# Inverse response _When the numbers get worse after you make changes, the hardest move is to hold steady._ --- You take over a business unit mid-year. The P&L is ugly: margins below breakeven on a third of the customer base, a quality backlog that support staff have been patching manually for eighteen months, and a churn rate that ticks up every quarter. On day one you sit in a client call where a customer service rep apologises for the same bug for the fourth time. The team knows what's broken. They've been waiting for someone with the authority to actually fix it. You make the changes. Exit three unprofitable contracts that consume a disproportionate share of support time. Reassign two engineers from feature work to root-cause fixes. Reset delivery timelines with the four biggest accounts, honest about what's been promised versus what can be shipped. Raise the hiring bar, which means two open roles stay unfilled longer than the team would like. Three months later, every metric you report to the board has moved the wrong direction. Revenue is down because you exited contracts. Costs are up because root-cause work doesn't ship features. Satisfaction scores dipped because you told customers the truth about timelines. Headcount is below plan because you refused to hire for the sake of filling seats. Every one of these was the right call. And every one looks identical to "new leader making things worse." --- This is the moment that separates leaders who transform a business from those who oscillate between initiatives until someone replaces them. Some systems move the wrong way first when you apply the correct input. Push them in the right direction and the initial response is backwards, then it corrects. The danger is fighting the initial movement. If you see the numbers drop and overcorrect, you amplify the problem. Reverse the changes, and you've paid the transition costs twice, once going in and once coming out, without getting the benefit. Worse, you've taught the organisation that change initiatives don't stick. The correct response is to hold steady and let the system work through it. --- You know this. The question is whether anyone else believes it. You watch the board review the quarterly numbers. The revenue line is down. The margin line is down. The satisfaction score is down. The conversation shifts from "what's the plan" to "is this person the right fit." You hear the strain from the team too: they're doing harder work than before, the kind that doesn't produce visible wins, and the scoreboard says they're losing. Everyone is watching the chart move the wrong direction, asking the same question: is this person fixing the business, or destroying value? --- You can't avoid the dip. What you can control is whether stakeholders trust you through it. **Predict it in advance.** Before the numbers turn, tell people what's coming and why. "We'll see margins compress in Q1 as we exit low-value contracts. By Q3, the remaining book will be healthier." This transforms the dip from evidence of failure into confirmation of the plan. **Define leading indicators.** Lagging metrics, revenue, profit, NPS, will look bad while the system corrects. But leading indicators should move first: pipeline quality, employee engagement, defect rates, [[Measuring retention|customer retention]] in target segments. These show the change is working before the headline numbers reflect it. **Set time horizons.** "If we don't see X by month six, we'll revisit the approach." This creates a decision point, a moment where you and the board can distinguish a dip from genuine failure. Without it, you're asking for indefinite faith. --- The leaders who fail turnarounds usually fail one of two ways. They panic and reverse. They see the dip, lose nerve, and undo the changes. Now you've incurred the transition costs twice without getting the benefit, and the organisation learns that if it waits long enough, every initiative blows over. Or they fail to prepare stakeholders. They make the right changes but don't prepare the board for the dip. When the numbers drop, the board loses confidence and pulls the plug before the system can correct. The leader was right about the mechanics but wrong about the politics. Both look like failed transformation. Neither was actually a failure of strategy. --- The hard part: a genuine dip and genuine failure look the same at first. Both show the numbers moving the wrong way. The difference is in the leading indicators. When the system is restructuring, early signals of health appear even while lagging metrics decline. Pipeline quality improves. Defect rates fall. The customers you kept are buying more. When the strategy is genuinely wrong, everything deteriorates together. Leading and lagging indicators move in the same direction, and the team feels it before the numbers confirm it. If you understand the dynamics of your system, you can predict what the dip should look like: which metrics drop, by how much, and for how long. When reality matches that prediction, hold steady. When it doesn't, course correct. Engineers call this a right-half-plane zero: a system that moves the wrong way before it moves the right way. Neither blind faith nor reactive panic. Have a model, watch for confirmation, and know in advance what would change your mind. ---