As of December 31, 2015, the international Turnaround Management Association (TMA) reported that there were 487 Certified Turnaround Professionals (CTP) worldwide. Of those, only 24 of us are women.
When I read the BusinessWeek article, Amid Scandal, the Pope Sticks With Reforms, it occurred to me that Pope Francis is leading an incredibly challenging turnaround. As we all know, the Catholic Church has been faced with both sexual and financial wrongdoing, and Francis seems intent on bringing an end to both. In addition, he is urging a more welcoming and compassionate approach while also expressing his views on global issues.
Any turnaround requires significant change and involves
- Identifying what change is needed
- Defining and implementing specific actions to be taken to achieve that change
- Persuading key stakeholders, at every step of the way, to accept and support the change
Stakeholder persuasion is often the most challenging aspect. It has been said, “If you want to make enemies, try to change something.” Although Francis enjoys broad support both within and outside of the Church, he also faces an entrenched bureaucracy and opposition from “conservatives.” At least some members of those factions, threatened by or disagreeing with his actions, are surely trying to thwart his efforts.
Beneath his kind, gentle-but-strong public presence, Pope Francis must have a spine of steel.
In 2003, I worked as a consultant to R.M. Wade & Co., a 5th-generation family-owned business.
This year—2015—the company is celebrating its 150th anniversary with an absolutely fascinating website, which I urge you to visit. The website includes actual documents and photos from the company’s history, film footage from old ads, newsreels about farm equipment, and—my personal favorite—a poem written by R.M. Wade, himself, about his wagon train journey to Oregon in 1850.
The story behind the company’s success has been described in this Portland Business Journal article and will also be featured in Family Business Magazine.
As you know, it is extremely unusual for family-owned businesses to last this long. Wade’s longevity is a tribute to the family—their intellect, their willingness to change, and, most important, their focus on maintaining strong family relationships.
In January 1987, just 5 months into my career, I received my first turnaround referral from the Special Assets (troubled loan) department of a bank. The client? Pesznecker Brothers. At that time, the company was a 2nd generation family business. There were two banks involved and serious doubt about whether the company could survive. Six months later, after instituting a variety of critical changes and successfully implementing an out-of-court Chapter 11 through which all creditors were ultimately paid in full, the company returned to profitability.
Fast forward to September 5, 2014: Pesznecker Brothers is now a third-generation family business, and the Portland Business Journal just ran a story ( Pesznecker Brothers Business Journal Article ) about a new product developed by the company in partnership with Portland’s Central City Concern, a win-win for both.
These were/are really good people. Turnarounds can be gut wrenching. Owners are asked to make dramatic, sometimes painful changes, and it can take a while to for them to recover. In this case, a year after I left, Dick Pesznecker and Don Ford, the owners at that time, invited me to lunch to thank me.
Since 1987, I have had clients almost 100 times the 1987 size of Pesznecker, but this turnaround remains one of my favorites. Making money is nice, but seeing the lasting fruits of my labor and being appreciated have value beyond measure.
I still display in my home a beautiful copper box, handcrafted by Leo Pesznecker, one of the original founders, and presented to me as a thank you. My photography is not great, but here are two photos: One of the box, itself; the other, Leo’s inscription from the bottom.
If you want to know more about Pesznecker from inception to today, visit About Us on the company’s website.
I suspect that almost everyone hopes that those news publications that provide accurate, thoughtful reporting will continue to thrive in the digital age.
For those of us who live in Portland, Oregon, therefore, it has been difficult to watch the struggles of The Oregonian, long our leading newspaper. In June, The Oregonian announced that it is shifting to four-day-a-week home delivery. Personally, although I do, occasionally, prefer to read “hard copies,” mostly, I love having digital access and, for example, read only the digital versions of The New York Times and The Wall Street Journal.
