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Several years ago I started doing a presentation on lessons in turnaround brand building. The presentation features strategic lessons in building a brand from the brink of collapse to tremendous success. The lessons are applicable to not only brands, but also to departments in companies, projects, and even personal life. With the subsequent dramatic economic meltdown, many once-stellar brands have disappeared for various reasons and a new niche has developed in predicting whether a brand will vanish in the near-term based on various warning signs.

In these cases, any type of attempted strategic brand turnaround has obviously failed. In my own corporate brand strategy experience, I witnessed a significant unraveling of the incredible turnaround and brand building work that had been done. As an early step in refreshing and re-orienting the turnaround branding content, here are five observations about what happens to strategic thinking when a brand is in distress. Consider these early warning signs for a potential brand collapse:

1. Detaching from the brand’s strategic foundation

When the economy is in crisis, it seems almost fashionable to abandon strategic efforts. That’s a dangerous strategy (or absence of one). I met with a CEO last year who said outright his business wouldn’t be doing ANYTHING strategic for at least six months. What a complete misunderstanding of the concept! The company was engaged in all kinds of financial maneuvers (which were strategic, albeit near-term) to survive while ignoring the very strategic upside opportunities it couldn’t afford to put off if it were going to turn around its fortunes.

2. Disdaining and compartmentalizing creativity

I know, the IBM CEO study said CEOs value and want more creativity to deal with uncertain times. Maybe so (although I’m skeptical as I wrote last week), but companies are full of left-brain senior managers who don’t appreciate creative problem solving. They may also start trying to compartmentalize creativity to certain functions or topics. That’s a warning sign, because creativity is broadly vital during challenging and ambiguous situations. Creativity isn’t simply for cooking up creative financing schemes to try and keep a business afloat.

3. Telling employees to not think but just act

A disdain for thinking certainly runs through the other items on the list. When senior executives are telling people to not over-think and just get on with stuff, it’s a clear warning sign. Maybe it is a slow-moving organization stalling innovation efforts which are ready to be implemented. But a “don’t think, do” motto is used frequently as an excuse to not consider an appropriate variety of fact-based strategic options or to avoid exposing flawed strategies when they should be modified or shot down. This warning sign is a harbinger of hearing the age old cop-out, “I was just following orders.”

4. Using policy in place of good decision making

Making decisions in a challenging business situation is hard, especially for a big corporation. It means having to think through the ripple effects of decisions or adapting decision making principles to many situations based on specific issues at hand. An alternative, which can be overused, is to take the easy way out and enforce strict policy to displace strategic decision making. For example, telling every department to cut its budget 25% when the smarter strategic approach is really understanding critical business areas and making strategic decisions to fit each situation. Leading with policy over decision making is fast, but it’s sloppy and potentially crippling when used too frequently.

5. Making decisions based on what you like, not on facts

When business decisions are being made based on what people like and don’t like, be very afraid. It’s impossible to completely remove personal preference from thinking and decision making, but business isn’t a Facebook page – liking and not liking (especially when the person speaking isn’t in the target market) isn’t a good starting place for strategic decisions.  If the early questions aren’t about what matters for the business and how customers will react (yes, even whether they’ll like the idea or not), big problems are looming.

What strategic thinking warning signs do you see in brands being challenged or teetering on the brink? I’d love to get your reactions to these five and others you have seen play out in your experience in the comments. – Mike Brown

The Brainzooming Group helps make smart organizations more successful by rapidly expanding their strategic options and creating innovative plans they can efficiently implement.  To learn how we can bring out the best innovative thinking in your team email us at brainzooming@gmail.com or call us at 816-509-5320.

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Mike Brown

Founder of The Brainzooming Group, and an expert on strategy, creativity, and innovation. Mike is a frequent speaker on innovation, strategic thinking, and social media.

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9 Responses to “Is Your Brand Headed for Trouble? 5 Strategic Warning Signs”

  1. Quinn says:

    Great post Mike. I’d like to add a point. I always think it’s a bad sign when a company stops promoting from within. Whether it is that no one can seem to break through to management because they bring in new people or that higher positions are all of a sudden in short supply, a company that wants its people to remain stagnant in a position usually indicates a lack of faith in the company’s future in my opinion.

  2. Liz Craig says:

    Mike, your article is so spot-on.

    I’m not naming names, but I’ve worked for more companies that adopt the ostrich posture when in trouble than those that don’t. Either that, or they enlist the HR department to create “team-building,” rah-rah events, have t-shirts and mugs printed up and hope to build better morale, instead of addressing the problems that are destroying morale.

    The companies that are clear-eyed about problems and willing to take appropriate actions are the ones that succeed in the long run.

  3. Mike Brown says:

    Appreciate the comments from both of you (and great to meet you IRL today at the Jeff Pulver appearance Liz!).

    There’s definitely an issue when nobody inside has an opportunity for promotion, Quinn. But there are times when a company really does need an infusion of new people. Having lived through multiple phases in a corporate environment where new people were brought in at senior levels throughout the company, the results were mixed. While there were many burn-outs (because they didn’t “get” the culture and how to work it), there were some outstanding successes which really sustained and reinvigorated the company. If someone inside a company really feels as if they’ve been legitimately passed over, then they owe it to themselves to work harder to make an impact where they are or go somewhere else where their value will be better recognized.

    You’re certainly right Liz that many companies find it much easier to ignore problems than address. Others may address some of the issues, but not be able to sustain what amounts to a multi-front battle at times of crisis. Emotion and excitement are important, but they can’t be “dessert” when there’s no “dinner” and be effective. They have to go hand-in-hand with real, positive change in a business to be meaningful!

  4. Jim Joseph says:

    I’m particularly sensitive to the “policy” vs “good decisions”. I believe that much of marketing is about making good decisions. Marketing should be based on strategy and the marketplace, which is always changing …. not on policy which tends to be very stagnant. Great post, Mike! Jim.

    • Mike Brown says:

      The challenge is often Jim when groups outside marketing are mandating the policy-based decisions. Leads to some long conversations about make smart decisions vs. wholesale cuts or changes.

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