Finance Monthly - September 2022

to that person and provide proper support. If there is not a qualified leader in the company – and there often isn’t – don’t hesitate to go outside the company to locate a professional for this job. The leader must get directly involved in making decisions to achieve the ultimate goal — turnaround and sale at increased valuation. They must be held accountable for performance and timely results. Most importantly, they must get things moving. On the revenue/sales side, look at where and how revenue is generated and keep it coming. On the throughput/production side, get the product or service out the door. How else can you bill for it? To complete the turn, hire a marquee manager to lead the enduring team. This permanent team adds to value equation. Set Strategy An effective strategy is key to implementing change. You must establish a new vision, distil this direction into concrete goals and objectives, and create a guide for all stakeholders to follow. Rebuilding momentum is critical to success. Focus on a newperspective of what is going on and fix it. Question: • Is the business viable? Turnable? • What is the purpose of the business? • Should it be saved? Why? Are these reasons valid? • Is there a core business that can be the foundation for the emerging business? • Are there sufficient cash resources to fuel the recovery? • Are there existing managers capable of leading parts of the company? Remember, not all companies are salvageable. Identify effective turnaround strategies. Operational strategies include increasing revenue, reducing costs, selling and redeploying assets, and establishing competitive repositioning. Strategic initiatives include adopting sound corporate and business strategies and tactics and setting specific goals and objectives that align with ultimate stakeholder goals. Too often, goals are misaligned with the ultimate direction and lead to confusion, wasted time, false starts, and employees sent in the wrong direction. Build a Quality Management Team The value of a company increases sharply with a strong, permanent, credible team who can demonstrate their ability to produce consistent sales, profit and cash-flow results. Establish continuity in the organisation to allow everyone to expect orderly change and opportunity. Capitalise on available underutilised human capital — those remaining middle managers. Chances are they are dedicated to the company and its success. Guide them to their next level, and they will take the company to the next big step. Acquire New Business/Sales There are only two ways to increase sales: 1) sell new products to existing customers, and 2) sell existing products to new customers. Most underperformers have forgotten, or never had, the basics of marketing and promotion. Clearly promote what your products and services can do for your customer to satisfy their needs; differentiate why your product stands apart from the competition. Become market driven, adapt to changing conditions and improve Remember, not all companies are salvageable. ❝ ❝ Finance Monthly. Bank i ng & F i nanc i a l Se r v i ce s 43

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