rife. However, communicating candidly with stakeholders – letting them know when things were bad as well as when they were good – was given as a reason for sending their profits skywards once again.
Stick to a clear, consistent narrative
Don’t tell your employees one thing and your shareholders another.
While it might be tempting to tailor your message to placate individual concerns, sharing a clear, unfailing message about what’s going on and what you’re doing to rectify things is crucial. After all, a consistent story is a believable one, and believability builds trust.
Facilitate two-way conversations
While some turnaround communication will be pushed out in business meetings, memos and press releases, the talk should not all be about telling.
To aide successful turnaround, you need to be facilitating two-way conversations. Speak to people face-to-face, set up an intranet, forums and social media groups. Let people share their feelings and their knowledge.
Not only will it help stakeholders re-engage, but the insights can also be used to fuel your strategy.
Push new brand messaging
With stakeholder trust dwindling, re-building your name with strengthened brand messaging can further help your business turnaround efforts succeed.
Go back to your core values and mission and ensure they’re communicated loud and clear in your marketing communications and all other business interactions. When Billabong hit trouble back in 2013, a brand renaissance was one tactic that helped pull them through.
Silence isn’t golden
Communication really can make or break your turnaround efforts. Keep shtum and you may save your pride, but jeopardise your survival. Start the conversation and you can drive your new vision forward with the help of invested, re-engaged staff, business partners and investors.
If you want some help managing your business turnaround and communication, get in touch with us at Rapsey Griffiths today.