The Counterintuitive Wisdom of Turning Things Around

All healthy organizations are alike, each struggling organization is struggling in its own way.

When organizations face mounting pressure to improve performance, leaders confront a fundamental choice: cut costs and streamline operations, or invest more resources to power through challenges. This decision often splits leadership teams and creates heated boardroom debates. The answer, however, isn’t found in the strategy itself—it’s found in honestly assessing organizational health first.

The Strategic Dilemma

The “cut-it-down” advocates make a compelling case. Reducing resources forces radical focus on what truly matters, eliminates waste, and stops the bleeding on underperforming initiatives. Constraints, they argue, spark creativity and innovation. When teams have fewer people and smaller budgets, they find ingenious ways to optimize and achieve more with less.

The “double-down” proponents counter with equal conviction. They contend that retreating during crisis only weakens the organization further. Instead of cutting what works alongside what doesn’t, smart leaders should identify successful elements and amplify them. Some systemic challenges, they insist, require more resources to solve—not fewer.

Both sides sound reasonable because both can work. The critical factor isn’t which strategy you choose, but when you choose it.

The Health Diagnostic Framework

Think of your organization like a patient presenting symptoms. The same treatment that helps a healthy person recover from illness could seriously harm someone with underlying conditions. Similarly, organizational strategies that work brilliantly for healthy organizations can devastate struggling ones.

Healthy organizations typically exhibit:

• Strong leadership and clear decision-making processes
• Minimal operational and technical debt
• Cultural alignment around core values and goals
• Ability to execute initiatives efficiently

⠀Struggling organizations often show:

• Chronic leadership and management problems
• Accumulated operational, technical, and cultural debt
• Misaligned priorities and competing agendas
• History of failed execution on major initiatives

Applying the Right Strategy

For healthy organizations facing temporary challenges: Cut-and-focus strategies work exceptionally well. These organizations have the operational agility to do more with less. Their strong foundations allow them to weather resource constraints while maintaining quality and innovation. The reduced complexity actually enhances their natural efficiency.

Example: A well-run software company facing a market downturn can streamline product lines, reduce headcount strategically, and emerge stronger with clearer focus and leaner operations.

For struggling organizations in crisis: Double-down approaches become necessary. These organizations lack the agility to execute effectively with fewer resources. Their underlying problems—poor communication, technical debt, misaligned teams—will only intensify under resource pressure. They need investment to address root causes before they can operate efficiently.

Example: A manufacturing company with outdated systems, poor quality control, and leadership turnover needs to invest in new technology, training, and management before cost-cutting can be effective.

Diagnostic Questions for Leaders

Before choosing your strategy, honestly assess your organization:

1. Execution track record: Do we consistently deliver on major initiatives on time and budget?
2. Leadership effectiveness: Do our managers make clear decisions and communicate well?
3. Technical and operational debt: Are we constantly firefighting issues that should have been fixed long ago?
4. Cultural alignment: Do teams work toward common goals, or do we have competing priorities?
5. Change agility: When we need to pivot quickly, can we execute smoothly?

If you answered “no” to most questions, you likely need investment before optimization. If you answered “yes,” strategic cuts can unlock significant improvements.

The Stakes of Getting It Wrong

Choosing incorrectly carries serious consequences. Healthy organizations that over-invest during downturns waste resources and lose competitive advantage. But the reverse mistake—cutting resources in unhealthy organizations—often proves fatal. These organizations cannot achieve the operational excellence that lean strategies require, leading to quality problems, employee burnout, and accelerated decline.

Moving Forward

The most successful leaders resist one-size-fits-all approaches. They diagnose organizational health first, then choose strategies that match their current reality. This requires uncomfortable honesty about your organization’s true capabilities and limitations.

Remember: productivity is built through systematic improvement, revenue is earned through consistent execution, and sustainable results come from matching strategy to organizational capacity. The wisdom lies not in knowing which approach is better, but in knowing which approach fits your organization today.

How healthy is your organization? The answer should drive your next strategic decision.

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