Professional crises can occur rapidly over time without expectation, the reputation and livelihood of your organization, its stakeholders and clients can be jeopardized by the consequences.

Crisis management thus become the focus when dealing with a significant or sudden negative event that takes an organization to the brink.

In this activity named “Crisis Turnaround – War Stories from Professionals”, Swiss Chinese Chambers of Commerce, BenCham IsCham, AustCham and ATTA put together a panel of professionals who work daily helping companies in distress to share their stories of making contingence plans to deal with crisis and turnaround on 28th November to help the guests avoid the mistakes the others have made.

Challenges for Interim GM Assignment: Change Local Management, Correct Management Processes and Find Successor

Small auto component company in automation. Growth is slowing and profit is declining. GM does not speak English, Marketing Director/Second in Command speaks some English.

GM made many important decisions without US CEO approval: bonus, merit increase, etc. Local GM has asked HR/Office Manager to leave. Finance Manager worked at home to avoid being fired.

US CEO decided to remove local GM and Marketing Director. I stepped in as Interim GM.

Challenges for Interim GM Assignment: Change Local Management

US CEO and I surprised GM and MD when I asked them to resign on Monday. GM and MD asked for their severance packages.CEO agreed.

A few days later, former GM phoned me and demand immediate payment of his separation package. He wanted to change his severance payment to be fully tax free. CEO agreed (wants to be a friendly separation.) I asked him to delay until Thursday afternoon even though I will not be in the office on Thursday.

On Thursday morning, Finance Manager called me that former GM showed up with someone who looked like a lawyer and two hoodlums demanded immediate payment.

I called former GM. He told me the lawyer-like person is his friend from local tax bureau. If the payment was not made, he will inform local tax bureau of all the violation he had made for the past years.

The two hoodlums have blocked the entrance and will not allow employees to leave the office.

Challenges for Interim GM Assignment: Change Local Management

I asked former GM to be patient as Finance Manager needed time to figure out income tax implications.

30 minutes later, Finance Manager called me. Building lights were shut down. FM has called police, and locked herself and Accountant in the Finance Office.

I called former GM. Former GM said: I did not shut down electricity!! I told him to stay calm until electricity is back on so money can be wired.

45 minutes later, Finance Manager called me and said electricity returned, police arrived, money wired, and former GM and his people left peacefully.

I returned on Friday, and tried to calm the employees. Employees with <3 years of experience: we were shocked!

Employees with >3 years of experience: you should have seen when the last GM departed. He came in with 20 people, 10 looked like hoodlums with sticks and hammers!!

Challenges for Interim GM Assignment: Correct Management Processes

A company with very low inventory: one week of inventory!

Actually FM was told to expense all inventory purchases to avoid paying income tax. When actual value is applied to the inventory, ebitda (profit before tax and amortization) increased from 5% to about 15%.

I hired an outside consultant to “clean up” the inventory/balance sheet over the next 18 months.

Set up incentives for key sales and engineering managers. Former GM was de facto sales director.

Set up an order tracking system, end to end. Hold weekly management meeting to deal with order status and key business issues.

Challenges for Interim GM Assignment: Find Successor

Helped CEO to hire a new GM five months after I became Interim GM.

Business ran smoothly during my term and is still a profitable business today, but has tough market competition and impacted by US/China trade tariff.

Lessons learned:

In business turnaround, issues can be resolved, business processes can be refined and profitability can be improved.

But always prepare for negative surprises, they can be solved with calm heads.

About ATTA

Asia Transformation and Turnaround Association (ATTA) is a membership organization of experienced professionals providing business transformation and turnaround management services in Asia. It brings together leaders in the transformation and turnaround sector and founds a platform for these leaders to share their executive experience and industry knowledge.

泰普洛領(lǐng)導(dǎo)力簡介：

泰普洛領(lǐng)導(dǎo)力成立于2002年，以「喚醒組織潛力 賦能企業(yè)領(lǐng)導(dǎo)者」為使命，匯聚數(shù)位有國際化背景的資深顧問和實(shí)戰(zhàn)教練，依托CPI人才測評、人才盤點(diǎn)、企業(yè)定制化內(nèi)訓(xùn)、高管教練、內(nèi)部私董會等業(yè)務(wù)組合拳，為企業(yè)提供持續(xù)創(chuàng)新的人才發(fā)展和領(lǐng)導(dǎo)力解決方案。