It is time for The Oregonian to enter the 21st century:
Most urgent: It is way past time for The Oregonian to require readers to pay for access to its on-line content. Much smaller communities figured this out long ago: e.g., the Medford Mail Tribune–a publication in less populous southern Oregon–for more than two years has required payment after a reader has clicked on 10 articles in one month.
People will pay for content that is valuable to them. The question now is: What content will The Oregonian decide to provide in order to attract readers?
If you saw the movie Bernie, you know that ethical issues are not always clear cut. The movie tells the true story of a gregarious, generous-hearted fellow who lived in Carthage, Texas. Everyone in the community loved him, but he killed his wealthy benefactor–shot her in the back four times and stored her body in the freezer.
Bernie should have gone to prison, right? Well…not according to almost everyone who lived in the town of Carthage. His benefactor was less than popular, and Bernie was otherwise such a nice guy and had been so generous to so many needy and appreciative people that almost everyone in the town was willing to give Bernie a “pass.” Pro-Bernie sentiment was so high that the Sheriff requested a change of venue so that Bernie, who had actually admitted to the killing, could be found guilty.
Bernie did go to prison, but this true-life story demonstrates that different people with different life experiences may have very different views about what is right and what is wrong.
The same holds true when it comes to ethical issues that face those who accept turnaround engagements. As you may recall from my article, Deconstructing the Code, which was circulated when I appeared on a panel at the annual conference of the Turnaround Management Association, there are huge disagreements among leading professionals about what is ethical and what is not.
During the annual conference of the Turnaround Management Association (TMA) which was held the last week in October, I attended two sessions about “turnarounds” and was truly taken aback by what I heard.
An underlying theme, articulated by panelists in both sessions was, “We’ve been focusing on fixing the balance sheet. Now we need to learn how to fix the income statement.” Really? What have these people been doing? And does this explain why TMA sessions and publications in recent years have focused on “restructuring” instead of “turnarounds?” (My article which was attached to my last blog post explores this topic.)
Fixing the balance sheet is relatively easy: collecting receivables, reducing inventory, selling unneeded assets, renegotiating debt. Fixing operations is generally more difficult and, in many respects, requires a different skill set. For companies to survive over the longer term, they need to have carefully conceived plans, the right people in place, and effective management control systems. In addition, they must deliver their products and services in ways that are both cost-effective and customer-centric. To me, ensuring that those pieces are in place is a vital role of the turnaround expert. Evidently, not everyone agrees with my view.
To me, the word “turnaround” means fixing the balance sheet AND fixing operations. What does it mean to you?
In July, I was invited to write an article for the conference issue of The Journal of Corporate Renewal, the publication of the Turnaround Management Association (TMA). The topic I selected was “Ethical Issues in Turnaround Engagements.”
Although TMA declined to print the article in the conference issue because they found it to be too controversial, Jack Butler, an internationally recognized partner at Skadden’s corporate restructuring and governance practice, invited me to participate in the Advance Education Panel he is moderating at the TMA Conference in San Diego next week and to include the article in the materials distributed to session attendees. The title for the panel is “Ethical Challenges in Large, Mid and Small Companies.”
I intended the article to be a call to action by TMA, and it will be interesting to see how it plays out. It is my understanding that the article will be shared with TMA’s Strategic Planning Committee as well as the Certification Oversight Committee for the Certified Turnaround Professional program. I have been invited to submit it again for the March issue, which will be devoted to ethical issues, but I certainly hope that the content will be out-of-date by then!
Although I have made some revisions to the original (suggestions for refinements made by several people I interviewed), all of the basic points remain unchanged. Here is a link to the article: Deconstructing the Code.
There’s a very tight lid on communications from Harry and David. I don’t know what’s going on inside, but here are some things I do know:
1. According to media reports, two lawsuits have been filed against Harry and David.
- The first was filed by Drew Reifenberger, Executive Vice President and Chief Customer Officer, who was fired by then-CEO Steven Heyer in January. The basis of the lawsuit? Termination without cause and lack of contractually required payments.
