A new executive is brought in to assume control of a struggling business unit, and during the handover meeting, the departing executive hands the newcomer three numbered envelopes. The recommendation is to open them in case things take a turn for the worse. After two quarters with no improvement in profits and mounting pressure from higher-ups, the new executive recalls the envelopes and decides to open the first one.
Inside the first envelope is a message instructing him to blame his predecessor. The executive dutifully follows the advice and explains to his boss that the previous executive had left a more challenging situation than anticipated. He assures that it will take some additional time to rectify, but reassures that everything is under control. Satisfied with the explanation, the boss shifts attention elsewhere.
Despite the efforts, a few quarters later, the business unit still falls short of its financial projections. Drawing from the lessons of the past, the executive turns to the second envelope, which contains the message “reorganize.” He implements critical changes and intensifies efforts on core strengths. Financial results appear to improve, and less than two years after assuming the role, the business unit faces another crisis.
Feeling out of ideas, the executive retreats to his office, closes the door, and opens the third envelope. The message inside simply says, “Prepare three envelopes.”