The 100-day turnaround plan for growth-focused leaders

Bill Canady has spent more than three decades leading businesses worldwide, from under-a-million-dollar start-ups to multi-billion-dollar enterprises. Over his career, he has served as CEO of multiple companies and now heads a $1.5bn middle-market power sports business while chairing a $1bn industrial products company.

Renowned as a turnaround specialist in the US, Canady has distilled his experience – both successes and lessons learned – into a book, From Panic to Profit: Uncover value, boost revenue and grow your business with the 80/20 principle. The result is a practical blueprint for leaders looking to transform their organisations.

We spoke to him about recognising when a turnaround is needed, the cultural pitfalls that can undermine even profitable companies, how the first 100 days can set the course for success, and why clarity, transparency and focus are the most powerful tools for a leader.

You talk about the rule of three: the visionary, the prophet and the operators. Could you explain?

It takes three types of individuals to run any business. First, the visionary. This is generally the CEO or founder who sets the goal and decides where the company is going. They must own that.

Second, there are the operators. These are the presidents, vice-presidents and directors who run the day-to-day business. Their job is to take the owner's goal, wherever that's going, and create the strategy. It's important that they create the strategy. If they don't own it, they won't follow it.

The final one we call the prophet – it’s our play on words, as they see the future but they also like money. They are the trainer, the one with the playbook, the expert in the process and their job is to get that process embedded into the company. These people can work for the company or be external consultants.

You need all three. In our experience, if you only have one, and that’s the visionary, the change will take seven to 10 years. If you have a visionary and an operator, it generally will take three to five years. But if you have all three, you can generally get your company turned around and running in about 18 months or less, so it cuts out a huge amount of time.

If the culture is good and you can get those roles embedded, depending on the owner's desire, they can understand what they need to do and start making changes in 100 days or less.

You put a lot of weight on the first 100 days. Why do they matter so much?

It goes back to Franklin D Roosevelt. He was elected president during the Great Depression and passed 44 laws within his first 100 days. Since then, it’s become a standard of what you can get done because what you do in those first 100 days is going to set the whole tone of what you can accomplish over the next three to four years. It sets a tone and a pace, and it forces everyone to fall in line.

You don’t turn your company around in 100 days, but you lay the plans. We look at three key focus areas. The first one is profitability. This is the easiest one to grow, primarily because of pricing. So you decide you want to do it, you set your new price, the next person who buys it, it flows through the P&L and costs you nothing. Now, it may cost you the customer if you get it wrong but that flows through quickly.

The second one is productivity, which is getting cost out. It may be adjusting shipping contracts, which can get done in six months or less but will start paying off almost immediately. If you make complex products, that could take longer but cost savings we generally say come in year two.

The third area is growth. You're going to get growth immediately because you're focusing on your key customers, but your growth typically ties to your product cycle.

If you can come up with something and launch it immediately. You can start selling it. Most companies that are selling something have to get their product cycle to align with their customers' product cycle but typically the big growth, if you're in manufacturing for example, you'll see in year three. If you do the work, you can double profitability in three to five years but the urgency and the clarity of those first 100 days are what set you up to succeed.

What process should leaders follow to identify the changes needed?

We work with businesses through my company, The 80/20 Institute, and we have a standardised process that we go through with them. It comes down to three things every time.

One is ‘I want more/I need to get bigger’. Typically, where the founder has bootstrapped the company and they’ve got a team around them that is good for maybe £1m but now they’re at £2m or £3m and they’re stuck or don’t know what to do next.

The second is fear: ‘if I don’t fix this, I’m going to go out of business’. You could have declining revenues and you can lose money, but if you don't have cash, you're going to go out of business.

And the third is the exit. The person who has grown the business may want to go down something else, step away or is just thinking to themselves about what to do next.

Once we understand that, we ask them two questions: What’s your three-to-five-year goal? Essentially, do you want to save the company, grow the company or exit the company?

The next question is what number do you have to get to make that work? They may be running at 50 per cent of where they want to be – say £3m in revenue – but they want to get to 100% – say £6m in revenue – and set that expectation. Then, we ask them to tell us about their products and customers. We segment it out and that’s where the magic happens.

We look at the things that they're making good money and growing on and we say go do more of that. And the things that they're not making money on, we say do less of that. It sounds simplistic, but it works. We find that this falls into the Pareto Principle, also known as the 80/20 rule, where 20 per cent of what you're doing is getting you where you want to go, and the other 80 per cent is distraction.

People will fight that. They’ll see the data and come up with excuses about why they won’t change. We help them develop a plan to shift the resources from where they're not effective, their time, their capital and their team, over to what is. That's a huge journey and takes a lot of change management.

It's taking that resource and making sure you can grow from these changes. That may mean you stop doing something, you need a different type of employee, you upskill your employees, you stop doing products or maybe you just price it differently.

How do you make sure the team comes on the journey with you?

I talk about four commandments in the book. The first is be on pace. As a leader, you can't go too fast because you will leave everyone behind or become a bottleneck. You have to go at the right pace to accomplish the goals and what your team can handle.

The second one is be data-driven. If you have less than 20 per cent of the information, you're guessing. If you have more than 80 per cent, the market has already moved past you and someone else has figured out. You've got to be able to be comfortable with ambiguity and trust your instinct.

The third one is no surprises. I have a saying – fish, relatives and bad news all stink after three days. Talk to people, be honest and tell them what's going on. They can handle it, but you got to get out there and be front of it.

And the fourth one, which I think is the most important one, is results matter. We have to sell some product, deliver it and keep our employees happy. Otherwise, we'll fail and go back to where we were before.

People will start realising it's about progress, not perfection. It's okay to make mistakes but let's not make the same ones again and again. Have that open and safe culture, and you can accomplish anything.

We’ve spoken to leaders who have realised they can only take their businesses so far. Is this something you’ve noticed?

I see it all the time. Heck, I’ve been my own victim of it. It's like being a parent, the job doesn’t come with an instruction manual. The greatest gift in the world is knowing what you're good at and, more importantly, knowing what you're not good at.

Some people just can't let it go, they'll drive it all the way into the ground. When I work with companies, I try to be very candid, but not hurtful. Normally, I can sense when I'm being too direct. Like when you’re a CEO and you don’t know what your goal is, there’s a problem.

I’ve spent a lot of time in private equity and our goal is always to sell a company for a certain amount of money. But I will get the people within that company around the table and ask them what their goal is.

Some people are talking about selling more product and some about other things but I have never had a complete group agree on the goal. If they don't know that goal, it's not their fault, it's the CEO's fault. How do you expect them to go accomplish it if they don't even know where they're going?

If a leader could do only one thing differently tomorrow, what should it be?

I would say the most important thing you can do is go make something happen. Write out a list of your top 10 things, strike off the bottom nine and just pick that one thing and get everyone around it and get it done. You don't have to be perfect; it just needs to be impactful. This will start to change everything because you start having wins and people will start feeling part of something bigger.

Bill Canady’s book, From panic to profit: Uncover value, boost revenue and grow your business with the 80/20 principle, is available now. Listen to The Turnaround, Business Leader's podcast series that looks into stories of organisations that have turned around their fortunes.