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The First Step In Corporate Turnaround Is Prevention

By: Mike Teng

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Contrary to common belief, a company is not an inanimate object. In fact, there are many similarities between companies and people, companies are living organisms that comprise communities of people that contribute to their distinctive personalities and attitudes. Like us, companies fall sick, due to various reasons such as economic slowdown, competition and incompetent management.

However, there are workable, preventive, diagnostic and therapeutic steps to treat and restore the health of sick companies. Similar to how we manage our health, acompany needs to follow three key steps to ensure and sustain its long-term health, namely prevention, early diagnosis and proper treatment. There are 18 medical principles in corporate health associated with these three steps which will be presented in three parts. The first part is on the first six principles guiding the step on Prevention:

Akin to people, most companies get into trouble simply by neglecting their health. However, the old saying of 'prevention is better than cure' applies also to companies.

Principle 1: Laughter and fun are the best medicine
Laughter and fun have been recognised for centuries to be the best medicine. The correct use of laughter and fun in the workplace facilitates learning, and changes people's behaviour as it helps them feel less threatened by the prospect of change. Laughter and fun have been found to be the best tools for giving the corporate identity a human face.

Disney world is one of the best success stories on the use of this tool. Reputed as a fun place for kids and the 'kids'in all adults, Disney World has attracted millions of visitors every year. Many visitors also patronise the playground several times in their lifetime. The fact is, people do like doing business with people who are fun.

A fun working environment is also more productive than a routine one. People who enjoy their work do create more and better ideas. Fun is contagious. Therefore, to have a really happy workforce, you got to do more than pass out bonuses and angpows. You need to make work fun. Science opens to us the book of nature, while laughter and fun open the fountain of human creativity.

Principle 2: Rest in order to rejuvenate
One of the most effective ways to improve mental and physical health is rest, in the corporate context, this means stability. Here, we are faced with a paradox whereby management needs to change and evolve in order to cope with rapid developments in a fast-changing business landscape. Yet, in the quest for growth-inducing changes, companies need rest and stability. Like a human body, a company needs rest for it to re-charge and repair itself. At the same time, it also needs to remain active in order to achieve optimal body functions and good health. Thus turnaround managers have to be masters in the art of preserving stability amid changes, and spurring changes in times of stability.

It is therefore abhorrent for companies to embrace a 'hire-and-fire' approach in their human resource policy. This is equivalent to bulimia, an illness in which there is a great and uncontrollable desire to eat, usually followed by induced vomiting in order not to gain weight. Such 'corporate bulimia' rips the fabric of corporate cohesion, self-interest replaces corporate interest as suspicions among staff increase and loyalty towards the company wanes.

Principle 3: Endorphins give a sense of well-being
Endorphins, substances produced by the brain, give a sense of well-being, and help bodies cope with stress and other ailments. In a company, training and development generate endorphins which are released when an employee with untapped potential is nurtured within the right environment. Employees are thus motivated to contribute more effectively in their respective roles that transcend their job descriptions.

Some managers view training and development as heavy expenditures as trained staff may eventually resign. However, there is a fallacy in such an argument as investing in people does pay dividends, companies that emphasise training and development are placing their best bets on the future because they bet on their people's potential for further growth. Companies really cannot afford not to train their staff, as it may lead to ignorance, which is a higher cost to any company.

Principle 4: Change mental attitudes to build financial health
It is often said: "The difference between heaven and hell is not the altitude but the attitude." Medical science has generally found that in psychosomatic ailments, a person's mental attitude, mindset and psyche can have a tremendous impact on his physical health. When your mental attitude is negative, you may feel chronically depressed and hopeless, which will drive the immune system into a self-destructive mode where viruses can easily establish a foothold. In sick companies, employees tend to wallow in self-pity, lick their own wounds or play the game of shame and blame.

They may place blame on everything conceivable: intense competition, demanding customers, incompetent bosses and so on. Perhaps an apt description for themselves is: "We have met our greatest enemies - us." In times of negative mental attitudes, it is always best to keep busy, to plough your staff's energy into something positive. Small changes in the staff's mindset can go a long way in building a healthy corporate culture. You should recognise, commend and celebrate every little success. Once people start to achieve success, it spurs them on to greater efforts. Mental attitudes are contagious.

Principle 5: Vision, feedback and action - three meals a day keep the corporate doctor away
Someone said that feedback is the breakfast of a champion. However, in today's turbulent marketplace, breakfast alone is not enough. you need three meals to keep the doctor away. in the corporate dietary system, you need vision for breakfast, feedback for lunch and action for dinner. Vision and feedback without action is dreaming. Action without vision and feedback is wasting time. But vision, feedback and action - the three meals a day will serve to keep the corporate doctor away.

Some people believe that information is power. But information is useless if no one acts on it. It is similar to the treatment of a sick patient. The doctor can have ail the right information on how to cure the patient. However, if he does not take appropriate and timely action to treat the patient, the outcome for the patient remains unchanged. Conversely, action must be complemented with the correct information. Acting on the wrong information may kill the patient as the remedies may be worse than the disease. This is why all three 'vision, feedback and action' are necessary,

It is the application of the correct information that unleashes power in the context of management theory it is useful to apply the best blend of Eastern and western practices. Developing Asia can learn much from the more established and intellectual western managerial professionalism in the area of clear vision, proper research and feedback. On the other hand, the west can learn from Asia's entrepreneurs with their acumen and instincts to quickly act on the information available. Therefore to compete effectively in today's global marketplace, it is vital to integrate the vision and feedback management system of the West with the entrepreneurial action of the East.

Principle 6: Manage self with the head, manage others with the heart
It is the head that helps to analyse and strategise, but it is the heart that fosters understanding and commitment so critical for long-term corporate success. to increase the corporate life-span and longevity, you need to manage both the 'head' or 'hard'issues, as well as the 'heart' or 'soft' issues. Strategies and hardware will come to naught if the people's hearts are not with the company. The implementation will go wrong if your people's support and commitment are not there, in turbulent times, one needs also to deal with the 'soft'or 'heart' issues especially those relating to people. you should be hard on performance, but soft on people.

Corporations have for centuries searched for that elusive fountain of corporate youth through all kinds of different management theories, technologies and programmes. We invest millions of dollars in the quest for corporate excellence, but we forget the basics. It is the people who make the products and the people who buy them that ultimately determine corporate longevity. Just like a human being, the corporate body needs strong cells to fight corporate ailments. Often, it is the people that fail and not the business. At the end of the day, you have to remember that all the work is done by your people. This is why an old proverb says: "If you are planning for one year, plant rice. If you are planning for 10 years, plant trees, if you are planning for 100 years, cultivate people."

Article Source: http://depositarticles.com/

Dr Mike Teng (DBA, MBA, BEng) is the author of best-selling book, "Corporate Turnaround: Nursing a Sick Company back to Health." He is known as the "Turnaround CEO in Asia" by the media. www.corporateturnaroundexpert.com; www.corporateturnaroundcentre.com

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