“Turnarounds seldom turn” (Warren Buffett)
In the life cycle of any business, it will almost inevitably experience a crisis. This is always a very difficult time and it will be a test of judgment and experience how senior management respond. Usually, it will be some issue that is solvable and the business will continue to operate.
Sometimes however it is an existential threat and this will need careful thought and planning.
Stress drains your energy
Deciding whether to try and turn around a business or put it into liquidation is enormously stressful. Many careers and the family of staff and key stakeholders could suffer depending on the outcome.
It is unlikely there will be a second chance if the first decision made by management turns out to be incorrect.
What is the problem?
So the first thing to do is identify the core problem. There are many things to look at:
- Is your business in a mature to old stage?
- Are there disruptors like Uber in the industry?
- Is there still demand for the product or service your business provides?
- What sort of shape is your business in? Are systems and infrastructure creaking or worse?
Money, planning and analysis
Once you’ve identified the problem and developed a solution, it’s essential to ensure you have the necessary resources for a successful business turnaround. Careful cash flow planning is key to sustaining progress and achieving long-term stability. While turnarounds require strategic execution, a well-structured plan and thorough analysis significantly increase the likelihood of success, helping businesses regain momentum and thrive.
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Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice.
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