Strategies for a successful turnaround

There are numerous reasons why companies can find themselves in a difficult situation and seek a turnaround. Accordingly, a large number of possible challenges must be recognised and overcome in order to get on a profitable, sustainably stable path. Companies are faced with a number of questions:

How can the company be stabilised and its financial position assessed?

Companies that find themselves in a difficult situation must first and foremost improve their performance or restore their efficiency in order to overcome financial difficulties and remain profitable in the long term.

How can the risks and opportunities of all stakeholders be optimally weighed up and communicated?

Maintaining or regaining the trust of the relevant stakeholders - from customers and suppliers to investors and employees - is crucial to ensure their support and co-operation during the turnaround.

Which strategy creates sustainable corporate value and reduces resistance?

Resistance to change is typical. This is why it must be recognised at an early stage, communicated and taken seriously from the outset in order to be able to counteract it effectively.

How can companies utilise their strategic options quickly and their resources effectively?

Companies that find themselves in difficult situations often have to fight on several fronts at the same time: limited resources in various areas such as management capacities, technologies/technology and in financial terms restrict their room for manoeuvre. In addition, improvements are required in the short term in order to stabilise the situation quickly.

Change and transformation processes are complex and involve uncertainty. There are no guarantees for success and standard solutions are always inappropriate. Such situations therefore require careful analysis and planning.

Our approach to overcoming the challenges in the turnaround process comprises the following four steps:

1. Identify and analyse causes
   We start by thoroughly analysing the situation in order to identify the causes of the company's difficult situation. This includes analysing critical issues such as strategy, business model, competitiveness, operational processes and market changes as well as performance or financial bottlenecks.  
     
2. Develop a turnaround plan
   Based on the findings of this analysis, we draw up a suitable turnaround plan with clear and realistic objectives.We integrate the measures into the existing corporate planning and harmonise them with the business strategy.  
     
3. Derive suitable measures
   The next step is to develop suitable packages and programmes of measures aimed at achieving the goals set out in the turnaround plan.Here we focus on various areas:
   
   a. Operational measures: Improvement of customer/supplier relationships, optimisation of procurement, supply chains, production and logistics.
   
   b. Administrative measures: Reduction of overhead costs or consolidation of organisational/business units to increase efficiency.
   
   c. Financial measures: Optimisation of working capital and other financial aspects to improve liquidity.
   
   d. Strategic measures: Critical review of the business model and examination of strategic options, taking into account the interests of involved stakeholders.
   
   e. Controlling and reporting: Ensuring effective reporting and regulatory scrutinising plans and ideas.
   
   
4. Supporting the implementation and monitoring of measures

Rapid and targeted implementation of the necessary changes is crucial. We implement effective monitoring mechanisms to observe the progress of the measures and ensure that they achieve the desired effect.

Our aim is to guide companies through the turnaround process and position them for a successful future. The following aspects in particular play a decisive role here:

• Time: Early action enables effective planning and implementation of the necessary measures to stabilise the situation and achieve sustainable improvements.
• Management commitment and cooperation with all relevant stakeholders: It is important that management works closely with all relevant stakeholders and takes their concerns and issues seriously.
• Develop and implement a clear turnaround plan: A structured turnaround plan should include clear objectives, strategic priorities and specific actions to achieve the objectives.