If you were in charge at Twitter – what would you do?
How could you tell your choice was a good one?
Nowhere have there been more examples of the agony and the ecstasy among young organizations than the tech sector. Darlings rise and fall, regroup and rise again. One of the most innovative and impressive among the recent stories is Twitter. However, the last year has been tough:
- Twitter stock price continues to slide. (-55% in the last 12 months)
- Other key members of the Management team depart. (4 of 10 after a change in CEO last year)
Anytime an executive chooses to act, she looks at the presenting facts, assigns a meaning to each and choose a course to follow. Granted, there are many more facts to the Twitter situation, but let’s stick to these two prominent pieces of data. The loss of share price and the executive departures lead to a number of intriguing interpretations:
Twitter’s failure to produce profits is catching up with them. For a long time, Twitter’s level of activity and infatuation among its users has been so compelling investor confidence has remained committed to “the promise” of its potential.
The real shareholder confidence was rooted in the leadership talent there. Given the recent departures it is unclear if the shareholder confidence is rattled by a lessening of the talent, or a belief that disruptions caused by executive turnover will delay the long-awaited turnaround demanded by the loss of nearly half the stock’s value over the last year.
The slowdown in new user subscriptions is an outcome of Twitter’s “insular nature” that is, the concern that the board, made up of too many insiders, led to an inability to create the adaptation and innovation Twitter must demonstrate to become what CEO Jack Dorsey envisions as “the first thing people check when they wake up.”
So if you were the CEO, which of these interpretations would drive your next steps?
#1 would drive you to pick new executive team members who could drive monetization. These folks might be very different than the people currently operating in the culture.
#2 might drive some internal promotions to minimize disruption or luring a superstar who could buy time while the turnaround gets going.
#3 might be the most disruptive of all. If the CEO interprets the problem as cultural, the replacement of the departed executives is a lesser problem to encourage better upward communication and challenging existing practices.
What would you do? Stay tuned to the choices Mr. Dorsey makes. Remember, if you think this is complex, he also is CEO at Square Inc. How much have you got going on this week where you work?