Success story - Turnaround Management

Problem

The client company was hemorrhaging cash. After early growth and profitability, it had lost its way. External investors were becoming increasingly concerned for the future.

Solution

After an initial review it was clear that basic controls were either absent or weak and management information was poor and out of date. We upgraded the controls and implemented those, in particular in the area of debt collection and acceptance of contracts. At the start of the assignment, there were four months debts outstanding. Within three months we reduced that to six weeks. We also prepared an analysis of profitability by business type. It became clear that some of the businesses were not profitable and the management team decided to exit three business sectors.

Results

Cash flow was turned around. Profitability was improved by 11% and the company slimmed down to a more focused and viable business.

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