A proprietor who sells electrical products was experiencing a dramatic drop in sales. He hires a consultant who comes from a large multinational corporation and asks him what can be done.
The consultant suggests that the proprietor develop a vision, mission, objectives, and strategies (VMOS) for his business. The consultant conducts a team-building session with the proprietor and his staff and for several days, they draft and formulate a VMOS. When they finally finish with a fancy-worded VMOS, the consultant presents the VMOS to all the employees and stakeholders. When the consultant went to collect his fee, the proprietor asks the consultant, “so when are we going to talk about my falling sales?”
The phrase, “burning platform” takes its origin from a story about three (3) men on a North Sea oil rig that was on fire. Two (2) men decided to jump into the icy waters while one (1) man opted to stay. The two (2) men who jumped were badly injured from their fall but rescuers were able to save them. The man who stayed on the platform died. Management consultants have cited this story as a lesson that when faced with an urgent crisis, one should take risks and go for deliberate change. Otherwise, if one does nothing, the business dies.
The proprietor of electric relays was on a burning platform; his business was on fire in the form of falling sales. The clueless consultant he hired didn’t address the urgency of the problem. The consultant focused more on what he was good at from being an executive at a multinational. He ignored the crisis happening to the proprietor.
Many managers complain about frequent “fires” that disrupt their daily routines and preoccupy their time and resources. Some executives cite a variety of reasons for these “fires,” from lack of leadership to poor discipline. The executives would form committees, hold strategy meetings, scold managers for poor judgment, or blame poor discipline among rank-and-file employees. Whatever they prescribe, these executives would miss the point that there’s a crisis that urgently needs to be addressed.
Crises, like burning oil platforms, don’t just go away. True, a fire may burn itself out, but even if they did, they’d leave a lot of damage. When there’s a fire, everyone either runs to put it out or runs away. No person in his right mind would just sit there idly by and get himself burned.
Unfortunately, many executives don’t know a crisis even if it’s raging in front of them. It’s what we would call denial, a reaction inherent in human nature. We deny and ignore a crisis to believe it is not happening, that there can’t be a threat.
Most of the client firms I’ve diagnosed have burning platforms. Some are big, some are small; but urgent crises nonetheless that disrupt operations, reduce sales, increase costs, and cause other problems. Burning platforms are often fast-moving fires that eat away the insides of a business and challenge the cores of an organisation.
Managers of course need to address burning platforms. The key is to know that there is one. Sometimes, managers, especially high-level executives, don’t realise they have one. The following are situational examples of burning platforms that executives sometimes ignore until it’s too late:
- Treasury managers pointing out critical cash-flow balances and immediately urging field sales personnel to collect receivables from customers;
- Manufacturing managers alerting purchasing executives that their raw materials are running out because vendors didn’t deliver as scheduled;
- Logistics managers facing a shortage of trucks as senior marketing executives complain of empty supermarket shelves where new products are supposed to be;
- Information system contractors alerting the firm’s chief information officer (CIO) that the company’s data centre’s room’s air-conditioning has broken down and the IT system is in danger of shutting down.
What should an enterprise do about burning platforms? Put them out, of course. What would it take to do it? Everything that one can muster. It is a fire!
- One does not ignore a fire. One works to put it out now and until it’s out;
- And when we say out, we should mean really out, to the extent that whatever caused it won’t ignite again.
The best solution against burning platforms is preventing them in the first place. The means to do that is usually via having relevant and effective monitoring systems and risk management measures.
It starts with having plans and policies that consider potential risks and include contingencies.
These plans and policies should answer questions like:
- What to do when customer collections are falling behind?
- What’s the inventory policy when raw material stocks are running low?
- What’s the plan when projections show not enough trucks next week to deliver orders?
- What’s the backup plan in case the Internet server crashes?
- Who will take over, work from home, or substitute when members of staff are found to be infected with the CoVid-19 virus?
Any plan or policy should have pre-approved procedures against pre-defined crises such that the organisation can immediately take action without having to go through time-consuming justifications to top management. Of course, managers should always notify executives when a crisis is imminent and action should be taken.
Common sense dictates that when there’s a burning platform, we either try putting it out or run for safety. Sometimes, however, we deny there’s a burning platform crisis and we go about our business until we and our enterprises are consumed.
Recognising the existence of a crisis is important but prevention is key to avoiding any crisis. Plans and policies that take into account potential risks, build in contingencies, and allow immediate pre-approved action would help a lot in keeping any new crisis from getting too big if not stifling them at the start.
We should never sit idly by when there’s a crisis and even if there isn’t one.
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