We hear stories all the time of businesses failing.
It’s common knowledge that most businesses fail within their first five years. It’s completely understandable. A business is incredibly difficult to get up and running, gain audience awareness, and achieve market saturation. So when a new business fails we think nothing of it.
But what about the stories of legends failing? Those stories are the ones that shock us. Those are the stories we never forget. Because it seems so implausible. How did this titan in their industry, who rose to recognition and dominated their market…how did they fail?
What could possibly have gone wrong?
Well it turns out that money isn’t everything and it can only buy you so much time on the way down. And every move made was born from the decisions of leaders who lost their way.
Leaders who lost track of their vision and their conviction.
Leaders who made one tiny little compromise at a time.
Leaders who stopped making decisions based on what they believed in and started rationalizing every decision based on profits and margins.
Leaders who were glamoured by results and performance instead of character, compassion, and principles.
It wasn’t an overnight annihilation. Oh no, the most thorough and devastating destruction never is. It’s a slow and silent death. It’s a death by a thousand cuts. It’s one compromise and misguided decision after another over years that destroys an organization from the inside out. It’s the cracks in the foundation that bring the house down.
This is how an organization crumbles. It's a story too many of us know too well.
The First Cut
| Leaders hire or promote the wrong people into management roles.
Their choice is driven by skills and performance. They choose people who bring value through either increased profits and productivity, or decreased waste and expenses. They assume that the person who performs the best is the most qualified to lead others to do the same.
Leaders fail to value character over performance.
The wrong people rise to the top because they performed at their job, not because they are fit to lead with integrity.
The Second Cut
| Leaders listen to poor counsel.
Leaders fail to understand that character and values are what drive wise decision making. The heart must lead first in order to make decisions for the greater good. A business can’t be selfish. Leaders have to understand that people and heart are its greatest asset. That it's the people you hire- their character, integrity, values, skills- that are the driving force behind a company's success- its productivity, creativity, innovation, flexibility, service, and excellence.
But instead the leadership team is comprised of performers who value results leading to counsel, conversations, and decisions shaped through that lens. People are seen as disposable stepping stones to the great reward- more profits, more margin, more growth, more success.
It becomes harder and harder to live by what we believe, to make decisions based on conviction, when those we’ve chosen to lead with, don’t share those same values. Little by little, the resolve to lead with integrity begins to fade. And it’s made easier and easier by the affirmation and encouragement from our chosen “poor counsel” that what we’re doing instead is “the right thing”.
The Third Cut
| Leaders allow managers without honorable character to have influence over people's careers.
Poorly chosen managers lead through pride, intimidation, and manipulation.
They are driven by their own selfish ambition to be the best and look the best. So they crack the whip and expect people to fall into place.
But there’s no heart to care. No humility to grow. No tolerance for any perception of weakness. No safety for vulnerability. No values to convict.
People are afraid to stand up or speak out.
Those who stand up get pushed out.
Those who speak out get silenced.
The team suffers, the performance suffers, and the people are punished for it. They’re berated and bullied into compliant suffering.
And eventually, the cracks start to seep through. The chinks in the armor start to fall.
Goals aren’t met, performance declines, margins shrink.
Attendance suffers, employees become disengaged and disgruntled.
The atmosphere starts to shift. The thrum of energy and excitement that used to pulse through the organization fades to a dull beat.
What managed to stay hidden for a while, starts to become undeniable.
The organization is starting to bleed.
The Fourth Cut
| Leaders only ever get one side of the story.
Leaders can’t deny that something is wrong. So they talk directly to managers to get a better understanding. To try to troubleshoot, determine the issue, and do some damage control.
And the managers spin the story.
It’s the people. They don’t care. No one wants to work. They’re not living up to expectations. We need to let some people go and do some restructuring. We need to come down harder.
It’s the economy. It’s a tough market right now. There’s nothing we can do. Our competitors are stealing our customers.
Leaders trust that information and never verify it. It sounds reasonable enough. Because the only other alternative is that it's the manager. But that would be much harder and more inconvenient to face. That would require admitting they made a mistake and have turned a blind eye. And that couldn’t be possible.
So it must be everything else.
The Fifth Cut
| Leaders fail to build trust with other employees so no one feels comfortable bringing a second side of the story to the table.
All this time, the leaders assume the managers are “doing their job”. Assume they are leading with integrity, making decisions on pure motives. Assume people feel comfortable and safe and that if there was a problem that someone would say something. That if there was a problem, they would know about it.
So the leader acts on assumption instead of intention.
The leader fails to be intentional about building relationships with everyone, regardless of ranking or position.
Fails to be intentional to create an environment of safety and trust.
Fails to communicate expectations for dealing with conflict.
Fails to make sure there was follow through.
Fails to be intentional about creating a system that ensures everyone is accountable at all levels.
Fails to realize that trust is only created through intention, not by accident.
The Death Blow
| Leaders choose to stay ignorant because it's easier to blame every other factor than to admit they put the wrong person in the wrong role.
The problems don’t go away. They get worse.
Leaders invest in manager training, customer service training, podcasts, books, consultants. They add new company swag, better benefits, higher pay, more employee incentive programs.
And it helps for a bit. And then it doesn’t. The bleeding continues.
People are leaving for “better paying jobs”.
People are leaving for “more flexibility”.
People are leaving because they “don’t want to work anymore”.
People are getting let go for “failing to meet expectations”.
People stop investing and start settling.
The denial solidifies.
And the employees remaining launch their campaign against you.
How many employees quitting or getting fired are you going to justify?
How many great people will leave?
How many great people will get pushed out?
How many people will be terminated without justifiable cause…
Before you open your eyes to the truth and take ownership of what you're allowing to happen within your organization?
That you’re allowing poisonous, ego-driven people to have unchecked power to make people's lives miserable.
What will it take for you to realize your company is getting destroyed from the inside-out?
What will it take before you finally do something about it?
The Legend Falls
| Leaders can’t protect their company from their own dysfunctional culture.
High turnover, employee disengagement, lack of safety and trust, broken culture that hurts experience and reputation.
Processes break down. People notice. Customer experience dwindles. There’s no creativity, no innovation, no growth.
Because the culture is broken.
Leaders spend the majority of their time putting out fires and dealing with people issues- drama, tension, complaints, performance improvement plans, unemployment, recruiting, interviewing, training.
They get trapped in a cycle they can’t break free from. And this cycle is the implosion point of the entire organization. It’s a loss it can’t come back from.
The company bleeds out- employees, customers, margins.
And the story ends there.
Only to be repeated over and over again by thousands of other organizations living the same storyline.
Write A Different Story
The popularity of this story doesn’t make it a good one. It’s not a story outline we should accept.
This shouldn’t be “the status quo”. We shouldn’t settle for this just being “how business works”.
It can be different. It can be so much better. It needs to be.
If you’re the leader in this story- stop the fall. Recognize that change doesn’t start unless you change. Open your eyes to what’s happening around you. Take ownership and commit to writing a new story for your company.
The change starts right here. Go back to the beginning.
Clarify the values you want to live and lead by.
Find people who share those values.
Then lead together with passion and conviction.
Don’t compromise. That’s where the fall began in the first place.
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