Time zero: overcoming the crisis

The road to recovery of a company involves numerous steps required. The first is the awareness, by the leaders, that something must be done urgently. Recognize that it is not well is a reasonable, but may hurt the pride of the leaders. Meanwhile, the company does not have any pride: maximum play more firewood in fireplace. Instead, the leadership takes the humility to recognize the errors and defects and find the logical way to solve the crisis. The first step should be to achieve the diagnosis.

The crises arise and spread within the company. People get sick because the body can not react to the presence of germs. In the same way, companies are in crisis because the body - the body corporate - not react to internal and exte
al factors that cause difficulties. The magnitude of the factors that affect and determines the magnitude of the crisis. It was not for nothing that the financial crisis in the United States dragged into bankruptcy many institutions that were unable to react. But the commitment of these institutions with operations in high risk was the determining factor.

The diagnosis is a real check-up, indicating a global shortage, allowing instabilities predict and assess future imbalances. It is an irreplaceable tool to put in focus all disharmony between the structures of the enterprise or between business and socio-economic reality in which its action unfolds. Your staff is motivated? Its products are profitable? Its structure, administration, production, marketing and sales is appropriate? Your accounting system and cost reflects the reality? Already reviewed its procedures and methods of production? The diagnosis is therefore an indispensable tool in business of great or small, to help overcome the crisis and recover the organization.

Once the diagnosis, the consultant will submit its report, widely discussed with the direction of company. Pointing out the problems encountered, the report also indicates the recommended solutions. However, the consultant does not take decisions: only suggest corrective measures. The direction of the company may refuse the recommendations and do nothing about it. Or, to be more sensible, resolve to tackle the problems recover the organization.

Many may be the measures to be implemented: adoption of strategic planning, setting goals and targets in the short, medium and long term, implementation of a methodology for financial planning, with the control of cash flow over the long term (120 months); adoptio
Annualized budget operations, planning all operations of purchase of raw materials, manufacturing, storage, sales, billing, labor, accounts receivable and payable, cash flow, profitability, balance, determination of income, etc. .; adoption of a methodology for analysis of costs and profitability of products (Method 3D or similar); adoption system to analyze the evolution and trend of the company's performance over the last 4 years, the period may be extended, recasting internal controls the company, including the physical and financial aspects and improving data security and patrimony; restructuring of accounting, adoption of a new chart of accounts, restructuring of system costs, implementing a program of optimization of costs, adoption of study value engineering; re-study of the processes and methods of manufacture (for Industry), adoption of a plan for jobs and wages to stimulate the motivation of workforce, recognizing and rewarding the efforts of labor, establishment or revision of procedures internal audit; greater supervision over the operations of cash and more, if necessary.

The road is long, the resistance to change is intense, much misunderstanding and mistrust everywhere that always happens in similar situations. But the leader can not yield to pressure. If before, with the crisis, there was a nebulous way, the diagnosis brought a new light on the problem. We can say that the diagnosis is the last company to clean. The diagnosis begin to outline new directions for the company, setting goals to be pursued. With the measures suggested by the diagnosis, many obstacles will begin to be removed. For example, the Method 3D will profitability analysis of the factors affecting the profitability of products. Hence there other measures that attack the problems identified. The plan for jobs and wages correct the distortion detected and certainly positively affect the motivation and enthusiasm of employees. The flanges of the financial area will be corrected with the adoption of new and improved controls. The processes and production methods will be improved by reducing waste and improving the flow. A new system will provide a cost effective monitoring and control of production in financial terms, pointing out the shortcomings and providing further savings.

The corrective measures and their results do not occur all at once. The initial step was the diagnosis. The following steps are a result of the facts mentioned. As the ideas, suggestions, corrective actions are being implemented, the company will go through a process of restoration. The sequence of these steps will Unmounting the crisis step by step. Monitoring the direction of the company will assess the progress of the fixes implemented. However, no corrective measure can be stopped. If this occurs the company run the risk that the crisis back, with the return of the problems unresolved. It will be like a team that plays in a building restore worn and dirty. The work will be done in a sequential, remaking the brick, the plaster, the wood, water, electricity and painting, until the property is fully restored. Thus, the corrections made step by step to let the company working properly, as an engine perfectly adjusted and lubricated. When you reach that point, when the last problem is solved, we can say that the company will be as a vehicle zero kilometers. This is the time zero: the starting point for a new enterprise, restored and without crisis. This is the purpose of diagnosis.