Business Turnaround Tip for a Successful MBO Turned Awry

When you acquire a company through an MBO, your hopes are always high. You know the business more than anyone else and you’ve got too much at stake to do a sloppy job. So how could things go wrong? Well sometimes they do. And if you don’t make a quick business turnaround, you could end up losing more than just your company.

If that management buyout was financed by a bank, then chances are you were required to invest a sizeable amount from your own pockets. I won’t be surprised if you even remortgaged your house for it.

Regardless of your source of funding, whether it was a bank, a venture capitalist or through a deferred consideration, the mere thought of losing your job and getting buried in enormous debt at the same time might be too much to bear. If you get too overwhelmed by your emotions and can’t think clearly, you’ll have to step out of the driver?s seat and have someone take over.

That someone can’t be a member of the management team that took part in the management buyout. Like you, he/she might be in panic mode as well. You need someone from the outside who has no emotional attachments to the company and hence can view the crisis from a clear perspective.

Here’s what’s needed:

Review and Plan

Take a closer look at all factors affecting your business: governance and organisational structures, employees, suppliers, systems and procedures, roles and responsibilities, etc. Identify potential risks and assess the likelihood of them affecting your business.

This will give a clearer picture of cause-and-effect relationships as well as the specific tasks on hand.

Thus, when it is time to draft a plan, you can do so from a well-informed standpoint. This will enable you to target specific areas of improvement and avoid pointless activities.

Assure all stakeholders

Once a watertight plan has been formulated, you will have to approach your stakeholders. They?ll need to know what your directions are. Once they’re all sold on the plan, you could implement our strategies unimpeded.

This is a very crucial part because a sceptical stakeholder can serve as a major stumbling block in our efforts to improve the situation. You need to convince your banks, sponsors, and investors in order to avoid additional financial obstacles. You need to convince your suppliers too. If they cut off or limit supply, you won’t be able to continue doing business.

Most of all, you need to persuade your staff and employees that the proposed major changes have to be carried out in order for the company to survive. You can’t run your operations without them on board.

Redesign and set up new systems and procedures

Any company requiring a turnaround will certainly have systems and procedures that are no longer working well in the current conditions and hence would require either major changes in key areas or a total revamp. You need to study personnel roles and responsibilities as well as systems and processes, including financial and IT systems, and supervise the implementation of necessary changes.

You will need to evaluate your existing IT architecture and determine how you can best maximise what you already have and propose what you think will work more efficiently for our proposed systems and procedures. Every piece of hardware or software recommended will take into consideration your present resources. There are many solutions out there, you just need to find the best fit.

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5 Numbers showing why the Time to Invest in eCommerce in the UK is Now

A decade or two ago, you might have already had the urge to invest in eCommerce. But astute as you are, you must have decided to wait for the right time and perhaps the right place to do it. That time has come. And the right place to do it? Try the United Kingdom.

Here’s why:

1. ?100 billion worth to the UK economy

A report conducted by US-based BCG (Boston Consulting Group) showed that Internet-based business in the UK reached ?100 billion in 2009. That translated to 7.2% of the country’s GDP that year, making it bigger than industries like construction, education, and health & social work, and even slightly bigger than agriculture, hotels & restaurants, and mining, combined. Click here to see the comparison shown as a graph.

?100 billion?is certainly huge, but?the market potential of the Internet in UK is even made more evident if you also look at the numbers based on amount spent per capita…

2. # 1 in per capita spending

According to IMRG (Interactive Media in Retail Group), “the UK’s per capita spend of ?1333 (?1108) per annum” is number one in the world. This shows that people from the United Kingdom are more willing to buy goods from the Internet than other people on the planet. And this alone should tell you why UK is the best place for e-commerce.

But while you’re still pondering whether now is really the best time to invest, bear in mind that competitors who have gone to the Internet before you are already thinking of expanding …

3. 1.5 million workers in Internet retailing by 2015

Last year (2011), the number of people employed in UK e-businesses was about 730,000. While conducting its second annual e-Jobs index in 2011, IMRG (Interactive Media in Retail Group) found out that it was largely due to a rise in employment in 63% of e-businesses. The study also showed that 60% of e-businesses were also planning to beef up their employees within a year’s time.

While other sectors are shrinking their ?workforce, businesses on the Internet are growing theirs. Were they just speculating? Perhaps not…

4. 50% of parsels during 2016 pre-Christmas peak will come from e-commerce

Last year (2011), parcels coming from e-commerce accounted for 37% of all items sent through UK couriers during the November-December stretch. That volume from e-commerce was 15% higher than the previous year. This remarkable climb, which was reported by Global Freight Solutions (GFS), shows the growing confidence of customers when it comes to buying products online.

If this rate continues, items from e-commerce will easily comprise 50% of parcels by 2016. Chances this rate will continue? Let’s go to number 5 and you be the judge.

