How to Organize the Turnaround Project & Turnaround Team
12 Steps: Executive Overview
Step 1: Why Businesses Fail
Step 2: How to Know if Your Business is in Trouble
Step 3: Are You Prepared for the Task
Step 4: Turnaround Leadership
Step 5: Organizing Your Turnaround Team
Step 6: Stop the Bleeding (Cash)
Step 7: Problem  Diagnostics
Step 8: Marketing During the Turnaround
Step 9: Developing the Turnaround Plan
Step 10: Down-Sizing Staff
Step 11: Dealing with Creditors
Step 12: Financing During the Turnaround
Disclaimer-Please Read


Critical Care for Companies®

Turnaround Step 5 : Project Management & Your Turnaround Team

Why you should read this section

  • Project Management has been called the "premier skill" necessary for success in the 21st century. This section introduces this critical skill in the turnaround process

  • Quickly and effectively executing the turnaround strategy you will soon be developing is essential to having a successful turnaround. This section outlines the key tools, processes, and team members necessary to "get things done ASAP"

 "A vision without a task is but a dream; a task without a vision is drudgery; a vision and a task is the hope of the world" 

---From a Church in Sussex, England, C. 1730 AD---


Project Management, the Premier Skill 

In 1992, the visionary business guru Tom Peters wrote in Liberation Management that Project Management was the "coming" premier skill necessary for business success in the future. 

Project Management is the business discipline that deals with getting things done…within specification, budget, and timeframe. People often think of Project Management as necessary only for large construction projects or major information technology installations. However, this discipline is critical to save your business. 

You could literally spend the rest of your life studying this knowledge area and never read all the books and publications in the field, as it is so vast. One of the books in my library on this topic is close to 1200 pages long! Therefore, in this section of the Critical Care for Companies® Turnaround Program I will focus on the absolutely few essentials necessary for a solidly managed project. 

10 years ago, I decided to devote time to an in-depth study of the best practices in the field of Project Management. Rather then first studying successful projects, I focused on projects that were considered failures. Why did these projects fail? What were the common chrematistics of failure projects, etc. Out of that study, I determined that projects usually fail for one or more of 10 consistent reasons. I then developed a Project Management methodology based on addressing each of those 10 reasons for failure. This model has been field tested in a number of Fortune 500 organizations with very complex operating environments…and it works. 

My purpose here is not to present the entire model as that would require a separate website and is not necessary for your success. I will however give you the bare essentials to successfully organize and manage your turnaround project. 

The Turnaround Team 

Point Person 

I will make the assumption that you (the owner, partner, or senior executive of the business) have made the decision to turn the business around on a "do-it-yourself" basis. And that is really the focus and purpose of this site…to assist you in doing that. 

There must be a point person to spearhead the turnaround. That person must have the leadership skills presented in Step 1 of this program. Perhaps most importantly, this person must be able to handle crises and work well under pressure and to demand absolute accountability from other team members in terms of deliverables. This person must be carefully selected for obvious reasons.  

Other Internal Team Members Necessary for a Successful Turnaround 

The point person will need a small team to assist in the execution of the turnaround strategy that will be developed via the diagnostics stage. This group will usually come from the senior leadership team of the business (employees). In addition to the team members' domain expertise (marketing, operations, engineering, etc.), other necessary qualities are creative problem solving, an ability to get things done fast and of course loyalty and committed to the cause. Both the overall chemistry of the group and group dynamics are also important, as you will be spending many hours together and want to minimize conflict. 

External team members  

Financial Expert 

In my turnaround experiences, I have found that many times an external financial consultant must be retained for the project. Typically, the financial types employed by the business are very good at preparing financial statements and tax documents but simply have not been trained in the area of financial analysis. Many in this field are past view oriented rather then future oriented. It is like trying to navigate your vehicle by looking in the rear view mirror! If your current accountant or chief financial person is not skilled in financial analysis or management accounting, then you will need assistance in this area.  

Workout Lawyer 

I strongly recommend that you retain the services of a good attorney with experience in workouts and bankruptcies. Think of this person as an insurance policy during your turnaround. You will be walking through a "mine field" of issues and making the wrong decisions can literally land you in jail. I know a good lawyer is expensive but they will be worth the investment. 

Dr. Arnold S. Goldstein, author of "The Business Doctor" has some pointed comments about lawyers and accounts during the turnaround 

  • You will invariably need an attorney, even if it's to forestall and defend creditor suits and to threaten your creditors with bankruptcy if a more pleasant and cooperative workout is unsuccessful

  • Few attorneys are skilled in rehabilitating troubled companies. Real estate, criminal and probate lawyers, who wouldn't know a balance sheet from a cash-flow statement, too frequently get involved in complex business and insolvency cases

  • Hire an attorney well experienced in saving troubled companies. You need a legal gunslinger who knows every trick and strategy to defend you and your beleaguered company from your numerous foes.

