Leading the Downward Cycle. What Success Can Hide and a Turnaround Will Expose

It is alarming to see what this does to entire organizations.

Focus disappears. Everything becomes urgent. Initiatives, task forces and reporting multiply. Organizations start running around like headless chickens.

What is needed is almost the opposite: a few brutal Must Win Battles, clear direction, clear ownership and relentless execution.

Research helps explain why. Under threat, people narrow their attention, tighten control and fall back on familiar patterns. Turnaround research also shows that more restructuring is not necessarily better. What matters is reducing complexity and making the few choices that really matter.

Yet I see two opposite mistakes.

Some leaders try to control everything. Others suddenly discover empowerment: “You decide. Experiment. If it doesn’t work, try something else.”

That may sound progressive. In a serious downturn, it can be disastrous.

An anxious organization doesn’t need less leadership. It needs much clearer direction.

Good turnaround leaders know what belongs at the top. They make brutally clear what matters, what stops, where to cut, where to invest and what is no longer negotiable.

Then comes the blame game.

Who caused this? Sales? The regions? Corporate? Previous management?

People protect themselves. Bad news travels more slowly. Information becomes political.

Blame destroys exactly what a turnaround needs most: truthful information.

Accountability is essential. Mature leaders also ask: What did I contribute? Which of my assumptions, decisions and biases are part of the problem?

Closely related is something particularly dangerous at the top: Looking Good.

Years of success breed self applause. Great strategy. Great culture. Great leadership. Everyone reassuring everyone else how exceptional they are.

When the cycle turns, that game has to stop.

A downward cycle doesn’t care about your self image.

No polishing the story. No protecting reputations. No defending yesterday’s decisions because they were yours.

Under pressure, old patterns get louder. Controllers control more. Achievers push harder. Harmonizers avoid painful decisions. Dominant leaders stop listening.

What made you successful can become exactly what now gets in your way.

I am watching brilliant, highly accomplished executives struggle with this right now.

A downward cycle exposes what success can hide: your relationship with control, capacity for conflict, ability to regulate yourself under pressure, willingness to make unpopular decisions and to hear what you desperately don’t want to hear.

A downturn doesn’t just test your strategy. It exposes your leadership maturity.

Before deciding none of this applies to you, look around.

Who still tells you what you don’t want to hear? Who tells you when you are becoming part of the problem?

If you struggle to come up with names, you may already have your answer.