by Richard S. Sloma ‧ RELEASE DATE: Oct. 1, 1985
An estimably practical, step-by-step guide that provides detailed directions for identifying and correcting the problems of manufacturing enterprises in financial difficulties. A corporate executive turned author, Sloma points out early on that turnaround candidates need not be in extremis, sinking dramatically in seas of red ink; many, in fact, may only be headed for trouble or failing to realize their profit potential. With the assurance of an old hand, he catalogs more than two dozen symptoms of immediate and/or eventual distress; among the possibilities are margin erosion and increases in unit labor costs. Next, Sloma lists nearly 50 diagnostic/analytic tools (ranging from reliably audited income statements and balance sheets through capacity utilization rates) that can be used to determine the extent and nature of the company's woes. When it comes to input data, though, he commends the art of approximation, noting that ""precision will clearly identify a particular spruce, but it sure as hell won't tell you what the forest is all about."" Likewise, Sloma favors ""sanity checks"" to ensure that bold recovery plans do not violate operational realities--or common sense. Once requisite judgment calls have been made on just what ails a struggling firm, it's time for remedial action. Sloma offers over 30 prescriptions, cautioning they must prove effective, not just efficient or expedient. On grounds that uncertainty is prospectively more disruptive than misinformation, he emphasizes the importance of keeping the work force, creditors, customers, and other interested parties fully advised. Among other measures, Sloma suggests deep-discount sales of slowmoving inventory (to raise cash), renegotiation of bank lines as well as union contracts, elimination of unprofitable accounts, and judicious price increases (which can produce an interim gain in orders from customers eager to stock up before higher postings take effect). He also outlines ways in which turnaround managers can keep tabs on their handiwork, e.g., by monitoring compensation/revenue ratios or other telltale indicators over time. Pragmatic, practicable counsel from a pro.
Pub Date: Oct. 1, 1985
Page Count: -
Publisher: Free Press/Macmillan
Review Posted Online: N/A
Kirkus Reviews Issue: Sept. 15, 1985
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