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:
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:
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.,
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,
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.
A friend sent me an interesting—if depressing—presentation about the economy (past, present, and future) that was made by Alchemy Partners to a turnaround group in England. To view the presentation, please click here.
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
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.
