MF Methodologies


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Turnaround and succession planning methodologies, including business recovery pre-insolvency. This guide is part of the MF Turnaround Manual. The manual is designed for accounts and professionals wishing to develop operational turnaround skills.

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MF Methodologies

  1. 1. Summary of Methodologies for Corporate Turnaround
  2. 2. <ul><li>  </li></ul><ul><li>This presentation summarises the methodolgies used by Moore Fleming. </li></ul><ul><li>  </li></ul><ul><ul><ul><ul><ul><li>The Diagnostic </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>5 Point Plan </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Change4 </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Energise Your Team </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>The Business Turnaround Game </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Succession Planning </li></ul></ul></ul></ul></ul><ul><li>These can be used in programmes of change or turnaround in a corporate organisation and are applicable to both private and public sectors. It also contains brief information on the other related services to Turnaround comprising Succession Planning, Access to Finance and Executive Development. Further information and training is required before these methodologies can be applied. </li></ul><ul><li>  </li></ul>Introduction
  3. 3. The Business Model It is an integrated model as each model may use common methodologies. Turnaround Succession Planning Change4 Access to Finance
  4. 4. Turnaround – The 5 Point Plan Our approach has been developed over about 20 years. It includes a Diagnostic Process and Business Recovery Model that were designed by Harry Moore and partly sponsored by the UK government. He was given several UK Government grants to both develop and deliver the model, whose output was 135 businesses saved. Diagnostic (1) Create a Window of Time (2) Plan the Turnaround (3) Implement (4) After Care (5)
  5. 5. Diagnostic – Entrepreneurial Style By segmenting we diagnose. For example, a Lifestyle business is typically family-owned or owner managed, was founded on the basis of an idea or a product and its main focus is to provide for the family and successive generations and to take as much money as possible out of the business. It will have high value but its growth will be determined by the willingness of its owners to re-invest. Accordingly, we can quickly identify issues that are generic to that style of business by placing them in the above matrix. Lifestyle Developer Employee Builder Growth Value Entrepreneurial style
  6. 6. Diagnostic – The business life cycle Growth Consolidation Crisis Management Style Entrepreneurial Structured Turnaround Life cycle stage It is important to understand where the business is in terms of its life cycle. Each stage requires different management skills. Our methodology determines where the business is in terms of the above life cycle and more importantly whether the structure, personalities and skills of the management team are appropriate for that stage.
  7. 7. Diagnostic – Potential for Turnaround Our Diagnostic Process reviews market positioning, product sustainability and life, capability of Information Systems, cash flow and most importantly the strength and skills set of the management team. If the business is severely distressed this may have imposed stress into the management team. Denial Blame others Blame Self Despair Confidence returns Planning Results Time
  8. 8. Turnaround – Management & Money <ul><li>Asset based lenders </li></ul><ul><li>Private equity funds </li></ul><ul><li>Private investors </li></ul><ul><li>Banks </li></ul><ul><li>Our Turnaround Fund </li></ul><ul><li>Turnaround Consultant </li></ul><ul><li>Existing Management </li></ul><ul><li>Insolvency Advisers </li></ul><ul><li>Lawyers </li></ul><ul><li>Other specialists </li></ul>At the end of the day turnaround always requires both….. Management Money
  9. 9. <ul><li>Manage a business in chaos </li></ul><ul><li>Turn it around </li></ul><ul><li>Take it to World Class </li></ul><ul><li>Understand the key elements to success </li></ul><ul><ul><li>Communications </li></ul></ul><ul><ul><li>Quality </li></ul></ul><ul><ul><li>Planning </li></ul></ul><ul><ul><li>Just In Time </li></ul></ul><ul><ul><li>Talking to the customer </li></ul></ul><ul><ul><li>Focusing on what adds value </li></ul></ul>Turnaround – Simulation exercise
  10. 10. <ul><li>If it isn’t broken, don’t fix it. Change Management for the sake of it is pointless. Change4 delivers the following: </li></ul><ul><li>  </li></ul><ul><li>Competitive Edge </li></ul><ul><li>Sustainable Growth </li></ul><ul><li>Survival </li></ul><ul><li>Profit Improvement </li></ul><ul><li>  </li></ul><ul><li>Many companies embark upon programmes of continuous improvement to effect change. However, if the competition has started earlier it can often result in the gap increasing with the risk of your business falling even further behind. </li></ul><ul><li>  </li></ul>Change4 – A management change programme
  11. 11. Change4 – A management change programme <ul><li>Change4 is about Step Change for real results. It is flexible and includes the following modules: </li></ul><ul><li>  </li></ul><ul><li>Voice of the Customer. Talking to the customers to profile your business. </li></ul><ul><li>Gap Analysis to determine where effective change can be made. </li></ul><ul><li>Learning By Doing. Working with management and transferring in the necessary skills through micro modules of training. Some these may only be 30 minutes and not intrusive on management time. </li></ul><ul><li>Energise Your Team. Building and empowering the team to deliver. </li></ul>
  12. 12. Family businesses make up more than 60% of all European businesses. Succession is a major issue and many will fail because of the lack of a Succession Plan.   Succession Planning Ownership Management Family We use the accepted standard of the three-circle model. All need to be considered when introducing change
  13. 13. <ul><li>Survival - Short term cash generation </li></ul><ul><li>Recovery – Finance for the Turnaround and business growth </li></ul><ul><li>Investment Ready – Preparing the business and the management team for investors </li></ul><ul><li>Minimising the investment – By effective cash flow management </li></ul><ul><li>Maximising the return – By robust planning, executive development and realistic and attainable targets. </li></ul>Access to Finance
  14. 14. Contacts Harry Moore [email_address] +44 7843 009887