Why your best leaders quit during a turnaround – and how to keep them

We see it again and again. The company enters a turnaround. The focus shifts to costs, processes, and restructuring. Six months later, three of the most critical people have handed in their notice.

Identify the people who drive revenue

A while ago we sat with a CEO who had lost his sales director in the middle of a turnaround. "But he didn't even report to the management team," he said.

Don't look at titles. Look at what is actually happening. Who drives revenue? Who have customers been calling for the last six months when things were on fire? If that person leaves – how long before it hits your liquidity?

We always ask the same question: who would the business stop running without if they were gone for three months? The answer usually surprises people. It rarely needs to be the person sitting on the management team. It is the controller who keeps the forecast together. The production manager that three large customers call directly. The project manager who knows where all the bodies are buried.

Those are the people you have to identify on day one.

Incentives that motivate

A CFO recently turned down a substantial retention bonus. He went to a competitor instead. Why?

"I had responsibility for the entire restructuring but couldn't make a single decision without going through the CEO and the board. I wrote reports. I wanted to solve problems."

Financial incentives work – but only if they come with real authority. Control. Over the budget. Over hiring. Over which suppliers you use.

Give them a piece of the upside – a bonus tied to turnaround targets, options, real numbers to own. But also give them the tools to influence those numbers. Otherwise you are only buying time, not commitment.

The turnaround plan they don't understand, they won't believe in

A CEO presented the turnaround plan to his management team. Polished slides. Clear targets.

Two weeks later: "I honestly don't understand how my part affects the whole. And I don't know if this is going to work."

Don't start with the plan. Start with the why. What happens if you don't succeed? Concretely. Then – why these specific people are sitting in the room. What is everyone responsible for in the process?

Tie the plan to each individual. Not generally. "Your production line accounts for 40% of the margin – here is what has to happen in the first 90 days."

And then – and this matters – let them challenge it. The ones who own their part of the plan stay. The ones who only get orders disappear.

How to keep them

Identify who actually creates value. Before titles, before hierarchy. Give them real authority, not just responsibility. Tie their role to the outcome so they understand why they are critical. Follow up regularly – not for control, but to show that they are central.