The following article was originally sourced from the piece “Turnaround Lessons” on Kellogg’s News & Events page.
When a company seemingly resurrects itself after being written off as unprofitable, oftentimes it’s believed that it’s a charismatic leader or breakthrough innovation acting as the catalyst to success.
In his latest book, Resurgence: The Four Stages of Market-Focused Reinvention, Kellogg School of Management Professor Gregory Carpenter shows that this romantic viewpoint is nothing more than myth.
Carpenter and his co-authors, former Kellogg Professor John Sherry Jr. and Gary Gebhardt ’05, associate professor of marketing at HEC Montréal spent more than a decade analyzing seven companies (including iconic brands like Harley-Davidson and Motorola) and studying how they reinvented themselves with a market focus.
All of the firms covered in this book took similar steps—everything from reorganizing to adding new people and incentives. However, despite taking similar actions, some failed companies failed while others succeeded.
“Rather than leadership being the key, all the successful companies made decisions in the same sequence,” says Carpenter.
Carpenter says that for the companies who righted their ship, the benefits have been impressive— those business have seen reclaimed market shares, higher profits, more innovation and more productive and engaged employees. On the other hand, those companies who fared less ceremoniously remain wading in an endless cycle of incremental measures that have failed to address the underlying causes of stagnation.
Carpenter believes that with Resurgence, there’s no longer a reason for struggling companies to ponder the way forward. It’s more about leaders mustering the courage to look deeply at their firm and ask: “Will our culture enable us to confront the challenges ahead and thrive?”