- The second suit, claiming almost $10 million, was filed last week by Convergys Customer Management Group (CCMG). According to the suit, Harry and David and CCMG signed a 2-year contract which required CCMG to provide call center services and to hire an additional 25 full-time personnel during that period. CCMG is requesting payments due under the contract.
2. On February 18th, Harry and David announced the hiring of Kay Hong as “Chief Restructuring Officer and CEO.”
3. Harry and David is hiring. Careerbuilder.com shows 14 jobs that have been posted since Kay Hong was hired. Positions advertised include store managers, Controller, Director of Online Marketing, Director of Market Research, and Manager of Website User Insights. Nothing in the ads indicates that this is a “turnaround” situation.
What is the significance of all of the above?
With regard to the lawsuits
1. When the contract was signed with CCMG in August, did Harry and David’s CEO and upper management realize that Harry and David’s situation was precarious? If so, was it ethical to enter into an agreement it might never be able to honor? Was it wise? If Harry and David’s CEO and board did NOT realize that the situation was precarious, they certainly should have. Any competent turnaround CEO would have known that, but, of course, Wasserstein hired Heyer, who was not, in fact, a turnaround expert.
2. Who signed the contract with CCMG? Was it Heyer, or was it Reifenberger? If it was Heyer, it raises questions about his experience, wisdom, and ethics. If it was Reifenberger, is that part of the reason his employment was terminated? Again, however, responsibility lies with Heyer and the board. One of the first groundrules established by an experienced turnaround CEO is that material contracts require his/her sign off.
3. Is the company not paying CCMG and Reifenberger because it is conserving cash so it can successfully navigate a planned Chapter 11?
With regard to “Chief Restructuring Officer and CEO”—In my experience the title CRO is used primarily in a bankruptcy situation, so the title suggests that the company expected to file Chapter 11 at the time Hong was hired.
Hiring: If you follow my blog, you know that my assessment is that poor quality control coupled with poor customer service have contributed to the problems facing the company, so I am happy to see that they MAY finally be focusing on the customer experience. One caveat, however: when I advertise for positions in turnaround situation, I usually try to let applicants know right away about the situation facing the company. Some people love a challenge. Those are the people I am looking for. I have met many people, however, who have been recruited into troubled situations in which the executives have failed to disclose the company’s situation. Shame on the companies!
On a different note: Perhaps the recruiting is a signal that management believes that Harry and David can, in fact, survive.
I just responded to someone writing a research paper on turnarounds who asked, among other questions, “What are the key ingredients for a successful turnaround?” Here is my answer:
1. Management willing to make needed changes
2. Market for the company’s goods and services
3. Enough cash to get through the crisis
4. Turnaround team with a skill set that is a match for the issues facing the company
I have recently been asked by reporters, “What would you do at Harry and David?”
I responded with a description of the turnaround steps described below. Those steps are always the same, but the specifics vary from project to project. (When I spoke with reporters, I also discussed some of the situation-specific actions I would initiate.)
My S.O.P. (Standard operating procedure)
- Get total control of cash
- Prepare short-term cash forecast
- Select Turnaround Team from key, existing management team members
- Convene the team; go through financial statements line by line–first, looking for ways to improve short-term cash situation, second, identifying ways to increase revenues (and/or margins) and decrease costs — (note: understanding the financial statements inside and out is critical!)
- The result is a written plan that includes a list of who is responsible for achieving what results by which dates and financial projections, which are the numeric representation of the plan.
- Then, it’s time for the team to implement!
- Design and begin implementation of a sound management control system if one does not exist
- In the meantime, there are generally crises to contend with and negotiations with a wide range of stakeholders.
In addition to the above, I also send a web-based confidential survey to all employees. The employees know what’s wrong, what needs to be fixed, and often see things that people at “corporate” miss. Surveys to vendors and customers can be equally enlightening.
