Leadership: Black & Decker solves a cashflow problem

Black & Decker had made a large acquisition.  They erroneously assumed that corporate earnings would facilitate internal funding.  Shortly after the deal closed, revenues from the acquisition went south—the  status quo made internal funding a non starter.  Black and Decker companies were already performing to world-class standards, so demanding a greater contribution to cover the cash flow shortfall was a difficult call for their CEO.

Nolan Archibald knew that he could not manage his way out of a dilemma that he had created—so he chose to lead.  At a meeting of division presidents, he accepted personal responsibility for the failing acquisition decision.  He asked for their help to find a way through a situation that he was responsible for and suggested   tapping the spirtit that had made Black & Decker a success over the decades.  The company had already invested hundreds of thousands of dollars with PR agencies trying to wordsmith a values statement but could never get agreement between all the corporate presidents.   I was asked to open  the problem solving session by explaining the leadership equation from my bestseller, The “I” of the Hurricane: Creating corporate Energy (see archived post, Signal Sending).

The evening before the meeting, a group of senior staffers, visited me at my hotel, wanting to know what I was going to present.  My plan was to facilitate clarification of their cultural-values, explain that when used (rather than just discussed or displayed) wouldprovide the senior team with a powerful profit tool.  The home office group informed me that the meeting was too important to  waste their CEO’s time and that I should stick to discussing my book’s “inspirational-leadership” equation—they had been working on the production of a values statement for over a year with no success.  My statement of purpose (see archived post, CEOs who delegate brand-champion responsibilities may be branding themselves as  incompetent) is “When Theory is not enough” so on ethical grounds, I refused—suggesting they would have to get another speaker.

I went through with the facilitation.  In three hours a set of cultural-values were unanimously and enthusiastically accepted.  The energy generated from the experience fueled a creative session where   division presidents signed up to create ways of moving beyond their current world-class contribution and to  delivering additional earnings to cover their cash-flow shortage.