  • I fire accountants who do not help our mutual clients to financially manage their business. We regain credibility and creditor confidence only when new accountants take the financial controls. Replacing accountants is absolutely essential when your accountants helped conceal your poor corporate condition through manipulative accounting

  •  Fire your accountants if they were too slow to alert you to your declining financial condition.

  •  Accountants who only prepare neat balance sheets, but won't tell you how untidy those numbers really are, do not belong on your turnaround team. You must have somebody who thrives in the world of cash flows, cost analysis, break-even projections, forecasting and budgeting.

Other outside experts 

In addition, you may need to retain, on a short-term basis, other business specialists such as Asset Liquidators, Sales & Marketing experts, Manufacturing consultants, etc. Additional needs will become clear as your team goes through the diagnosis stage of the turnaround and creates the strategies. As you develop the turnaround plan, gaps in expertise needed to execute the plan will become clear. 

The Project Management Tool Kit 

I have found that the 4 most critical tools necessary for a successful project are: 

  • The Project Plan

  • Issue Resolution System

  • Risk Management System

  • Project Notebook

The Project Plan 

First, let's be clear on terminology as we discuss the project plan. 

Strategy, Goals & Objectives, Tasks 

There is a great amount of confusion around these terms. Just to be clear, this is my definition for each. 

Goals & Objectives are synonymous…they mean the same thing. They are the target. What you are attempting to accomplish. An example would be: Achieve a positive weekly cash flow of at least $1,000 by June 30, 200_. 

Strategy is a general method for achieving specific objectives. It may describe the essential resources and their amounts, which are to be committed to achieving those objectives. An example of a strategy is: Get to a positive cash flow (the Goal) by flattening the organizational structure and laying off 15 employees. 

Tasks are the individual steps required to carry out the strategy so that the goals are attained. One step, as an example, that would be part of the above strategy is to develop a Reduction in Force (RIF) analysis. 

Each task has the following criteria: 

  • Clearly defined work that must take place

  • At least one person assigned to the task to ensure completion

  • Date the task will be completed by

There are literally dozens of other information pieces you can track related to tasks. Open up any of the more popular Project Management software program such as MS Project and you will be overwhelmed with the tools and details available. 

This is over kill for our purposes of turning around your business!! Use the following format, put into MS Word or MS Excel (you can track tasks on a legal pad if you are computer challenged). 

  • List the goal statement

  • List Strategy

  • List each task along with the resource and timelines (starting and ending dates)

That is all you need for a well constructed project plan. 

Issue Resolution System 

An issue is simply an event that has emerged which may prevent you from completing a task, strategy, or goal. For example, let's say that you have completed the RIF analysis and discovered that by implementing the plan you will not accomplish your goal of a $1,000 positive weekly cash flow but will still be in the red. That is an issue. Therefore, to resolve the issue, you must go back to the planning stage and develop additional strategies. These issues must be tracked as they emerge. Again, track in MS Word or MS Excel. 

The format is: 

  • Issue Number

  • Description

  • Owner

  • Priority

  • Date Entered

  • Date Issue Must Be Resolved By

  • Date Actually Resolved

  • Resolution description

Risk Management System 

This is like a radar system which is always scanning the horizon looking for possible risks. As an example, let's say you have identified one particular employee to lay-off but you have also discovered that this person has a history of taking legal action against previous employers. Before you proceed with the lay-off, you should assess the risk and determine if you will need to develop a risk mitigation plan to eliminate or minimize that risk. The format for the Risk Management System is: 

  • Risk Number

  • Severity (Red-Yellow-Green system works well where Red indicates the probability of mitigation is low and it is a "show stopper", Yellow is critical but mitigation appears feasible, Green is a risk that bears watching but appears to have been turned around)

  • Risk Description

  • Risk Mitigation Plan

  • Person Responsible

  • Status (as of the reporting period)

  • Date added

  • Date Needed (to be resolved by)

  • Date Resolved

Finally, I would strongly urge that you set up a Project Notebook to keep all of the necessary project documents, plans, budgets, etc. organized. I use a large 3 ring binder with 30 dividers or tabs. Under one tab will go the project plan, another tab the Issue Resolution System, etc. The 30 tabs will give you adequate organization for all of the project artifacts. I am continually amazed how this simple system aids in staying organized and on top of the project. 

And there you have it. All you really need to know about Turnaround Project Management and your Turnaround Team.







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