My Unintentional Journey to Turnaround CEO
I’m often asked how I became a Turnaround CEO. As far as I know, there is no school for it. I don’t know of any MBA program that has a course on how to Turnaround distressed companies in its curricula.
Unsurprisingly, my story about becoming a Turnaround CEO has nothing to do with planning to become one or going to school to learn how to transform business. Like most things in life, it was about synchronicity. You know, that thing that Carl Jung referred to as events that are ‘meaningful coincidences’ — events that occur with no causal relationship, yet they seem to be meaningfully related.
In my case, I was on the fast track to senior management at a very large global corporation and I was about to be promoted to Managing Director of one of their largest markets. The company invested tons of time and money to prepare me for the job and I was expecting the promotion within a couple of months. Then the Russian financial crisis (also called the Ruble crisis) hit on August 17, 1998. It resulted in the Russian Central Bank devaluing the Ruble overnight and defaulting on its debt. It was a spillover of the Asian financial crisis that had begun in 1997, driving the price of commodities, such as crude oil, into the ground. These events prompted my employer to freeze all promotions. As for myself, I felt betrayed. I felt like I had been trained to be a Navy Seal, and then told me there was no war for me to fight.
One month into the crisis, I received a call out of nowhere from a leading executive search firm looking for a CEO, however, the job was rather strange. The client was an Eastern European ‘oligarch’ backed by a Houston-based private equity fund. He wanted nothing less than to buy, piece by piece, the state-owned bankrupt oil industry of South Eastern Europe. They saw an opportunity created by the very steep drop in the price of oil ($11/barrel at that time) that created a huge cash hole in these industries, forcing the states that owned them to consider a mass selloff to the private sector.
I wondered why I was considered for the job. I had zero experience in the oil business. I was in my early thirties, quite young compared to the typical age of an oil business CEO. While it’s true that I had been quite successful for my age and that my military background was very helpful with leadership skills, that usually wasn’t major criteria when I was up for consideration for a senior position. However, I didn’t want to decline the request for an interview because I wanted to remain on the radar of this particular executive search firm. So I decided to go, explain why I was the wrong person for the job, and then thank them for considering me. No joke — I even prepared a five-point checklist to demonstrate why I was unfit for the job, including the fact that I had no previous experience in the oil industry.
My future boss was a mountain of a man, with an imposing beard and a sharp look. He looked at me with a funny smile when I gave him my five points. I had always wanted to be ‘ahead of my time’ and demanded senior positions almost from the very moment that I started my first job. It drove me crazy when the response was that I was too young and inexperienced for the position. So, in this interview, my fifth and final point to him was, “I’m sure you think I am too young for the job.” As he would often do over the next 10 years, he reclined back in his chair, took about 20 seconds of silence, and then responded with his deep voice. “I think you are too old for the job.”
This was the last thing I imagined somebody would say to me, and it really caught my attention. In the next 10 minutes, using a large black Montblanc fountain pen, he sketched out how we would buy the badly managed and bankrupt oil assets of Romania, and turn them in the largest oil company in South Eastern Europe. He did this all on a napkin. Afterward, he he explained, “I need somebody that will not panic when faced with disasters, and will lead organizational transformations like a Blitzkrieg.”
Still, he did have his terms. He said he’d give me, on average, 18 months to complete a Turnaround. Then, overnight and without warning, he would move me on to his next company, and I wouldn’t be allowed to bring any of the people I had trained and coached in previous Turnarounds, requiring me to start from scratch with every new company. He would give me very little time, if any, to prepare for the next Turnaround. Essentially, I had to get my bearings and fly the airplane while it was being built.
This meant that while discovering and developing assumptions, I had to act in a way that would persuade the organization to follow my lead. I also knew that the day would come when I would suddenly move on to my next challenge, leaving behind a leadership team and an organization that could continue to fly the plane without me. This became our routine for ten years, resulting in seven successful Turnarounds. Over that time, those combined seven businesses became the largest oil company in South Eastern Europe, and in 2008, we sold them for $3.8 billion.
Eric Kish is the author of Everyday Turnaround — The Science of Daily Business Transformation. This post was originally published here.