5. 66% of all adults made online purchases in 2011

A statistical bulletin published by the ?Office for National Statistics revealed that 32 million people made online purchases in 2011. That actually comprises 66% of all adults in the UK. Significant as that may seem, what is really striking is that that figure used to be 62% in 2010. So again, this proves that the number of people who buy products and services online is steadily growing.

If you really think about it, these statistics should not be surprising. The smartphone is now practically the default mobile device of anyone who owns a mobile phone. And then of course there are laptops and tablets.

With these devices on hand, coupled with the ever growing number of WiFi hotspots and telecommunications bandwidth, gaining access to the Web has never been easier.?It can be done practically anytime, anywhere.

This makes it so easy for people to search for products, compare competing brands, and eventually make a purchase from home, the office, on the terminal, or on the train.

Related post:

Integrated e-commerce ? The right way to do extend your business online

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IT Transformation Defined

Businesses depend on IT to effectively manage business processes and to provide products and services to clients. As IT technologies advance, it is crucial that businesses update their hardware to remain competitive. But businesses should do more than simply upgrade their servers and should really strive to effect IT transformation.

What is IT Transformation?

IT transformation is the ongoing process of changing the way that a company uses IT to better align it with current business goals. Through the IT transformation process, businesses try to determine whether they are meeting mission-critical benchmarks through the incorporation of new IT technologies for corporate transformation.

For example, if one of the current business concerns is whether the company can improve customer service, the IT system will need to evolve in such a way that improves customer service in a measurable way.

Successfully Aligning the Technology to Business Goals

In order to successfully align the IT system with business goals, it is important to understand the newly integrated technologies to understand how they can change business processes. If a new feature is intended to make the server more secure, the management should know exactly how the feature will improve the security of the server and whether the new implementation is redundant.

Once the business objectives have been identified, IT transformation is carried out by changing both the software and hardware used by the company. An example would be the growing trend of server migration to the cloud. Cloud computing is the growing trend of making files and data accessible from anywhere. If an organisation believes that it can improve productivity through a server cloud migration, it will need a way to test this.

The IT Transformation Process

Given that IT transformation is directly related to the core business, the IT transformation process must begin by identifying which aspects of the company must be changed. Then, the company must determine?IT services that could potentially be integrated into the business in a way that will help the company achieve benchmarks. After the key decision-makers understand the IT network well enough to effectively implement it, the company must efficiently manage the transformation process. Then, after the IT has been integrated, the company must have a system in place to measure business transformation in a numerical way.

For example, when assessing customer satisfaction, one effective strategy would be to distribute customer satisfaction surveys that ask customers to rate their experiences on a scale of one to ten. The company can then measure the results of the customer satisfaction survey to determine whether the new IT implementations are accomplishing their intended goals.

If the expected benchmarks are not being met, the next step in the IT transformation process is to determine if there is a specific reason for that. Is there a way that the feature can be better integrated to achieve desired business objectives? Are there other features that can help the company better achieve its goals?

Upgrading a network can be an expensive process and it is important to identify early on which options are the most likely to benefit the company’s bottom line.

How Sustainable is Suez Environment

French-based Suez Environment works in the water and waste-management environment, with specific reference to water production, treatment, & pollution disposal, and waste treatment, recycling, incineration and site desensitisation. Its more than 65,000 employees distributed worldwide have participated in flagship projects like Renault’s goal of 95% reclamation of vehicle parts, and Lyonnaise des Eaux?s saving of 12 million cubic meters of water in a single year.

Suez Environment claims to have consistently increased the recovery rate of treated waste, decreased direct and indirect greenhouse gas emissions, and made significant inroads into the production of sustainable energy on behalf of its clients. But then surely that’s Suez Environment’s business, and with over 65,000 employees we are entitled to expect this. Given that there have been persistent allegations of privatised water distribution bumping prices up to the detriment of the poor, how effective is Suez Environment at practising what it preaches back home?

GDF Suez is its largest shareholder and includes it under its environmental and societal responsibility umbrella. This makes environmental performance an overarching goal alongside management systems, health and safety, risk and procurement, and ethics. Its environmental ambitions spin out into the following strategies:

  • Understand the interactions between our activities and the environment
  • Open dialogue with stakeholders and foster partnerships with them
  • Set quantitative and qualitative targets at all levels of the organisation
  • Achieve optimum balance between financial and environmental challenges
  • Be proactive; anticipate impacts on the environment and plan for them
  • Increase employee awareness through interactive training and education
  • Be constantly innovative; share successes within the organisation
  • Monitor progress continuously and publish measured results achieved.

These goals direct the Suez Environment management team?s attention towards optimising performance in key areas like greenhouse gases, energy management, renewable energy, biodiversity, responsible water management, pollution prevention and health and safety considerations.

Among numerous other examples, its waste incineration programs convert hazardous and conventional waste into heat used to generate electricity without requiring virgin carbon products. Elsewhere, the same energy warms market-gardening tunnels and work places on winter days.

Suez Environment uses sophisticated energy management software to analyse information that’s transmitted by data logging devices online. ecoVaro provides a similar service in the cloud. ecoVaro adapts to your requirements providing fresh insights to your business.

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