The above steps make it sound like the turnaround process is an orderly one, but it’s not. Leading a turnaround is like being a general on the battlefield. It’s messy and fraught with peril. You have a plan, but unexpected crises are constantly arising. I always tell prospective clients that it will feel like the opening scene from Saving Private Ryan. One of my favorite owner/clients used to stop by my office occasionally and say, “I’m having a ‘Saving Private Ryan’ day.”
Someone submitted a comment about my February 16th post in which he pointed out that Kay Hong has been appointed Interim CEO of Harry and David and asked whether I know her and whether her appointment is a good thing.
I haven’t met Kay, but I do know that Harry and David is at a crossroads that definitely requires someone with experience in distressed situations and someone who is strong not only financially but also operationally.
Some comments submitted in response to the Harry and David story in the Oregonian today confirmed my suspicions about what is going on operationally at the company; e.g., complaints about poor product, poor customer service, poor internal systems, and lack of adequate inventory control. All of those will need attention if the company is to prosper.
Most people here in Oregon are partial to our home-grown companies and are pulling for Harry and David to survive. Many jobs and the welfare of the area will be affected by the outcome.
Bill asked some interesting questions, some of which I’ll be addressing in future posts; e.g., why would a distressed company prefer to avoid bankruptcy when in bankruptcy they can shed leases and have other protection? How can you have higher profits with lower revenues?
In the meantime: During the show, I promised to post some key financial statistics for Harry and David from 2006 through 2010. (Their fiscal year-end is approximately the end of June.) Here they are:
I’ll have more to say on this topic later….but from feedback I’ve been getting, it appears that the problems I saw were only the tip of the iceberg.
On the 16th, I promised to provide some unemployment statistics today that will answer this question: The unemployment picture has improved, but where are we compared with prior years? Is this a real turnaround, or are we simply slowly headed in the right direction?
I am going to be a day late because I want to upload a chart from the Bureau of Labor Statistics that provides the promised information, but the download has been frozen yesterday and today. (The website says this is probably due to the Bureau updating the information.)
As soon as the report is available to download, I will fulfill my promise. (But I can give you a hint: It is a pretty pathetic picture.)
Well… after I wrote last night about my frustration with news media reporting only part of a story, my local paper, The Oregonian, ran a wonderful story today by Laura Gunderson describing the success of a local retailer, Kitchen Kaboodle.
According to the story, someone (unnamed in the story) in the company had the idea of being open only on days that are traditionally profitable. Changing the days open plus lowering prices, according to the story, has allowed Kitchen Kaboodle to return to profitability.
The story about Kitchen Kaboodle is one of those unusual circumstances in which the entire story can be told–well, in which the company actually wants to share both the revenue and profit side of the story. Their problems are widely known locally, so it’s helpful for them to share all.
Besides, everyone likes a good turnaround story.
In the 9/20-9/26 edition of Bloomberg BusinessWeek, Matthew Lynn (and the photo that accompanied the article) implied that Stephen Elop, who became CEO of Nokia on 9/21, is not the best person to lead the turnaround because Elop is not a “phone expert.”
I do not know a great deal about Elop except that he was recently “the Canadian head of Microsoft’s business unit” and that he has software experience and a reputation for “shaking up” businesses, but I do know that Lynn’s apparent assumption—that “industry experience” is central to a turnaround—is just plain flawed.
One needs to look no further than Alex Mandel’s leadership of Teligent in the late ‘90’s to see that “industry experience” does not guarantee success. Mandel had been president and COO of AT&T, but Teligent failed spectacularly under his leadership. Although the failure was blamed on “the downturn and overcapacity,” the underlying issue was that on the ground and in the trenches, Teligent was simply unable to provide the reliable wireless services it promised. The lesson: The leadership skills required to launch a technology start-up with no existing infrastructure are very different from those required to lead a long-established company.
In a turnaround, where time truly is “of the essence,” the most valuable commodity is effective leadership, not industry expertise. I’ve had 34 clients. Of those, 3 were in one industry; 2 were in another; the rest were all “one-off.” Based on that experience, it is clear to me that industry experience is not, by any means, the determining factor.
