Sunday, January 08, 2006

Corporate CPR


Carl-Henric Svanberg, CEO of Ericsson, has been credited with the turnaround of the Swedish mobile telecom company. In an interview with the Financial Times on 20 March 2005, he said: “We had only one bullet, only one shot to make it right.”

It is not unusual for CEOs to think that corporate resusitation requires just one deep breath or single bullet to make things right. However most of the turnarounds we have witnessed require more than one hit. Most turnarounds consist of many small steps that collectively add up to success. It is these consistent incremental actions that make the difference between success and failure, not one big lunge forward.

To Mr. Svanberg, he probably felt that he had only one bullet to transform the company and keep it out of imminent danger. Obviously Svanberg hit his target between the eyes. I think that if he looked backwards over the past three years at the make or break decisions along the way, he would see that there was a pattern of many small breathes that revived the patient.

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