When profits are decreasing, stock prices are dropping, and losses are reaching unprecedented levels, it requires remarkable bravery, strong leadership abilities, successful corporate restructuring, and business revival strategies to turn a company around. Failure should not be disregarded by anyone, particularly by those we look up to. It is through their failures that these remarkable individuals learned, developed, and eventually achieved success. Here are the five leaders who took charge of the dying business with their vision, perseverance, and some tough decision-making; they not only made the company profitable but also took it to new heights.
Lee Lacocca, Chrysler Motor
After being dismissed as president of Ford Motors in 1978, Lee Lacocca took on the challenge of saving Chrysler Motor, a well-known company facing bankruptcy. Lee renegotiated agreements with car rental companies, reduced the workforce, and secured $1.5 billion in loans taken by the federal government as part of a groundbreaking bailout. He successfully revived Chrysler, beginning with the K-car line in 1981, including the compact to mid-sized vehicles. Succeeded with that, he launched the first minivans—the Dodge Caravan and Plymouth Voyager, setting a new standard for family-oriented transportation. According to reports, in 1983, Chrysler earnings of $925 million and was able to repay the government loans.
To overcome the hurdles, Lee organized a marketing campaign to give importance to the quality, dependability, and affordability of Chrysler's vehicles. This approach effectively repositioned the brand in the marketplace and began restoring consumer trust. However, his innovations didn't end there. Lee launched groundbreaking models, such as the fuel-efficient K-cars, which appealed to buyers. Besides, one of his most notable contributions was the introduction of the minivan to the market, transforming the automotive sector and addressing the evolving needs of families throughout the country.
Gordon Bethune, Continental Airlines
Gordon Bethune joined the company as it was transitioning out of Chapter 11 bankruptcy protection. At that time, Continental Airlines was losing $55 million each month and consistently ranked last in all measurable performance indicators, including on-time arrivals, customer complaints, and lost baggage. Under Gordon's guidance, the airline cut unprofitable routes, enhanced services from its hubs, renegotiated debts and leases, and implemented an incentive pay structure that significantly improved the airline's on-time landing record. During his tenure, Continental's stock price surged from $2 per share to over $50 per share.
James R. Cantalupo, McDonald’s
James Cantalupo, who had stepped down as president of McDonald’s International in 2001, was persuaded to come out of retirement to improve McDonald’s declining U.S. sales, which had been falling for over two years. The fast-food chain was seen as offering unhealthy food options, which conflicted with consumers’ growing interest in healthier choices. To cater to health-conscious customers, James launched salads, apple slices, and a low-carb menu in some markets. By early 2003, James’ achievements were clear, with first-quarter net income rising to $327.4 million, compared to $253.1 million the previous year. This led to a significant and sustained increase in the company's stock value.
Howard Schultz, Chairman and CEO of Starbucks Corporation
Howard Schultz, the Chairman and CEO of Starbucks Corporation, embodies the quintessential American entrepreneur. He was raised in a working-class neighborhood in Brooklyn and became the first in his family to go to college. Today, he has a net worth exceeding $2.2 billion, and the brand he built from the ground up is among the top 100 in America, now valued at more than $60 billion. With a growth trajectory that many business owners aspire to, Howard took the company from a single coffee shop in Seattle in 1986 to over 20,000 locations worldwide. However, the initial rapid success of Starbucks nearly led to its downfall in 2007. Howard’s journey reflects a path from achievement to adversity and back again.
In 2007, challenges began to surface for Starbucks. Some of these issues were beyond Howard’s influence such as the economy was on the brink of recession, causing Starbucks coffee to become a luxury that fewer people could afford daily. The shift in consumer habits was not only due to financial constraints; there was also a cultural move toward supporting local businesses and brands that showcased ethical and environmentally friendly practices rather than large corporations.
Although Starbucks had been at the forefront of employee benefits and ethically sourced coffee, its growth failed to communicate that narrative effectively.
Consequently, Starbucks became viewed as the kind of company consumers should steer clear of—an enormous, greedy corporation that drove local coffee shops out of business and charged customers a premium for coffee. Howard began by addressing the coffee issues. In 2008, he temporarily shut down 7,100 stores to retrain baristas on how to make the perfect espresso. The company lost $6 million that day, and the media seized the opportunity, interpreting the closures as a sign of impending doom. Nevertheless, Howard recognized the critical importance of perfecting the coffee preparation.
Jeff Bezos, founder and CEO, Amazon.com
Jeff Bezos, the founder and CEO of Amazon.com, is hardly seen as a failure. As one of the wealthiest individuals globally, he has been recognized as “Person of the Year” by Time Magazine and “Businessperson of the Year” by Fortune. His company generated $75 billion in revenue last year and has a valuation of $150 billion, making it the second most valuable e-commerce business (just after Alibaba). However, in the initial years of Amazon, Jeff made more mistakes than many people experienced in their entire lives. At the very least, he incurred costs from more significant errors than most of us, totaling hundreds of millions of dollars in what he has referred to as poor decisions. In 1998, the nascent Amazon.com dealt in books, music, and movies, rapidly establishing itself as a leader in those fields. The company garnered substantial venture capital, and Jeff envisioned transforming Amazon into an everything store.