What CNBC’s ‘The Profit’ gets wrong
A few years ago I received a call from a television producer who wanted to verify that I was, indeed, a well-known turnaround consultant. This took me back because “well known” was not necessarily in my marketing vocabulary. But I figured if someone from TV wanted to talk to me, I could at least become “less obscure.”
We arranged for a conference call with a number of executives to discuss a possible role on a new reality show.
This would be a life-changing experience, I was sure.
At the appointed hour, one of the executives asked me to demonstrate how I yelled at my clients over their past mistakes.
“I don’t do that,” I said. “People facing financial distress need a plan for the future, not to waste time ruminating over the past.”
Another voice came on. “Tell us how you scream at the clients, telling them that they’re doing everything wrong and you are right.”
“I don’t do that,” I said. “These people are sleepless and anxious. They are looking for a way forward, not drama from me.”
At this point I heard a loud click. And I never heard back from TV land again.
Of course, I realized only later that the products of any television show are conflict and drama, two elements that I find are always destructive to a turnaround in the real world.
A short time later, CNBC produced a new reality show called The Profit, starring Marcus Lemonis, the CEO of Camping World.
Let’s say it’s clear that Lemonis passed his first interview with the producers, because he is an in-your-face reality TV participant from the get-go.
Not that Lemonis is a bad business guy. Many of his messages are right on.
For example, he often diagnoses leadership problems right away.
The boss who doesn’t show up. The manager who refuses to adhere to a set job description. The owners too busy fighting to face practical problems. These are real issues that many troubled businesses face.
Understanding leadership needs strikes me as exactly the right approach. After all, when lack of revenue growth and profitability problems are the symptoms, it is often leadership and organization that is the root cause. I would say that approximately 99% of my clients have leadership issues that, compounded over years and years, have led to business distress.
Lemonis is also quick to demand business clarity. He asks, “What business are you in?” when he encounters owners reaching for profits through ill-conceived diversification. Again, the right instinct. I myself have a model that diagnoses “core products/core customers.” Why? Because there is no way that a company can survive without a focus on its core business. Again, props to Lemonis for a correct instinct.
So that’s two areas in which we appear to agree.
The problem I have with his approach is that he makes himself a central actor in the play. A classic line he uses a lot: “My money, my rules.” This doesn’t work. What if someone comes along with more money? Are his or her rules going to lead the company to profitability because the price is higher? Of course not.
And when he blames the participants for their past mistakes and then tells them that’s why he is right in his approach, he is making a double mistake. Remember: first, no ruminating over the past; second, no drama from the guy who is supposed to be there to help.
Perhaps his approach is rational in a model where he is investing in the failing businesses. The conflict and drama elements not only help TV ratings, they also set the former owners back. That robs them of confidence so that the new owner can do what he wants. Maybe it even fatigues them so they leave the business in the new guy’s hands, allowing him to do what he wants and staff the business with low-cost personnel.
I get that. Because my model is to help companies get back on their feet without causing additional emotional distress, I have a different style. For example, it is often better to ask “we” questions. Like, what if we promoted profitable product A rather than fancy but not-so-profitable product B?
What if we need more sales strength in one area of the country rather than another?
What if we buy components on the outside instead of making them inside?
By asking questions, you bring out the expertise of the participants. It becomes a matter of taking their specialized knowledge and leveraging it against the broader problems that need focus.
Using the word “we” reinforces that it is a team effort between the company and its outside consultant. And within the company, between the various factions that have been fighting over the dying carcass.
The word “I” reinforces the factionalism — “I’m right and you’re wrong” — of the past. Believe me, too much of that and the company goes nowhere.
So “I” works from a reality TV perspective. Lots of conflict and drama. But in the real world, I would take The Profit to the “I” doctor.
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