Organizational Turnaround: It’s All in Your Head

I watched, with interest last evening, the Turnaround King on the National Geographic network.

Yesterday’s episode was a Gold’s Gym franchise in an affluent New Jersey suburb. Unfortunately, it was pushing more red ink than iron. Salesman nonpareil Grant Cardone came in to diagnosis the problems and get it on a profitable footing.

Cardone’s analysis was spot on: There was no reason the franchise should’ve been losing money. But the founders (a father and his two sons) caved to the pressures of local competition and began pricing their gym memberships as a commodity — instead of as the brand leader it is.

Arnold -- making Gold's Gym famous

One of the biggest hurdles for that gym is the mindset of its owners. Despite Cardone’s energy — and the energy and optimism of the gym’s line staff — the owners didn’t seem to get it. They seemed resigned to bankruptcy.

I’ve seen this before and, honestly, I’ve been there before. When competitors get inside your head, it becomes difficult to see clearly.

I remember, in one organization, where someone would pull out the latest annual report of our primary competitor. People would start bemoaning our organization until someone, invariably, would say, “Hey guys. We’re not so bad. Look at what we’ve got…” And we’d all nod our heads in perfunctory agreement.

It wasn’t until we got a new CEO, someone from outside our region, who noticed that we had an “esteem” problem. He was right. (Though some were offended at the statement.) We were so close to the problems and had lowered our own expectations of ourselves (vis-a-vis our competitor) that we considered ourselves beaten.

“…How on earth could we offer patients hope if we, ourselves, didn’t have it?”

Months after his arrival — and with his unbounded enthusiasm and vision — all that turned around. I remember a colleague even making a joke about throwing the aforementioned competitor “a bone” by including it in one of our news releases. (Previously, we would’ve done anything to be mentioned in the same sentence.)

Our organization thrived, and continues to do so today — some 16 years later. That CEO got us to believe in ourselves and our organization. All that much important because it’s in the business of saving lives. And how on earth could we offer patients hope if we, ourselves, didn’t have it?

I wonder if those Gold Gym owners have been able to sustain the enthusiasm and optimism Cardone imparted. Their employees, clients and family members are counting on it. Maybe I’ll check…

(My next piece will focus on the opposite scenario: One in which employees think their organization is better than it is.)