Earlier this month the Institute for Turnaround (IFT) published its societal impact report: Unlocking Value, Saving Jobs: The Contribution of Turnaround to Business and People, highlighting the important role the turnaround industry plays in protecting people’s jobs and the wider economy.
With the Covid-19 virus taking its toll on the health of the nation there are exceptionally challenging times ahead. This situation is also likely to claim the health of a significant number of businesses in 2020 despite the numerous government initiatives to protect jobs and companies. The skills of turnaround professionals in providing immediate viability and confidence to businesses will be of critical importance to avoid unnecessary insolvencies.
Some of the 300+ companies that fail every week in the UK may have been able to turnaround had they swiftly called upon the skills of highly experienced turnaround professionals who can breathe life back into the businesses, rehabilitating them to prosper again.
Usually in addition to finances, time is the biggest constraint in any turnaround situation. There is a narrow window of opportunity to assess the problem and implement the necessary changes. Another critical factor is having the right team to implement a turnaround. A broad skill set and effective leadership to inspire the people within the business to pull together with belief and conviction in order to turn the business around is critical to success.
Recently Kingsgate supported a long-standing manufacturing company in a region with the highest unemployment rate in England. This firm was key to the supply chain for a range of industries and had plans to launch two new product families. However, annual sales were decreasing, market share was insufficient, and the factory was working below capacity, thus overhead costs and product development were unsustainable. It was apparent that the solution was broader than simply cost reduction measures and required new ways to unlock efficiency improvements. This was particularly important as this employer was key to the wider community and a supplier to a number of industries.
Vital to the implementation of the programme was securing the commitment of the shop floor personnel through to senior management in addressing the challenges.
In order to achieve the goal, the strategy developed needed to be visibly reinforced on a daily basis in every aspect of the business. This involved motivating teams and establishing effective communication channels by working actively with senior management and change agents, aligned performance objectives, and most importantly ensuring the ‘day-in-and-day-out’ behaviours of the entire management team all consistently brought the goal to life. In upskilling the entire workforce to understand the market dynamics and key performance targets, this enabled enhanced productivity and efficiencies. Crucially, by resisting the temptation to let up once the early signs of success showed, what initially felt like a slow process actually yielded faster than expected results.
Together, the team successfully launched new product family lines, returned the business to profitability, created a sustainable operating model and importantly reduced overheads which were reinvested in people development and ultimately saved skilled jobs. Significantly, the confidence to continue executing the strategy was embedded within the management team, ensuring that the path of growth and recovery was sustained.
Get in touch to find out more:
Kelly Jones, Turnaround & Transformation Director firstname.lastname@example.org