Business Turnarounds, Restructuring And Strategies For Survival And Success
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Business Turnarounds, Restructuring And Strategies For Survival And Success
These articles, some of which I am choosing to curate, deal with topics relating to the saving of a troubled business by utilizing restructuring techniques and other key turnaround protocols, tactics and strategies.
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Main Syracuse ambulance company files for bankruptcy; change won't likely ... - SU The Daily Orange (subscription)

Main Syracuse ambulance company files for bankruptcy; change won't likely ... - SU The Daily Orange (subscription) | Business Turnarounds, Restructuring And Strategies For Survival And Success | Scoop.it
Economic Times
Main Syracuse ambulance company files for bankruptcy; change won't likely ...
Douglas E. Castle's insight:

After reading the article, it struck me as fascinating how the Economic Times was callng this Chapter 13 abankruptcy (as if it were a death knell for the ambulance company), and that the ambulance company spokesman, out of political training, or out of ignorance, called the proceeding "a routine reorganization....the company's service will not be affected." The reason for the publication taking a more fatalistic view is that most companies of small to medium size ultimately wind up transitioning [atrophying] into Chapter 7 (a liquidation of asets, usually by auction), with a complete cessation of activities, The "reorganization" is basically a court intervention which just forestall (in most cases) a liquidation.

 

This fatalistic perception has permeated all of society because of the sad fact that those companies which are not "too big to fail" do not do anything constructive during the Chapter 13 reorganization period in terms of formulating and implementing an Emergence Plan to leave Chapter 13 and emerge as a streamlined, smarter, better-run enterprise. It takes an expert with a great deal of knowlege to get into the company, correct its trajectory objectively and candidly, in order to navigate through the "reorganization" into a newer, better way of doing business.

 

Lamentably, most businesses tend to just use Chapter 13 as an excuse to continue making the mistakes that brought them to the courthouse in the first place. That's very foolish. They need to be turned around by a visionary from the outside with an objective view and a firm hand regarding suggestions and implementation.

 

Douglas E. Castle http://DouglasECastleBlog.com

@DECastleAdvisor.

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Editorial: What Detroit’s crisis can teach others Avoiding bankruptcy requires confronting crises early, focusing on taxpayers and making realistic promises

Editorial: What Detroit’s crisis can teach others  Avoiding bankruptcy requires confronting crises early, focusing on taxpayers and making realistic promises | Business Turnarounds, Restructuring And Strategies For Survival And Success | Scoop.it
Detroit News Detroit’s fall into bankruptcy is being pitched as a cautionary tale for governments at every level. And while there are extraordinary circumstances unique to the Motor City, there are...
Douglas E. Castle's insight:

I am in full accord with the writer's point of view as it concerns Detroit, specifically, and as it concerns all businesses and organizations which have fiduciary responsibilities. Sadly. election politics as well as organizational office politics tend to bring out some unsupported or unsupportable promises which ultimately will become perceived as lies. In any business or organizational structure (For-Profit and Not-For-Profit) you cannot make empty promises, as they will cost you all of your negotiating power (based largely in credibility), and possibly your career when the truth comes out.

Let's assume that we are following a sensible business protocol, and that we are responsible to the Board, our colleagues, our employees, our customers (or constituents), our creditors and our investors. A methodical approach must be undertaken -- it is sad that these politically-oriented individuals don't examine the financial position and projections of the governments or businessess which they are trying to get the opportunity to lead prior to embarking on their campaigns.

A general rule to start with is that you cannot ever make a promise which is unconditional, especially if it is dependent upon the promises of others (grants, investments, lots of new business revenues, a technological breakthrough and the like). Make fewer promises of good and plenty, and more commitments to fixing problems at their source to ensure safety, stability and success. Not to ridicule anyone at the federal government level, but you can't make inferences to "getting out of debt by increasing borrowing,' or balancing the budget and helping businesses by increasing taxes on the poorer and middle classes and reducing services to them as well!

Never make a commitment that you do not intend to keep, and that you do not have a plan (a method) to keep. Exaggerate costs and completion or delivery timeframes - it makes it easier to be a hero.

