The Kings, the Princes and the Commoners – an economic fairy tale about turnarounds, transformation and other royal disciplines

But how does a king – sorry, a CEO – actually go about modernising his kingdom? Does he draw his sword? Or is it more likely to be a PowerPoint presentation?

The kings of old had a clear understanding of power: anyone who contradicted them risked losing their head or their life. Modern monarchs in tailor-made suits prefer to rely on staff surveys. It sounds harmless, but it is pure political manoeuvring. For when the CEO listens to the lower ranks, he is rarely referring to the noise of the machinery. He wants to know what information from the people (aka: the workforce) should be incorporated into his royal plans – or at least give the impression that this is the case.

The regional powerbrokers strike back

Yet even if the CEO thinks he holds the reins – in some kingdoms, it is the regional princes who rule. The best example: Migros. The then CEO, Fabrice Zumbrunnen, wanted to force the ten regional co-operatives into greater unity. One kingdom, one will, one plan. But the princes were stubborn. They prefer to rule their own little kingdoms – with their own rules, their own opinions and at their own pace. The end result: Zumbrunnen left – and the princes stayed.

Change is not an Excel spreadsheet, but a drama in several acts. Anyone who believes that change management can be steered by KPIs probably also believed that Brexit would proceed in an orderly fashion.

After all, change is emotional. Even regional leaders – that is to say, managing directors of subsidiaries – feel anxious. They are uncertain. They sense that their familiar world is shaking – even when profits are still looking strong. The board of directors’ rational plan clashes with the emotional response of line managers. And if the tone is wrong, even the best strategy will be of no use.

The three-stage turnaround plan: one third, one third, one third

This is how the script for every classic turnaround goes:

• A third of the workforce is enthusiastic, motivated and keen to get on board. These are the heroes of the new era. They wear hoodies instead of armour, but they fight bravely.
• A third nod in agreement, say ‘yes’, but do only the bare minimum. These are the neutral sheep in the storm. They hope it will all blow over.
• The final third? Well, they are the rebels. They say, either loudly or quietly: ‘It’s always been this way.’ Some put up resistance, some boycott, and some pray for the return of the old boss.

And what is the leadership doing? That’s right – it’s drawing the sword from its sheath: cutting the bottom third. It sounds harsh, but it’s necessary, says the management. Because resistance costs time, money – and nerves. And none of these resources is in plentiful supply during a turnaround.

Das Volk: The most dangerous employees?

According to a Gallup study, around 20 per cent of employees are disengaged – in other words, their minds have long since gone on sabbatical. And if it is precisely this group that suddenly comes up with a host of suggestions, one should be sceptical. Not every quiet waterfall brings fresh spring water.

A turnaround is like dancing on a minefield. If you’re too slow, you’ll be shown the door. If you’re too fast, you’ll overwhelm the team. And if you’re too nice, you’ll lose control.

But how does one lead effectively in times like these?

• Not everyone needs to know everything – but no one should feel sidelined.
• Not everything can be decided by consensus – but ignorance is no virtue.
• Not every suggestion needs to be implemented – but every opinion deserves to be heard.

However, decisions have long since been made in the corridors of power. The battle plans – sorry, business plans – have been drawn up. The charts look impressive, the project name is catchy (‘Phoenix’, ‘NextGen’, ‘#GoFuture’) and the timeline is ambitious.

The king is dead. Long live change!

The king of the modern age must be many things: a strategist, a psychologist, a crisis manager, an orator and, at times, a lightning rod. Because change is painful. For everyone.

But anyone who manages to make the right decisions without alienating the people has grasped the true secret of successful leadership.

Or as they would have said in the Middle Ages: The king is dead. Long live change!