When is a management turnaround complete?

When the company is successfully repositioned and reorganized, its viability is restored on a continuous basis. At that point the management turnaround is complete.

In a non-seasonal business, the requirement of viability on a sustained basis requires at least two sequential quarters of positive financial results from ongoing operations plus a reasonable balance sheet and a rock-hard management.

The new management has to be solid enough that the errors and omissions that led the company into trouble are unlikely to be repeated while this group is in charge. Not all corporate turnaround specialists include the formation of management that succeeds them as part of their package of turnaround services. We do, because we feel that even if financial results are positive, a sustained basis is not necessarily achieved until the successor management team had successfully taken over responsibilities from the turnaround team.

For this reason our services include the formation of the successor management team. Furthermore, we work with the new management for several months after the company has returned to workable operation in order to make sure the new team is on the right path.

This new team may include the most qualified amongst your present staff, but after the corporate turnaround they will operate in a very different way from how things were done when the company got into trouble. The new team will continue the processes of questioning, evaluating, and energetic attitude of the management team.