In terms of troubleshooting your enterprise, the protocols are universal:

1) If a responsible individual sees or suspects a problem, it must be reported immediately to the appropriate authorities;

2) That individual should follow through with vigilance and persistence to see to it that the problem is solved before it wastes any more money and before it worsens;

3) The problem must be expediently fixed - after all, every minute of loss is a drain on profitability and solvency;

4) If there are too many systemic problems, and your current financials as well as your proforms (always have worst-case, realistic-case forecasts handy; they should be created frequently as assumptions and conditions change; they are a powerful management tool, and an early warning system) are not looking good, you must gather the right experts, both from inside the organization and from your "A" list of outside professionals, and;

5) Re-examine your entire business model in terms of S.W.O.T. analysis, critical path dependencies analysis, and possible displacement (or antiquated assumptions) analysis. Look to prune your sunk costs and nonproductive recurring costs;

6) Reconstruct your business model with the help of your expert committee, create a realistic, turnaround reconstruction plan, promulgate it to all of the involved and affected individuals, as well as to all other parties doing business or trade with your firm. Let them know of the changes, what the timeframes really are, what sacrifices or compromises they will have to make lest the team effort fail (Note: If you're a charismatic, credible, strongly committed leader, you will convince every individual, from the board room down to the janitorial staff that they are each, and all, partners in the the success of the business,and that necessary sacrifices may have to made to bring stability and better results. Take a serious tone, especially when asking for sacrifices and compromises. Make everyone feel like a stakeholder and an employee or an agent of help;

7) Work the new plan to the letter, diligently, faithfully and without deviation. Report to all of your "partners" frequently as results come in and new forecasts are made. Your diligence, conscientiousness and candor in terms of reporting frequency and transparency will be appreciated and might make potentially hostile parties feel more like allies in a group project and a united effort. That latter is the effect for which you should strive - it justifies the sacrifices and compromises...and to make it even more potent, be certain that the C-Suite occupants, senior executives and the directors make visible meaningful sacrifices as well. You don't want to look like a "too-big-to-fail" company that the U.S. government just bailed out [grin];

8) Demonstrate by variance analysis (projected versus actual results) how you are actually achieving the goals set forth in your turnaround business plan, and how you have converted waste and losses to a positive, potentially distributable fund balance;

9) From that positive pool of hard-won cash, reward all of the parties who have cooperated in the effort (at a sensible level,and not just to the seniormost executives and directors, but to all of the participants, sacrificers and compromisers who have made it possible. Everyone enjoys a participatory celebration of success and a feeling of having participated in a victory...everyone!

Demonstrate in distrbutable dollars and cents that the tough cuts have paid off in terms of solvency, stability and a positive cash flow. A great leader (as opposed to a basically attired career politician) rallies his forces for a job successfully done, reminds them that their efforts need to continue, and also reviews the victorious results of the variance analysis -- show them how inflows have increased and how outflows have decreased. Make them all feel like stakeholders.

10) Promise to continue on course, and to remain vigilant and practical, as well as honest and tough. Continue to restructure and turnaround the business periodically with a "no sacred cows" and a zero-based budgeting appoach. These techniques and tools work.

 

Douglas E. Castle http://DouglasECastleBlog.com

Contact The Curator https://getglobaledge.wufoo.com/forms/k7s0a7/

View DOUGLAS E. CASTLE's profile on LinkedIn at http://www.LinkedIn.com/in/douglascastle  ;

Follow @DECastleAdvisor on Twitter http://twitter.com/DECastleAdvisor

 

 

 

 

 

 

 

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Business is war: Jack Tramiel's secret to conquering Silicon Valley - StartupSmart

Business is war: Jack Tramiel's secret to conquering Silicon Valley - StartupSmart | Business Turnarounds, Restructuring And Strategies For Survival And Success | Scoop.it
Business is war: Jack Tramiel's secret to conquering Silicon Valley StartupSmart Vertical integration is where you grow your company by buying or starting a number of businesses along the same supply chain in one industry at different stages of...
Douglas E. Castle's insight:

Business might indeed be war, but in many cases bridge-building assists in the process of the ultimate conquest.

 

As a firm believer in vertical integration (a company buyer its customer or its supplier) and in thereby becoming a combined and more self-sufficient entity, both larger, and more powerful with certain expenses redundancies to be eliminated to assist in boosting combined profitability, I have found that it's much more important to befriend and negotiate [sometimes that feels like war] with a prospective acquiree company and its management, usually on several levels, in order to "educate" it regarding the advantages to its best longer-term interests, such that it comes along as a willing and smiling captive instead of utilizing any other, more hostile strategy, which would be a secondary choice.

 

The idea is to conduct the war utilizing intelligence (informational), diplomacy, education and negotiation in such a manner that your target never even knows that any war was occurring.

 

As the late lawyer (for the famous O.J. Simpson murder trial) Johnny Cochran might have said: "If you want to agressively integrate, you must educate and negotiate."

 

-Douglas E. Castle

 

 

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