When I became CEO, I had no experience running a sales organization. But I quickly realized we had a serious problem: we were growing fast and losing money even faster.
Sales had quadrupled in just a few years. Impressive on paper. But most of that growth came from high-volume, low-margin work—domestic commodity services that barely covered our costs. Our international expansion strategy wasn’t faring any better: expensive trips, few prospects, uncertain returns.
Facing the Brutal Facts
Jim Collins, in Good to Great, talks about confronting the brutal facts while maintaining unwavering faith that you will succeed. This was one of those moments.
Here’s what we were up against:
- Unsustainable pricing. We had won major contracts by bidding aggressively, hoping higher-margin work would follow. It didn’t.
- Global disadvantage. Our largest customers were shifting work to vendors with operations in Europe and Asia. We had none.
- Team misalignment. Our sales team was built for a different era. Many struggled to adapt and started to leave.
It was painful. But necessary.
Rebuilding the Foundation
We started with deep analysis. What did each major account actually cost us? Which programs were worth keeping? Where could we raise prices or renegotiate? What did “good business” really look like for us?
Next, we shifted our sales leadership. We brought in a new VP with experience in high-value, engineered products—a better match for our capabilities. Together, we redefined our offering and our criteria for pursuing new opportunities.
Finally, we made the hard calls. We exited unprofitable business. We right-sized our team. And we reinvested in areas where we had clear strategic advantage.
The Turnaround Begins
As we made these changes, something remarkable happened. Margins improved. Morale stabilized. And we began attracting the kind of work we actually wanted to do—the kind that made sense for us and for our customers.
We weren’t just selling more. We were selling smarter.
Reflection Questions
- Are your top-line growth numbers masking deeper profitability issues?
- Where in your business are you accepting bad work for the illusion of momentum?
- What criteria do you use to define “good business” for your organization today?
In the next post, I’ll explore how we tackled operational challenges that were dragging us down—and how aligning people, process, and purpose helped us turn the corner.