December and January â€" when it’s quiet â€" is a great time to take a long hard look at your business, and to
prepare for success in 2018. It is a time to reflect and take control, to resolve to work at your business instead of in your business.

Last month in a restaurant I saw a small child hit her head against a table and heard her mother saying, “naughty table!” When our setbacks are seen as always being someone else’s fault, this is the most disempowering attitude we can have towards our businesses. Why? Because if we believe issues are somehow outside our scope of influence (not our “fault”) then we are unable to believe that we can fix them.

Too often I hear from my clients that it is the economy, it is the staff, it is suppliers or the clients etc., etc. Many, many outside reasons for poor business performance. Of course, this does not mean that there are
real external reasons for why a company is in trouble or stagnating, but unless owners and managers take full responsibility for what they can do, we are unable to fix the problem.

As a turn-around specialist and rescue practitioner I am often confronted with a request for business rescue and clients wanting protection from creditors. In most cases, after a short discussion it will become clear that creditor protection would be treating the symptoms and not the cause of the problem. At the same time â€" and understandably so â€" the creditors are tired of the same promises from business owners â€" ‘we will pay, next week, next month’ or ‘soon’, without getting a good understanding of exactly what is being done to make sure that payment happens.

I have the privilege to use business rescue as a stick, rather than a tool. If we look at the statistics, very few business rescues can be considered a success for all parties. More often, they are no more than a liquidation, with a few extra cents on the Rand for the creditors. The process is expensive and in many cases the lawyers, forensic auditors and other professional chargers will take all of what can be taken from a company. Since they are preferential creditors there will usually be nothing left for the rest of the unsecured creditors once they are done. I have the greatest respect for lawyers, but they are hardly an example of entrepreneurship and simply don’t have the skills to fix or turn-around a business back to profitability.

So here is what needs to be done for a business stagnating or in trouble.

Get in a good business consultant who will do a proper analysis of what went wrong and why. Make a business (either genuine rescue/business improvement) plan, which sets out how the problem will be fixed, and by when. This business plan must include full disclosure and ongoing monthly updates to creditors, so that they feel part of the solution. The plan will include details of how all staff and management will act to support the turnaround plan.

Present the detailed plan to creditors, allowing them to discuss it with their auditors. In my experience, once a creditor understands the full story of failure and is presented with a detailed turnaround plan by a professional business consultant, they are almost always willing to co-operate. They know full well that they will probably be looking at a much better result than with a liquidation. Most creditors are business people and when given the option to trade out or be subject to a judge and lawyers who know little or nothing about entrepreneurship they will make the choice to go the commercial route.

Finally â€" even the best plans are nothing without even better execution; no one will remember a good plan without it! 

Hein van Spaendonck is the Principal Consultant at Thyme-Workshop, and readily admits to being addicted to helping businesses succeed.

He can be contacted on 082 905 5509 and hein@thymeworkshop.com. More information at www.thymeworkshop.com