How to Get a Company Out of Crisis?
68 POSITIV
LÍDR
Once you enter a company, where
do you start? How do you get to the core
of the problem?
During the initial meetings – often even
before a specific assignment is agreed –
I will sit down with the company owner
over lunch or dinner. We talk, I listen,
and I ask how they perceive the current
situation and where they believe
the problems might originate.
At the same time, I analyse publicly available
data – financial statements, profit and loss
reports, audited accounts. I do this even
before we have finalised any cooperation.
These figures can reveal a great deal –
growing inventory, excessive personnel
costs, declining revenues. That alone
often indicates that something is going on.
And if the owner and I reach agreement
on the direction and goals of the work,
we then define specific milestones for
the implementation steps.
What follows is an in-depth analysis
of the company, carried out alongside
executive activities directly on site with
senior managers – typically the CEO,
head of sales, procurement, logistics,
and production depending on the type
of company. This way, I gather information
first-hand while also working with up-to-
date P&L data.
Does that mean you work on everything
by yourself?
Most of the time, I start on my own.
The client expects someone with a broad
perspective comes to the company
– someone who understands finance
and has experience in sales, production,
and procurement. Personally, I pay close
attention to stock levels. Their structure
often tells you more than a hundred
presentations about the efficiency
of purchasing, stalled orders, and the
health of cashflow.
However, if I find that the company needs
deeper technical expertise – for example,
a technology specialist or a process
engineer for the launch of a new production
line – I bring colleagues into the team.
I have a wide network of trusted experts
around me, which allows us to deliver
stronger results and more comprehensive
solutions for the company.
Can you say where the root cause
of problems in a company usually lies?
When an owner tells me that there
is only one problem in the company
and everything else is working fine,
I already know that’s not true. It’s always
a combination of factors. But if I had
to point to the root cause, it almost always
comes down to insufficient sales, which
then triggers a chain of further issues.
How does the cooperation between you
and the company’s employees work?
There are people who welcome change.
For example, they may have long felt that
something isn’t working. Others, however,
see it as a threat. With them, it’s crucial
how quickly their true attitudes become
clear. From day one, I set firm rules. For
example, I cancel the home office so that
I have all employees on site and I can
work with them directly. Within a short
time, the team splits into two groups: one
ready to move forward, and the other
ones resisting change. If it turns out that
the opposition is permanent and becomes
an obstacle, there is no choice but to make
personnel decisions.
So can it even lead to replacing people?
Yes, but it’s important to stress that a crisis
manager is by no means a synonym for
a “hatchet man.” That’s a myth. Especially
today, when skilled people are scarce.
Reductions are carried out in a controlled
and thoughtful way. At the same time, it’s
my responsibility to provide an adequate
replacement.
How do you know you’re heading
in the right direction? How soon
do the results appear?
A company’s transformation phase
is a long-distance run – true stabilisation
can take up to two years. And the rule
is simple: the longer a problem has been
smouldering in the company, the longer
it takes to fix it. Expecting a miracle in two
weeks doesn’t work.
The most intense period is usually the first
three months, when all the changes are
introduced. The next three months are
about stabilisation – the new processes
settle in and are fine-tuned. At the same
time, previously hidden problems tend
to emerge, so we‘re talking about roughly
nine months of intensive corrective action.
You have many years of experience
in the field. Do you have
any know-how that helps?
If I find that the situation in a company
is serious – or, on the contrary, that
the company has unique potential – I start
considering whether the best solution
might be to find an investor. That certainly
does not mean I am “secretly” offering
the company – absolutely not. But I view
the business in the wider context of the
market, competition, and sector dynamics.
And if I begin to feel it could be attractive
to someone, I raise this idea very carefully
with the owner.
The right new owner can move the company
forward. Often it ends with the original
owner being grateful for the opportunity.
But there are also cases where bringing
in an investor is not a choice but a necessity
– for instance, when the company is on
the verge of financial instability and further
development becomes impossible without
external capital.
Together with the owner, I then walk
the entire journey from the initial
assignment through to the actual handover
of the company, whether by sale or merger.
And this step – often not even considered
at the beginning – frequently turns out
to be the most sensible solution.
Thank you for the interview.
An interim manager temporarily
lls a key role, whereas a crisis
manager deals with a deeper,
more long-term problem.