The STARS Model
Five business situations requiring fundamentally different leadership transition strategies
STARS is an acronym for five common business situations leaders may find themselves moving into: Start-up, Turnaround, Accelerated growth, Realignment, and Sustaining success. Each situation has fundamentally different challenges, opportunities, and psychological dynamics that demand different leadership approaches.
In start-ups, you assemble capabilities to get something new off the ground. The mood is excited confusion, and your job is to channel energy into productive directions. In turnarounds, you take on a unit recognized to be in deep trouble. People are near despair, and you must provide a concrete plan and confidence. In accelerated growth, the organization is scaling rapidly and needs discipline, structures, and systems. In realignment, you must revitalize a once-successful organization that has drifted toward danger, and the biggest challenge is often piercing denial. In sustaining success, you preserve vitality and find new growth while combating complacency.
Critically, most leaders manage a portfolio mixing several STARS situations across different products, projects, processes, and people. The model also distinguishes between hero leadership (suited to start-ups and turnarounds, requiring rapid decisive action) and steward leadership (suited to realignment and sustaining success, requiring patience, diplomacy, and consensus building).
- There is no one-best-way to lead transitions; the right approach depends entirely on the STARS situation
- Most leaders manage a portfolio of STARS situations, not a single pure type
- Start-ups, turnarounds, and accelerated growth involve resource-intensive construction; realignments and sustaining success involve working within existing constraints
- Turnarounds are ready-fire-aim situations; realignments and sustaining success are ready-aim-fire situations
- The prevailing organizational psychology differs predictably across STARS situations and must be transformed accordingly
- Heroes stumble in realignment situations; stewards struggle in turnarounds
- Performance must be evaluated and rewarded differently across the five situations
- Success in realignment consists of avoiding disaster, which is inherently harder to measure than turnaround success
- 1. Diagnose the High-Level SituationDetermine which STARS category best describes your overall situation. Consider the defining features: is the organization being built from scratch (start-up), recognized as failing (turnaround), scaling rapidly (accelerated growth), drifting toward danger without recognizing it (realignment), or performing well and needing to reach the next level (sustaining success)?Pro tipAsk yourself: What is the prevailing mood of the organization? Excited confusion (start-up), despair (turnaround), growing pains (accelerated growth), denial (realignment), or complacency (sustaining success)? The emotional climate is a strong diagnostic signal.WarningDon't assume your situation is a turnaround just because you prefer the hero role. The most common and most dangerous misdiagnosis is treating a realignment as a turnaround, leading to unnecessary resistance.
- 2. Map Your STARS PortfolioDrill below the high level and assign each element of your responsibilities (products, projects, processes, plants, people) to one of the five STARS categories. Estimate the percentage of effort that should be allocated to each category in the next 90 days.Pro tipBe honest about whether your allocation of effort reflects genuine strategic priorities or just your personal preferences. If you assigned the highest priority to the situation you most prefer, your preferences may be distorting your judgment.WarningYour STARS portfolio will evolve as you learn more. Plan to revisit this diagnosis periodically and adjust your approach accordingly.
- 3. Match Your Leadership ApproachAdapt your leadership style, learning priorities, team building approach, and early-win strategy to match each element of your STARS portfolio. In turnarounds, focus on rapid technical diagnosis and decisive action. In realignments, prioritize cultural and political learning and build awareness of the need for change.Pro tipIdentify whether you are naturally a hero or a steward. Stock your team with people whose natural style complements yours: if you are a hero, ensure you have stewards who can counsel patience; if you are a steward, find heroes who can drive urgent changes in troubled parts of the portfolio.WarningDon't apply turnaround tactics to a realignment. Radical surgery when people don't see a crisis will generate fierce resistance and could end your tenure.
- 4. Transform the Organizational PsychologyWork to shift the prevailing mindset in each part of your STARS portfolio. Channel excited confusion into focus (start-up). Replace despair with a concrete plan and confidence (turnaround). Help people accept discipline and defined processes (accelerated growth). Pierce the veil of denial (realignment). Invent the challenge and combat complacency (sustaining success).Pro tipIn realignment situations, use external benchmarks, respected consultants' assessments, and new performance metrics to create a shared sense that the status quo is not sustainable. Facts from outside the organization carry more weight than a new leader's assertions.WarningIn sustaining-success situations, avoid the trap of trying to create a crisis where none exists just to generate energy. Instead, find authentic growth challenges that keep people motivated.
Watkins introduced the STARS framework in the first edition of The First 90 Days, drawing on his work with hundreds of leaders across diverse situations. He further developed it in a 2009 Harvard Business Review article. Survey data revealed a striking paradox: realignment was rated the most challenging situation (30.3%) but the least preferred (12.7%), while start-up was rated least challenging (13.5%) but most preferred (47.1%), because start-ups are more fun and get more recognition despite being easier.