The Hindu Business Line : Turnaround traits

AMONG the most sought after heroes of the corporate world are those — the likes of Lee Iacocca and Jack Welch abroad and V. Krishnamurthy and M. Damodaran in India — who willingly take on themselves what others would spurn as a "scavenging job" of pulling up an enterprise at the rock bottom of its fortunes and making a resounding success of its rehabilitation and resurgence, even bettering its previous performance record. These turnaround magicians are predictably a very rare species and are not to be had for the asking. I deliberately use the word "magicians" because what is at play in their case is not mere professional competence and managerial credentials, but the ability to combine these with some kind of extra-sensory perception and intuitive and even instinctive flair to do the right thing at the right time in the right sequence and the right manner.

Efforts made for achieving a turnaround do not consist of just the obvious management sutras such as: Cut costs, manage expenditure, stretch creditors, reorganise balance sheet, generate cash, sell assets, collect receivables, bring in new money, attract new investors, generate new sources of revenue, manage working capital, ensure cash flow for extended periods, and the like. If this is all there is for a turnaround, any person with average executive abilities can bring it about. This is not to decry these time-honoured recipes for rescuing a company down in the dumps: They are important but not sufficient.

A turnaround involves either radical alteration in existing product lines, systems, procedures and processes or their replacement. More than all, the organisation's goals and work culture may be crying for change, to be followed by removal of deadwood among personnel, retooling those who are retained and hiring fresh blood in tune with the new thrusts and tasks. Anything that touches human beings and their habits formed over the years poses the most formidable challenge along three directions. Lifting the spirits and morale, putting in tremendous efforts to overcome resistance and hostility from within to whatever turnaround entails; and enlisting the support of the stakeholders and winning their trust and confidence. That is why a turnaround maestro is so hard to come by.

B. S. Raghavan

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