Burn the Boats! How to Know if Your Business Has Reached the Point of No Return

Today I’m sharing with you a terrific post from friend and CCI contributor Linda Henman. She’s one of those rare experts who can say she’s a coach, consultant, speaker and author. She works with Fortune 500 companies and small businesses that want to think strategically, grow dramatically, promote intelligently, and compete successfully.

Has your company reached a “Point of No Return,” signaling it’s time for a dramatic change? Henman tells us how to know when that happens – and what to do:

By Linda Henman

Conquerors tend not to enjoy a laudable place in the history books, but they do offer lessons in how to get more without settling for less. Pilots refer to PNR—the point of no return. This technical term in air navigation refers to the point in a flight at which, due to fuel consumption, a plane no longer has the capacity to return to its home base. To inspire innovation and reinvention, businesses often face a PNR too, a point in their history when they need to metaphorically burn the boats that brought them.

In 1519, Heran Cortes landed in Mexico with 600 Spaniards and 11 boats. The conquistador and his men had just embarked on a conquest of the Aztec empire, a kingdom that hoarded a cache of the world’s greatest treasures—gold, silver and precious jewels. Cortes undertook this mission knowing that, for centuries, other conquerors with far more resources had attempted to colonize the Yucatan Peninsula, but none had ever succeeded. Cortes changed the course of history, however, with just three words: “Burn the boats.”

Cortes wasn’t the first man to ensure victory using a bold strategic decision, however. A thousand years earlier, Alexander the Great also burned his boats upon arrival on the shores of Persia. Like Cortes, Alexander the Great faced insurmountable odds and an army that far outnumbered his own. He too ordered the boats burned with the cry, “We go home in Persian ships, or we die.”

Companies like Kodak faced a burn-the-boats period in their history when they realized they had to switch from selling only hard products to offering digital services. Dell too burned their direct selling model and began to sell through retailers.

In 1971, Darwin Smith took the helm of Kimberly-Clark, a company founded in 1872 in Neenah, Wisconsin as a newsprint company. The company broadened its operation in the 1920s to introduce Kleenex, the first throw-away tissue and developed a system to produce coated paper and paper for books, too.

Shortly after he took the chief executive position, Smith sold off large interests in coated paper and closed the inefficient mills, a burn-the-boats decision that engendered appalling ridicule. With this new direction, new focus on new consumer products and fresh stash of cash, Smith renamed Huggies, a disposable diaper that would compete successfully with the leading brand, Pampers, and eventually take the first-place position against Proctor and Gamble.

Baseball star turned philosopher, Yogi Berra, once said, “In theory, there is no difference between theory and practice. In practice, there is.” Getting more without settling for less demands a new approach in both theory and practice. Not all companies need to burn their boats, but no successful organization exists without a clear strategy about what the organization needs to do and clear direction and decisions for and about the people who will do it. To discover how you can better tie your strategy and talent decisions together to achieve the results you want, ask these questions:

• If we weren’t already doing this, would we start?
• Are we tempted to major in the minors?
• What counts that we aren’t counting?
• Will we be relevant in five years?
• How many of our stars would leave for a 10 percent raise?

• You may have already reached the PNR in your strategy, and it’s time to burn the boats. But make sure you have before you maroon the company on a deserted island of the wrong strategy.

Linda Henman holds a Ph.D. in organizational systems and two Master of Arts degrees in both interpersonal communication and organization development and a Bachelor of Science degree in communication. Whether coaching executives or members of the board, Linda offers clients coaching and consulting solutions that are pragmatic in their approach and sound in their foundation—all designed to create exceptional organizations.

She is the author of Landing in the Executive Chair: How to Excel in the Hot Seat ,The Magnetic Boss: How to Become the Leader No One Wants to Leave, and contributing editor and author to Small Group Communication, among other works.

Some of her clients include Emerson Electric, Boeing, Avon and Tyson Foods. She was one of eight experts who worked directly with John Tyson after his company’s acquisition of International Beef Products, one of the most successful acquisitions of the 20th century

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 Maurice Gilbert is Managing Partner of Conselium Executive Search, which specializes in placing Compliance Officers and Legal Counsel for clients in the U.S., Europe, Latin America and Asia Pacific. Maurice is also CEO of Corporate Compliance Insights, a worldwide publication devoted to governance, risk and compliance issues. Maurice can be reached at maurice@conselium.com .