"Who Else Wants To Be Spoon Fed Step-By-Step Strategies To Reduce Loan Repayments, Conserve Cash, Protect Your Assets, Regain Confidence of All Stakeholders. And Become The Hero Of Your Company!"

There I was. A CFO of a company that had made money for 50 years in a row, and now we were burning up money at a tragic rate. It was time to cut-costs, hunker down, and try to conserve cash until we found a new way to generate profits and cash. The CEO of the company disagreed and wanted to aggressively move forward with new customers and new products.

I lost out. Unfortunately I could not sell the reality of what I saw to the CEO, and down the company spiraled, deeper and deeper into trouble...

Fifty years earlier, the company founder traveled to the alternate coast to seek a better future for himself and his family. He started a little company of which he was the only employee. It grew slowly and carefully, nurtured like a little flame, and eventually grew to a nice sized small business with a hundred or so employees.

Eventually the founder got too old to carry on. He had put a good management team in place and with the help of his son, the company carried on and continued to grow and produce good products, at a good price, and combined it with excellent customer service. Things were good, and the shareholders, creditors and employees were generally very happy.

Unfortunately for the company, it was right in the gun sights of the manufacturers in China who had cheap access to raw materials and even cheaper labor. They were able to make products and land them in the USA at a cheaper price then our company could buy raw materials. At first the Chinese products were of poor quality and their deliveries were erratic, but eventually, with the help of American retailers, they developed first rate products of good quality, predictable delivery, but still at dirt cheap prices.

As the business declined there was the normal amount of denial and anger. There are politics and turf wars in all companies, but these situations come to an angry head when a company starts losing money. Everyone feels righteous about what they think the company should be doing and how the out-of-line expenses should be reduced in "someone else's" fiefdom.

If the company would have recognized its serious predicament early. Then we could have retrenched gently and produced profits based our core strengths. I wish that is what had happened, but it was not to be.

Our CEO along with some support from other executives in our company, thought it time to venture into new products and new high-volume low-profit (heavy-loss to be more accurate) customers. These were bold moves, and I have to give the CEO credit for taking bold action, but it brought the company to even larger losses and the eventual loss of our credit line at the bank.

Now the situation is much more bleak. Tremendous losses, lots of internal conflicts, a failing infrastructure of management and equipment, and loss of faith from our largest creditor - the bank.

Enter the turnaround artist. His first order of business was to find out exactly what was going on. He interviewed all the key players in the company extensively. As the CFO, it was my job to provide him numbers. He kept me very busy as he peeked into all aspects of our financial situation. Talk about rolling up your sleeves and digging into it. He was used to his own style of reports and budgets, so I had to convert our data into a format that was easy for him to understand and quickly assimilate.

As the owners of the company, which included the CEO, were in denial, they figured that the losses might be due to internal theft. This is certainly something that should always be considered. The turnaround artist and his staff audited the inflows and outflows of cash until they were satisfied that all the financial transactions were being handled honestly and above board. I think I have had less thorough inspections at my doctor's office, but my staff and I passed with flying colors, as we knew we would.

Our internal management problems were apparent to anyone that had a pulse. Even our lowly janitor, who was a long term employee of our company could detail the management problems and where the heavy expenses of money were being wasted. Eventually the turnaround artist had completed the analysis stage, had formulated a detailed plan and it was time to make some big changes.

Our CEO was so entrenched in how the company operated, and was so unwilling to part with his long time employee/friends, that he was unable to take that actions that the turnaround specialist's plan required. Our CEO was a great guy who cared about the people that worked for him, and he was not up to the task of causing pain for some of them, to save the lot of them. He was replaced by the other stockholders, in a terrible family battle, and the turnaround specialist took the reigns as the active CEO.

He made immediate cuts in salaries and expenses and put the company on a strict budget. He took all control of cash and spending decisions. Information was shared at all levels with employees, more detail for the executives, and simpler for the rank-and-file, so that everyone had a clear picture of the state the company was in and what was required to survive.

The sales manager made a sales forecast that he had to adhere to monthly. Everything and everybody were tightly controlled and results were compared to the forecasted revenues and expenses. Differences between forecasted numbers and actual results were immediately reconciled and we did everything in our power to adhere to turnaround manager's plan. If we were able to produce the numbers in the plan, we knew we would produce solid cash flows that would allow us to survive.

Of course, after all of our losses, this painful stage was absolutely necessary. Did it hurt like hell? You bet it did. Many people took 30%-40% cuts in their compensation. A lot of folks had a hard time living on the money they had made previously, so these cuts caused them to have to make major decisions in their lives so they could live more frugally. As executives, we were used to a much longer leashes and now our actions were much more tightly controlled.

As time went on, the new turnaround manager's hands-on style and good communication skills allowed everyone in the company to work together better than they had in the most recent problematic years. Sure, he was not the most popular guy in the world. He took away the money and took away the toys, but he was also the companies' only salvation for the future. Everyone knew we needed much stricter spending controls and a better working environment where we were all working for a common goal.

We were all in the same boat, although now it was a smaller vessel. As time went on, there was attrition of personnel, as well as additional layoffs and cuts. Basically, if we could get along without it, which means: if the customers' would not immediately notice it, if it raised cash-flow instead of cut-it, it was a clear and easy decision for the turnaround manager to get rid of it. And so, he made the important decisions, and acted upon them as soon as possible.

I learned a lot during my years at the company. I was there in the good years, as well as the bad and the ugly. I was there during the initial seeds of rejuvenation and got a chance to feel what it is like to be "subjected" to a turnaround, which allows me to be much more sensitive to the important human issues that occur during this difficult period.

One of the main things I learned during this experience, was that the earlier problems were solved, the better. Shake your feelings of disbelief. Business failure can happen to you. It takes quick, direct and decisive action to turn a company around. The longer you wait, the less chance it has of being successful, and the more difficult the cuts and cures need to be. Take charge of your company, take charge of your life. Turnaround your company, turnaround your life.