Business turnaround and restructuring

Many companies experience periods of under-performance, which can be caused by internal factors (internal conflicts, management or governance issues, etc.) or external factors (increased competition, reduced demand, technological changes, new environment, need for digitalization). These companies can quickly find themselves in difficulty.

Business turnaround refers to a set of practices aimed at reversing this trend, "turning around" a challenging situation in favor of the company, with a focus on revitalizing the business and safeguarding employment. This approach sometimes involves going through a wave of layoffs due to economic reasons.

A company turnaround may also require reorganization, the search for new financial resources, etc...

To best manage this turnaround/restructuring situation, Delville Management identifies the best interim managers to handle these turnaround and restructuring situations.

Interim managers specialized in turnaround and restructuring are capable of restoring a struggling company.

In the case of a turnaround, they must improve the company’s performance and restructure the organization. These managers are stress-resistant. They hold a leadership position within the company and have the ability to manage teams. It is also easier to choose an interim manager who is familiar with the industry sector to respond more quickly to this turnaround situation. Finally, it is preferable that the identified manager has previous experience in turnaround situations.

In the case of a recovery (such as a demerger, a merger, the creation or closure of sites or subsidiaries, a business divestment, or offshoring), interim managers must have a comprehensive understanding of the company and its organization. They must be capable, for example, of closing a production site, implementing a social plan (PSE) if necessary, and reassuring clients and the entire ecosystem.

The most common roles in this context of turnaround and recovery are CRO (Chief Restructuring Officer), Site Director, Chief Financial Officer, and Chief Operations Officer.

The right time to reach out to Delville Management and initiate a company turnaround depends on various factors. The key point to remember is to contact our executive interim management company as early as possible, ideally before the situation becomes irreversible

Here are a few warning signs:

• A significant drop in cash flow and financial resources;
• Declining performance, recurring losses and shrinking margins;
• Tensions within the management, internal conflicts, or a lack of leadership;
• A competitive environment evolving at a pace the company is unable to keep up with;
• Financial indicators plummeting, such as debt ratio or return on investment.

When these signs appear, it is imperative toact quickly to initiate a company turnaround. Using a turnaround consultancy like Delville Management can provide an essential outside perspective to identify the levers of action and implement the necessary changes.