Michael D. Watkins on Managing Business TransitionsIn the January 2009 issue of the Harvard Business Review, Michael D. Watkins, a one-time business professor and now chairman of Genesis Advisers, lays out a robust approach for leaders to follow in handling various business transitions, such as getting a start-up off the ground, or overseeing a distressed company's turnaround.
"Picking the Right Transition Strategy" explains Watkins' STARS framework, which outlines the challenges and opportunities inherent in five types of business transition. In addition to start-ups and turnarounds (S and T), STARS covers situations of accelerated growth (a company entering a period of rapid expansion), realignment (a company facing the need to significantly adjust its strategy in order to remain successful), and sustaining success (an executive taking over a company whose previous leader was highly effective).
Watkins spells out the full details of the STARS framework in his recently published book, Your Next Move: The Leader's Guide to Successfully Navigating Major Career Transitions. The HBR article focuses on a case study that illustrates how one senior executive, with conscious deliberation, handled a pair of assignments quite differently because the first was a turnaround, while the second was a realignment.
The case example highlights the fact that the same fundamental principles which "will ease your transition and increase your odds of long-term leadership success" come into play in all situations, but must be applied in ways specific to the particular type of transition involved. The fundamental principles are (in edited form):
- Organize to learn about the business Figure out what you most need to learn, from whom, and how you can accelerate the learning process.
- Define the new strategic intent for the organization Develop and communicate a compelling vision for what the organization will become. Outline a clear strategy for achieving the vision.
- Establish priorities Identify a few vital goals and pursue them vigorously. Think about what you need to have accomplished by the end of your first year in your new position.
- Build your leadership team Evaluate the team you inherited. When bringing new members onto the team, aim for a balance between people from inside and outside the organization.
- Secure early wins Think through how you plan to "arrive" in the new organization. Find ways to build personal credibility and energize the ranks.
- Create supporting alliances Identify how the organization really works and who has influence. Create key coalitions in support of your initiatives.
- Enhance self-awareness In particular, know the leadership style that you adopt most reflexively, and be prepared to set it aside for a more suitable style if the particular transition you're managing requires that.
- Exercise personal discipline Ask yourself what behaviors with which you are particularly comfortable, you should now be doing less of; and what behaviors that you don't much enjoy, you should now be doing more of.
- Build complementary teams Get people to help you who have strengths that offset your weaker points.