Guiding a company through a turnaround is no easy feat, but CFOs who can do it are in high demand.
Kate O'Sullivan, CFO Magazine
February 1, 2011
Every company needs a timely, solid cash flow forecast - both short term and long term - to provide early warning. Every troubled company I've worked with has lacked this fundamental information.
Posted by Janelle Montgomery | February 02, 2011 10:10 am
I totally agree with the strategies listed here: if you really get a good handle on cash, manage to cut costs (wisely!) and establish honest communication with all stakeholders, chances are you will soon be on the right track for a turnaround. However, I would add another strategy, which I believe goes hand in hand with all of the above and is oftentimes neglected, and that's to have a very close look at all corporate processes and their deep incidence on cash-flow, costs and communications. For example, a purchasing process that does not come with an accurate forecast of all short AND long-term needs of Operations will most likely drive costs higher than they should, including counter-seasonal overages and disruptive shortages. A delivery process that does not support the sales promises and/or the marketing strategy will not make customers very happy, no matter how nicely you will talk to them. A strategic planning process that fails to recognize the true market opportunities and threats will most likely bring the company and its products in a downward spiraling curve sooner than later... To summarize, I believe the turnaround expert should not only be an exceptional analyst and honest communicator, but also gain an in-depth understanding of how all the different functions of the company interact with one another and how cross-functional processes should be (re)structured to minimize costs and maximize the ultimate value of the final product or service delivered by the company. So, ideally, this person should be a combination CFO-COO-CMO, with the communication skills on top of that! A very rare bird indeed!
Posted by Didier Jupillat | February 01, 2011 02:52 pm© CFO Publishing Corporation 2009. All rights reserved.