When we are called in — by an owner, a Board, a CEO, sometimes a lender — the first thing we hear is a diagnosis. The portfolio company is underperforming because of a weak commercial team. The cash is bleeding because of supplier costs. The reorganisation is blocked because middle management resists change. The plan is failing because the market has shifted.
These are not lies. The people telling us these things are competent, experienced, and often partially correct. But they are almost never giving us the decisive problem.
Three reasons.
1. The visible problem is the one closest to the symptoms
Cash is the loudest symptom in any organisation. When cash deteriorates, every diagnosis converges on the things that move cash most directly: revenue, costs, working capital. The actual cause may sit several layers behind — a slow erosion of customer relationships that started two years ago, a leadership transition that left a void at the operating level, an external shock that the sector has absorbed unevenly. But the diagnosis tends to stop at the layer where the symptom is loudest, because that is where everyone is looking.
2. The narrators are inside the system
The people who explain the problem are often the same people who built the situation, hired the team that produced the result, or signed off on the strategy now under review. This is not a moral observation; it is a structural one. When you ask someone to diagnose a problem in which they are an actor, they tend to produce a diagnosis shaped by their position in the system. This happens at every level — CEO, CFO, Board, advisers. The further upstream the cause sits, the harder it is to see from the inside.
3. The simple problem is more comfortable than the systemic one
A weak commercial team can be fixed in a quarter. A misaligned operating model cannot — not in the time available, not without rearranging who decides what. When two diagnoses are equally consistent with the evidence and one is operationally cheaper than the other, the organisation will gravitate to the cheaper one.
The cheaper diagnosis is also the one that redistributes the cost of the correction across fewer people. The systemic diagnosis usually requires several decisions to be revisited, several quiet bargains to be reopened, several owners of the problem to be named. The simpler diagnosis preserves more of the existing equilibrium. That is its appeal, and that is also why it rarely fits cases where the company has already tried, and failed, to act on it.
The cost of acting on the wrong diagnosis
The problem is not that the wrong diagnosis is harmless. It is that acting on it wastes the most expensive resource a company has at that moment: time before a decision becomes irreversible.
In many stalled situations, at least one previous intervention has already taken place. A turnaround attempt. An adviser's plan. A reorganisation. The pattern is consistent: the previous work was not bad, it was simply working on the wrong layer of the problem.
What it looks like to look further
Looking past the visible problem is not a matter of cleverness. It is a matter of method.
It means rebuilding the picture from the data, not from the narrative. Tracing the chain of cause across all dimensions of the organisation, not just the one where the symptom is loudest. Treating each diagnosis as a hypothesis to be tested by looking for evidence that would disprove it. Accepting that the answer will often be uncomfortable for someone in the room.
It also means treating the external context as evidence, not as alibi. The same shock — energy, tariffs, demand, a competitor's move — produces different trajectories across companies in the same district, the same supply chain, the same buyer base. The environment explains pressure. It rarely explains the trajectory.
When the work is done well, the moment of recognition is shared in the room. Owners, Board, management see what was actually happening — and the path forward, which had previously felt blocked, becomes clear.
It is rarely the path that anyone had expected.
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References
- The right to decide: A decision-based perspective on corporate stakeholder governance, Strategic Management Journal, August 2025.
- Distretti industriali: export resiliente nel 2025, incognite sul 2026, Intesa Sanpaolo Research, 2026.
- Independent Business Review (IBR), Deutscher AnwaltSpiegel, July 2025.