Sometimes companies stagnate because of a down market. At other times, they stagnate because of competitive pressures, the inability to keep up technological advancements, or rapidly changing customer habits and needs. And while some or all of these may be true, oftentimes companies stall because the leaders have gotten stuck in the ways things have always been done. Complacency paired with a lack of discipline or of best practices leads to the inability to elolve and reignite growth. While some leaders become paralyzed by fear, great leaders see stagnation as an opportunity to reset, learn, and move forward stronger than before.
YPO member Bridgit Lombard is a unique combination of change agent, turnaround specialist, and growth driver. An award-winning CEO, entrepreneur, and hired gun, Lombard has scaled and successfully sold various companies in the tech and consumer spaces, including Tenega, Penguin, and Nathan Sports. As a member of the Board of Directors and as a C-suite advisor, she has worked with some of the world's most powerful brands, such as Nike, Sony, Tesco, and Cisco. Her firm, Marea Partners, helps social enterprises excel in their core businesses so they can achieve the sustainable success needed to change the world.
Here, Lombard shares how effective leaders guide their companies out of stagnation:
1. Let Curiosity Drive You
When markets get tight and business stalls, people tend to lean on what they already know. Alternatively, Lombard advises embracing an open and curious mindset. If you're facing a situation that makes you uncomfortable, let go of the need to be right or have all the answers, and seek out insights instead. Lombard explains, "You need to be genuinely curious, and humble enough to hear what customers and team members are telling you. Does your product or service measure up to the competition? Are you making it easy for customers to purchase or be engaged? Is your product or service truly differentiated and valued?" Once you hear what they have to say, analyze how you can use that information to solve problems. "Determine whether you can continue to serve your current customer base robustly, or whether you should identify other markets or customers that your business and capabilities are better suited to serving," she encourages.
Lombard also warns against letting your ego get in the way, explaining, "The key to being a leader who can affect change is having the courage to ask questions that might bruise your ego and hearing answers that you may not want to hear. Those answers are gifts that will help you and your business evolve." Leaders look to get things done the right way, even if it's not their way.
2. The Past Is Just That - So Let It Go
When things in business are going poorly, wishing you could return to the good ol' days won't get you anywhere. Lombard believes that leaders need to let go of what was. "I meet so many leaders that are stuck on "the way it used to be' or 'the way it should be.' My response is, 'Who cares?' It's not real anymore." Instead, she pushes leaders to look forward.
"The only thing that matters," she says, "is what is happening today. Come to terms with it and go from there." For Lombard, it's all about pragmatism at this point. "You need to get real about what is needed to drive growth. Be honest about your capabilities and your place in the market," she argues. Look at everything with fresh eyes so that you can build towards a better future.
3. Put It Into Perspective
When markets or companies start to fall apart, fear, blame, and shame can set in. Lombard urges leaders to stay calm: "In difficult business conditions, leaders often start to panic and just start throwing things at the wall. I like to take a minute to step back and get perspective."
To get a clearer view, "Look at it as a funnel. Start from a wide angle, examining the overall macroeconomics and global market dynamics. What levers are being pulled that affect your business? Once you understand the environment, you need to determine how much these realities are affecting your customers' buying habits, and whether your product or service is answering their needs in the most compelling way possible," she explains. Lombard advises they design an approach that will lead them to a greater understanding of what the "Why?" is for their business, and then build a path to the next evolution that aligns with their why.
4. Process, Process, Process
Processes and best practices are the elements most often forgotten as companies develop. Lombard has found that to be true regardless of business size, and regardless of whether a company is growing by 300% a year, starting to stall, or already down. Lombard shares, "I've seen this in startups under $20 million and in organizations over the $250 million mark - process is usually a big reason for the lack of continued growth and evolution. If you don't have identifiable, repeatable, and effective best practices in place, you cannot continue to scale."
There are many tools available to help leaders implement processes, including methods such as Scaling Up and EOS, but you have to engage with them. "It's critical for leaders to understand that they may not have the skills or experience to put best practices into place. You can't be afraid to ask for help - either from an advisor, your board, or those who have done it before. There are plenty of us out here who do this day in and day out, regardless of product or industry, and can help you maximize efficiencies and get your house in order so you can scale." To succeed, you need to leverage the resources available to you.
5. Dig In and Know Your Numbers
Often, leaders who have seen great success and growth get accustomed to having lots of money coming in, a growing team, and a rapidly-building brand. But if you start to see growth stagnate, you must take the time to dig in and understand every part of your business. Lombard shares, "I worked with a couple of very successful entrepreneurs recently who built a $100 million global brand - they were on fire. But they got caught out because they had no control over where the money went once it came in. Now they've found themselves laying off half the company and fighting to stay alive."
Lombard encourages leaders to really dig into the details of the company's financial numbers. "First, monitor your cash flow. Get a 13-week plan in place, and examine it every week. Next, revisit your contracts and negotiate your payment terms. Then you can put your dollars to work towards your growth plans," she advises. She also offers a warning: "Even if you are in a strong cash position, every expense needs to reflect your growth goals. Your SG+A [Selling, General, and Administrative Costs] needs to be tied to measureable outcomes, and every initiative and action need to ladder up to your annual plan and growth strategy. Otherwise why do it?" she asks. Lombard demands that every dollar spent generates more than a dollar of revenue. "ROI is my favorite acronym. I've heard leaders say, 'You can't really measure it, I just know it's worth it.' In reality, you can measure just about anything. And if you want to evolve and take your business to the next level - you must measure everything." Ultimately, what gets measured gets done.