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Industrial company assigns Interim CEO to investigate potential profitability

A Swedish industrial company has been operating in a European country for more than 10 years without making money. The owners decided to appoint an interim CEO to investigate whether they had the potential to achieve profitability.

The interim CEO tells us: “I started my mission by meeting all the employees where they got to tell us about how they saw the situation. I told them I was new to the business, but wanted to get the situation and the problems explained to me. It was a great way to build trust and I was they told me what was missing. It turned out that confidence in the staff was low and that they were not at all aware of the poor economic situation. The customers were also dissatisfied.”

In step 2, they conducted a two-day workshop to achieve more relaxed conversations. Everyone agreed on the need to recreate the permanent service centre with its own warehouse, which had previously been closed down, and to recruit staff with skills that were lacking.

“For the next step, I visited about 40 customers together with a salesperson. The product was considered good and the price was decent – but the company did not keep its promises and trust was low. I explained our new strategy and got the feedback from customers that if things really turned out as we said, they would come back. They gave us a couple of months.”

They “rebooted” in connection with the opening of the new premises – with a service unit, training facilities, workshop and warehouse. Orders arrived on time and were now delivered the next day, instead of as before 3-4 days later. The trust in us increased and soon sales were multiplied and the ball was rolling. This led to increased motivation and desire for work among employees.

“It’s like changing coaches. I had a different management style – I socialized with the staff on their terms. Today, one third of the staff has been replaced and now there is the necessary skills inhouse. Customers have been coming back and several new ones have been added.”

“An interim CEO must be result-oriented and able to deliver on a limited time. You have to have a strategic ability and know what’s important in the long run, not just saving money right now. Equally important is People Management, the ability to build trust by being humble, listening and not believing that you know everything because you don’t… In a time-limited assignment, you have to be more direct and be able to make tough decisions.”