Back in 2010, we caught up with Bob Ellis, an incredibly experienced and talented restructuring specialist, who at the time sat on the boards of 8 different businesses, and he offered us his insight of working with organisations in distress. Five years later, market conditions have changed but the valuable points made back then are still relevant and can be applied in businesses that are currently facing challenges.
As Bob had stressed, there are four consistent issues facing distressed businesses:
1. the economy
2. markets changing in dramatic fashion
3. operational initiatives failing
4. poor management
In most restructurings, elements of all four are visible.
The role of Chief Restructuring Officer carries great responsibility and requires individuals with the ability to work under stringent pressure.
Below we have extracted some timeless tips for restructuring officers, from the interview with Bob Ellis.
- Remain calm and offer reassurance to the people you work with
- Be decisive; take decisions even if it’s a bad decision, it’s better than making no decision at all. Momentum is critical to keep the process moving
- Have a clear plan before you go into an organisation of where all the key stakeholders are and what their objectives are
- Make sure you have a competent management team at the top
- Surround the CEO and CFO with good processes and a strong strategic direction
- Concentrate on the core strengths of the business and focus on improving that piece
One of the options that Ellis considers in order to support the management team is hiring interim specialists that offer a rapid injection of expertise, energy and experience into the business.
‘The big advantage of interims is they are accustomed to being, and expect to be, thrown in at the deep end. They provide fresh impetus and force everyone else to examine their own contribution. Skilled at stepping into complex environments, working with an interim often raises everyone’s game’. Bob Ellis
News & Insight