The most important skills needed in leading a turnaround are
· The “power of the glance;” i.e., the ability to see quickly what needs to be done
· Common sense
· Ability to establish the right priorities
· Clarity of vision and the ability to convey that vision
· Ability to mobilize the troops to provide ideas and support the effort
Is having industry expertise a plus? Yes. But it is no substitute for having the right leadership skills. No matter what the industry, it is relatively easy to find someone with industry expertise. It is much more difficult to find someone who has the right leadership skills.
I’m rooting for Stephen Elop and hope he proves Mr. Lynn wrong!
Well, Gregory Meyer was, in fact, added to the board of Blockbuster.
The questions now are:
- Is it too late, anyway?
- Will he be able to have any real impact, or will he be marginalized? After all, the CEO and board strongly opposed to his serving.
Can’t help it–I am fascinated with Gregory Meyer’s challenge to the Blockbuster board. For all I know, Meyer is a total flake, but why would anyone have confidence in the CURRENT board of directors who, by the way, are strongly fighting Meyer’s bid?
Click here for details from my earlier post.
For latest news: Click here.
The board meeting is June 24th… am eager to see whether Meyer gets elected.
One of the headlines today in the New York Times reads, “In Gulf, It Was Unclear Who Was in Charge of Oil Rig.”
If “who was in charge” was, in fact, unclear, it is scary, but, in my experience, too often the case.
Example one: Several years ago, in the process of considering whether to accept a family-owned business client, I interviewed 7 family members, most of whom were in the upper echelons of the business. Because the company had no organization chart, I asked each person to draw one for me. No two charts were the same. The mother-in-law thought the son-in-law was running the company; the son-in-law thought the mother-in-law was running the company. No wonder the company was on the brink of bankruptcy.
Example two: A 25-year-old, FDA-regulated company with operations in both the US and Canada had been cited for FDA infractions before my arrival. Unlike the company in example one, this company had a detailed organization chart and job descriptions for every position, so when I met with the Director of Government Compliance and the Director of Quality Assurance, I asked which one was in charge of ensuring FDA compliance. The two looked at each other. Neither could answer.
You will not be surprised to learn that I solved the non-compliance problem by simply designating one person who had both the responsibility and authority for compliance. As a result, during the first FDA inspection following my departure, the company received its first-ever absolutely “clean” bill of health.
The lesson: Imagine a ship with two captains, each issuing different orders—a symphony, in which the conductor is “conducting,” while the concertmaster is directing the strings. No one would ever consider creating either of those scenarios. That’s Management 101. Why, then, do companies, from small to gigantic, allow that to happen?
Renee’s Rule: You can’t have two captains on the same ship.
As you may know, financier Bennett LeBow recently invested $25 million in Borders and became its Chairman. That $25 million infusion will buy Borders some time, and a combination of savvy marketing and the savvy use of technology may dramatically improve the company’s prospects.
- Technology has transformed the marketing battlefield.
- Although Borders is late to the digital distribution game, the company has a key, not-to-be-discounted asset made valuable through the wonders of current technology: The list of 30-million email addresses they have accumulated through their “free” Borders’ Rewards program.
- That list is a springboard that will allow Borders to promote its new digital offerings rapidly to a massive, already existing database of customers.
- Current technology will allow them not only to reach those customers but also to know the book-buying preferences of those customers. In addition, Borders will be able to send personalize emailed “pitches” to the 30 million—right away—without delay and at a relatively low cost per customer.
- As a result, Borders will likely attract digital book buyers quickly at a low cost-per-customer and per-purchase.
I, personally, would not invest in Borders now, but it’s premature to count them out.
Daily, I receive multiple emails from people who are “interested” in what I do and want to “talk to me about getting into turnarounds.”
Recently, when I explained to one that I have been receiving too many calls to be able to meet with everyone, he told me that one of my competitors is charging $300 per hour to people who want to meet with him for such purposes.
