Meaning
Consulting practice focuses on restoring the health of a business through restructuring and cost reduction. Turnaround advisory identifies the readiness questions that were missed during a failed transition to production. It provides the expertise needed to stabilize a company that is facing a liquidity crisis or a severe drop in performance.
Operational Stabilization
Immediate actions are taken to stop the loss of cash and improve the efficiency of the factory floor. Turnaround advisory often involves reviewing the production yield and identifying the root causes of waste or delays. By optimizing the existing processes, the consultant can quickly increase the company’s output.
Financial Restructuring
Negotiating with banks and vendors allows the company to adjust its debt payments to match its current cash flow. Turnaround advisory provides the data and the strategy needed to convince creditors that a recovery is possible. This process might involve selling off non-core assets or seeking new investment to fund a second attempt at a production launch.
Creditors want a plan.
Strategic Reorientation
Long-term success requires a shift in focus toward the most profitable products and markets. Turnaround advisory helps the leadership team develop a new business plan that avoids the mistakes of the past. This often involves moving away from high-risk prototype development and toward proven high-volume manufacturing.
