Pay attention long enough and you will notice a visible gap between various organizations. Food service, medical care, retail, non-profit…there is large variance across all sizes and types of groups. Some teams win, others lose, and many teeter somewhere in the middle.

Here’s your sign

What are a few signs of an organization that is losing, or trending in that direction?

1. Flattening or decreasing sales. The most basic function of business health is that customers are glad to do business with you. Amazon anyone?! No matter the size or history of an organization, you are either growing in sales from customers, or you are dying.
2. Declining customer reputation. Have you ever noticed the gap between how some businesses market themselves vs. how you and the people you know think/talk about them?  “Ba-da-ba-ba-baaa … I’m lovin’ it. Have it your way. Yo quiero Taco Bell”. Is this the way that customers actually feel about each brand? If the gap between reality and perception is growing, the organization is in big trouble.
3. Increased sales gimmicks. When businesses begin to sense a decline, instead of addressing the actual core issues they often resort to sales and product tactics. Increasingly frequent discounts or constantly adding and removing options that are being offered to the customer are panic tactics that send a clear message: “We are not confident in ourselves, and you shouldn’t be either”.
4. Negative employee reputation. Much like the gap between brand reality and perception from the customer, the same applies to employees. Who knows better about an organization than the people who are inside it working 40 hours a week seeing the good, the bad, and the ugly? Organizations that are moving the wrong direction have employees who talk negatively about their work experience there to anyone who will listen, including to each other. 
5. Lack of energy. Often when you encounter an organization, you can feel the palpable lack of energy. It feels like the whole place is on life support, and this does nothing to instill confidence in the consumer.
6. Profit > Growth. While profit is an integral part of any entity, a clear sign of a dying organization is that it will increasingly make decisions to make an extra dollar today at the expense of longer term growth and health. This strategy only works for so long, and when it catches up with you the repercussions are staggering.

What lies underneath

I mentioned above that companies will often avoid addressing the actual problems that are central to the issues that they are experiencing. In my experience, there are three foundational diseases that plague dying organizations and that, if addressed, would begin to move the group in a positive direction:

1. Lack of customer focus. Nothing could be more basic, and it’s so simple that it is often overlooked. Whatever an organization is doing, the purpose is to add enough value to others so that they are willing to happily pay their money for it. So many forget this and they violate the number one rule of success: Focus on adding value to the customer. You will not make money if you don’t add consistent value to the customer. You will not be able to provide impactful jobs without adding value to the customer. We could go on and on here. While many different things can distract from the customer, by far the biggest threat is making money. Adding value for the customer will lead to making money, but it doesn’t work the other way around. This is a real rookie mistake that leaders make over and over again, and many never learn the lesson, even after it’s too late.  
2. Lack of conviction for a mission/lack of conviction to hold everyone accountable to the mission. Sports teams should be trying to win the championship. An army should be trying to win the war. Some organizations have no clue what exactly they are trying to accomplish. Employees receive conflicting messages, and even from month to month the priorities change leaving everyone in a fog of confusion. Is there a clearly defined mission? If so, is everyone being constantly reminded of the mission and being held accountable to it? Allowing employees to underperform while they inhibit the organization’s ability to accomplish the mission is never acceptable. This is the tail wagging the dog. For many entities, the leaders act as if the rules do not apply to them, and this behavior also sends the message that the mission simply is not really that important. Does the mission really matter? If not, no one will act with conviction towards accomplishing it. People will move heaven and earth to take part in a clearly defined mission that is worth pursuing. Unfortunately, many organizations are unaware of this and never get anywhere close to tapping into this phenomenon.    
3. Constant people problems. This one goes hand in hand with the previous two problems. Some organizations languish due to never having enough people needed to perform at a high level. It would be like playing 3 on 5 basketball day after day, and the math simply does not add up. Perhaps even more frequent than not having enough people is the issue of not having enough GREAT people. Many organizations hire up to a certain head count, and the roster ends up filled with 2 star and even 1 star players. How many times have you interacted with an employee somewhere and thought “Why in the heck did someone hire this person here, and how are they being paid to continue to work here day after day?”. One bad employee can single handedly tear down the reputation of a business. Just as bad, one bad employee will sometimes cause the good employees to leave and go elsewhere, leaving the roster more depleted than ever. What is the level of talent and culture fit across the roster of an organization? This will directly dictate the level of success or failure that will be produced.

Simple but effective

Nothing about what has been mentioned here is complex or exciting. Creating and maintaining a successful organization takes a lot of hard work, but it is pretty simple. Have a compelling mission, hold everyone accountable to it, attract and retain great employees, and keep the customer’s interest at the forefront at all times. The rich groups do this and they get even richer, while everyone else moves the opposite direction towards their own impending collective death. 

For more tools that equip organizations to win, check out my Talent Toolbox!