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Looking for the Light

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

Keep an eye on cash always

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

Let's not forget processes!

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

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