When revenues decline, and profits are non-existent, companies often believe that if they buy or merge with another company, the increased revenues will solve their profitability problems. In my experience, however, these “solutions” often exacerbate the problems.
To be successful, all companies need the essentials:
- A capable leader
- A carefully conceived plan
- A system for ensuring accountability
When these pieces are missing, a joining of two financially and operationally troubled companies is destined to fail.
An example from one of my clients:
- Company A was in an FDA-regulated industry
- The industry was experiencing both intense pricing pressure and consolidation.
- Company A, with multiple manufacturing and distribution facilities, was not only losing money but was also experiencing both product contamination and delivery problems.
- Company A, which was bleeding cash, bought Company B, which was also bleeding cash.
- Neither company had any of the three essentials listed above.
- After the acquisition, the expected “economies of scale” did not materialize; costs for the combined entity actually increased as a percent of revenues.
- The already stressed delivery system was now even more stressed.
- Expected revenues did not materialize because frustrated customers switched to other suppliers.
- Chaos ensued.
We were able to save the company, but it was a close call…..a very close call…..
Two wrongs don’t make a right, and two sick companies do not make a healthy one.
I have concluded that the vast majority of companies today either do not agree with and/or do not care about and/or are clueless about how to implement the above Renee’s Rule™. There is a good chance you have reached the same conclusion. It has become incredibly difficult to get anything done. The simplest tasks have become complicated.
There seems to be widespread recognition that being nice is an important part of customer service, but the other piece–making things easy for customers–has somehow been lost in translation. Personally, what this customer wants/needs is for the companies I deal with to make life really EASY for me. What do you want/need?
As you may have guessed, this post is the result of a my experiencing a spate of bad (abysmal) customer service over the last few weeks. Everyone is NICE; nothing gets DONE--or gets done only with much wasting of time…..I know that you, too, have “been there; done that;” e.g.,
- You are required to enter your phone number to get to tech support, but the first thing the person asks is, “May I have your phone number?”
- You call for repair help. You provide a description of your problem in infinite detail, but the details somehow do not survive the distance between customer service and the people who actually do the repair work, and it takes forever to get the problem solved.
I understand that many of the companies we call could not care less about whether they are wasting our time…but do they have so many customers, and are they making so much money that they don’t want to improve their bottom lines by streamlining their customer service? Think of all the personnel time and $ that would be saved if no one had to ask, “May I have your telephone number?” or if the technical person “on-the-ground” received enough detail from customer service to solve the problem on the first try.
Enough complaining for one day–you can tell I’ve had too much TERRIBLE customer service from too many NICE people….It may be time for a new Renee’s Rule™: Enough is enough!”
In future posts, I’ll share some examples from my personal experience about how companies can reduce costs AND provide better customer service.
Every manager knows the axiom “What gets measured is what gets done,” but too often managers overlook key measurements.
An example: When cash is tight, and profits are lagging, managers, boards of directors and lenders often focus on reducing inventories. Measuring dollar value of inventory and inventory turns can certainly be useful; however, if there is no report that shows the AGE of the inventory (how old the inventory is and whether or not it is obsolete) and no report that measures stockouts, inventory reductions may produce undesirable, unintended consequences.
When a company holds old or obsolete items and reduces the size of its inventory, the dollars tied up in inventory do decline, but the % of “bad” inventory increases, and the entity may find itself without materials needed to deliver orders on time and/ or to stock its shelves with the products that customers want.
In addition, if a company does not write down old or write off obsolete inventory (and, yes, this still happens!), the company is inflating its bottom line. Since financial statements are the scorecard of the business, if financial statements are not accurate, then management’s decisions are based upon misleading information.
Renee’s Rule™: What gets measured matters.
Some years ago, I recruited a first-rate controller to a client company. To accept the position, she had to sell her home and move to a new city to take a job in a troubled company. She proved to be a wonderful person who did a superb job.
