Blog · Nov 23, 2014

Turning a Team Around – Improving Performance from Bottom to Top

“When Pieter Nota joined Philips, four years ago, to run the Dutch technology group’s Consumer Lifestyle sector, he found a business in poor shape. The market shares of several important products were falling in the wake of harsh trading conditions and a lack of earlier investment. Sales of the company’s televisions were declining alarmingly following a brief spike ahead of the 2010 FIFA World Cup. More fundamentally, an overcentralized and functionally led organizational structure was proving ill suited to the task of managing the two formerly separate companies (small domestic appliances and consumer electronics) first brought together under the Consumer Lifestyle umbrella, in 2008.

The story of the unit’s subsequent turnaround, from Philips’s problem child to part of a group that recently announced its tenth consecutive quarter of strong revenue and profit growth, is one of astute portfolio divestment and renewal, clear strategic choices, more disciplined operations, and a rigorous focus on performance management. Underlying and driving the recovery, however, has been a less visible, but no less important, improvement in the effectiveness of the Consumer Lifestyle sector’s top team—that handful of senior executives who provide the energy, inspiration, and vision for any enterprise.” from McKinsey.com/Insights

 

Turning around the top team

I haven’t a clue whether any of the executives in the Philips’ Consumer Lifestyle division have ever rowed. But if they had done, they’d have a distinct advantage on the water from their experience in turning around their top team in the boardroom.

You see, it’s clear to me (after both many seasons’ rowing and a 34 year business career) that teams – in whatever field of endeavour – really do develop and perform at gold medal standard through understanding and applying a universal set of approaches, principles and habits.

The story outlined in McKinsey’s interview with Pieter Nota, CEO of Philips Consumer Lifestyle curiously mirrors Ben Hunt-Davis’s experience in the two years leading up to an Olympic gold medal in the British rowing eight at Sydney in 2000. Despite being the youngest, least experienced and least strong crew in the final, as they sat at the start line in the Australian heat they knew that they could draw on their previous 24 months of a turnaround process remarkably similar to Pieter’s.

Turning a team around

Challenged each day, in everything they did, by the direct question ‘will it make the boat go faster?’, they oversaw a similar remarkable rise in team effectiveness, as they worked to turn their team around.

How? Honesty, each and every day, about what was working and what wasn’t. Honesty, each and every day, about team loyalty, trust and the ‘way we work’, producing the curiously named Shambles Sheet as the output of their team rules.

And collaborating, each and every day, in order to make the boat go faster. It doesn’t mean for a moment that there weren’t barn-storming arguments about the direction and strategy of the crew. Yet as Ben wonderfully phrases it “It’s great to be right. But it’s even better to be fast”.

The Dutch have long had successful international rowing crews. Maybe, given the boardroom parallels to Ben’s Olympic gold medal winning team, it’s time to ask Philips to put their oars in the water and see how fast their boat can go!

You can read the full article here : www.mckinsey.com/insights

 

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