Part of her job was to try to get better rates for health insurance, so she contacted several benefits brokers, one of whom landed the account.
Today, I learned that the “winning” broker and controller are getting married, and I am as happy as I can be about it!
In turnarounds, I am always an agent of change–but this is the first time I know about that I was an agent of romance!
In my January 20th post, “Distressed Investing Conference #1,” I wrote, “…the Turnaround Management Association today might more appropriately be called the ‘Restructuring Management Association’ because so much of the educational content focuses on transactions and Chapter 11 rather than on the nuts and bolts of actually fixing distressed companies.”
In the most recent issue of The Journal of Corporate Renewal, in an article, “We are on a dangerous course,” David C. Finkbiner, CTP raised exactly the same issue AND pointed out the ethical conflicts inherent in situations in which “turnaround” experts get a piece of the action for selling companies.
In describing recent Turnaround Management Association panels, he said, among other things,
- For most companies, Chapter 11 is not the best solution.
- Few turnaround professionals are actually doing turnarounds because too many structure their fee arrangements to provide higher compensation for selling a company than for turning it around.
- As a result, many companies that could have been turned around have been sold for less than the value would have been realized had a turnaround occurred.
In response to my email to David saying that I wholeheartedly agreed with his article, he wrote that he had been hearing from “real turnaround people” all over the country–people who actually do TURNAROUNDS–who feel the same way.
I encourage you to read his thoughtful article.
Tomorrow, I’ll be leaving for the TMA’s (Turnaround Management Association’s) Distressed Investing Conference. http://www.turnaround.org/Events/Calendar.aspx?objectId=9313
When I first joined TMA approximately 15 years ago, the members were mostly other turnaround experts, like me, and the sessions focused primarily on turnaround issues. The sessions were filled with practical advice for people who actually turned around troubled companies. Not only did I always leave with valuable tips, but I also identified people who might help my clients survive. For example, Biff Rutenberg, Atlas Partners, was a panelist at one of the first conferences I attended. A couple of years later, when a client with over 60 locations needed to shed some properties and leases, Atlas Partners was a great help to them. http://www.atlaspartners.com/ap/
Today, TMA feels very different to me. Both the industry and the organization have matured. In addition to turnaround experts, the organization now has many lenders, attorneys, accountants, and other service providers, and the emergence of the mega-turnaround firms has changed the landscape.
The changes have expanded the spectrum of resources available to members; however, the Turnaround Management Association today might more appropriately be called the “Restructuring Management Association” because so much of the educational content focuses on transactions and Chapter 11 rather than on the nuts and bolts of actually fixing distressed companies.
I am looking forward to the case studies which promise “operational” content and to seeing people I haven’t seen in years…..
I am watching with interest the controversy swirling around the proposed appointments of Leon Panetta and Sanjay Gupta. Although I do not have enough information to know whether either man is actually right for his proposed job, one thing I know with certainty is that when a dramatic turnaround is needed, that turnaround is almost always best achieved by bringing in a new, effective leader from outside the organization.
In my experience, people within the organization who are capable, competent, and eager for constructive change will welcome and support the efforts of the new leader; those who are not, will not. A strong leader, with the support of the entity’s board of directors can deal with both effectively.
Of course, implementing change within the federal bureaucracy is incredibly challenging. (For a humorous but insightful take on this topic, read Locked in the Cabinet, by Robert Reich.)
“These are the times that try men’s souls” (Thomas Paine, The Crisis, 1776)
As financial troubles roll through the economy, many–possibly, most–companies are seeking ways to ensure their survival. The purpose of this blog is to provide helpful information to
- Businesses, whether they are publicly held or owned by private equity, family, or employees
- Boards of Directors
- Trusted business advisors to whom businesses and their owners turn in times of trouble; e.g., accountants, attorneys, bankers, insurance agents, financial advisors, investment bankers
Based upon my experience as an award-winning turnaround expert, I plan to provide practical advice, comments, and tools that readers can use to improve their business prospects both now and in the future.