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Updated 03 July 2019

Introduction from WFL

Turnaround is what many senior executives coming off the permanent headcount want to do.

It is one of the most difficult sectors for Individual professionals to get into.

The core definition and scope of the “classic” Turnaround is still relevant. We define it later in this Section.  We explain what this market is, how it works, its positioning and how you can best get into it and prosper.

However, the real value of this Section lies in recognising that the definition and scope of Turnaround has changed hugely since the word gained currency – probably over fifty years ago.  Since that time, it has expanded exponentially into a broad and all-encompassing profession but, at the same time, has subdivided into niche operational areas.

What has been called “Turnaround” is now also called “Transformation” or “Profit Improvement” or “Post-merger Integration” or “Restructuring” or “Transaction Services” or “Right-sizing” or  “Change Management”   At the other end of the market –  the “unhappy” end of the market – it is called “Insolvency” or “Administration” or “Liquidation”.  Whilst the qualification of “Insolvency Practitioner” (IP) is required for formal appointments, the same skills, knowledge and experience exists in many profiles of professionals active in this overall market.

What the entrant to this professional sector needs to do is to understand the totality but pick a target.  As in all areas of independent professional working, the answer lies very much in acknowledging and understanding generalism but focussing on specialism – finding the work and being good at it. Getting the occasional break also helps.

“Acknowledging and understanding generalism but focussing on specialism – finding the work and being good at it.”

If there is ONE encompassing phrase that sums up what you need to be good at, this is it!

It also needs to be borne in mind that the form of working covered in this Section is characterised by being non- permanent (in the generally understood way) and off-payroll (in a very modern way). It is important to see it as just a small and specialist part of the 45% of the 32.7m total working population of the UK who are NOT full-time permanent employees on someone’s payroll. Please read about the “Self Drive Worker” in Section 4.

Your task is to decide on your “Professional Product” – to work out how to position it, develop and sell it and to whom and how to make it work for you.

Technical Topic Partner

The Lead contact here is David Bryan, “a broadly experienced, international and commercial Chartered Accountant and MBA”.

  • David Bryan
    David Bryan
    Co-founder & CEO, BM&T

[email protected]

What is a turnaround and how can it support the financial recovery of a business?

A starter definition

The definition from Investopedia is as good as any.

A turnaround is the financial recovery of a company that has been performing poorly for an extended time. To effect a turnaround, a company must acknowledge and identify its problems, consider changes in management, and develop and implement a problem-solving strategy. In some cases, the best strategy may be to cut losses by liquidating the company rather than trying to turn it around.

What is difficult to define is how this master definition has and is fragmenting into its constituent parts – and new ones are emerging – each requiring different niche expertise, knowledge and skill-sets – and marketing approaches in securing assignments, commissions and work.

The difficulty in breaking down the totality of Turnaround into Sections – as below – is that so much of what is important defies being broken down!  So much of it crosses boundaries. An understanding of one Section calls for understandings of other sections. The variables need to be understood and appreciated.

The word Turnaround is not always used strictly per the definition. Many people use it at all stages of decline. When applied to the early stages of decline it is often more a major change of strategy and doesn’t normally involve severe financial distress and a “near death” experience. It is also a term that has been hijacked by Insolvency Practitioners (IP’s) to describe various insolvency processes. It is very questionable whether a formal insolvency process with the associated value destruction is a turnaround. It is a statutory process which more often than not involves the trading assets of the business being sold and the rump of the company being liquidated. In order to undertake such a process, you have to be a licensed IP in the UK. This takes many years, is highly regulated and is unlikely to be relevant to WFL members looking for an individual career.

These are the specifics that need to be addressed, being Section headings in the Institute of Chartered Accountants best practice guide to Turnarounds, a copy of which can be found here:


Alternatively, you can access selected topics directly as follows:-

  • Scope and Definition of a Turnaround
  • Basic requirements for a successful turnaround of a distressed business.
  • Managing the immediate liquidity crisis
  • Assessing business viability and enterprise value
  • Managing the business operations during the turnaround process
  • Supporting management in communications and stakeholder management
  • Establishing the forecasts and business plan
  • Negotiating the financial restructuring
  • Exiting the leadership role (CRO)
  • Managing international and cross-border issues
  • Risks and reward
  • Summary and conclusions
  • As mentioned earlier, the word Turnaround is used in many different places on the decline curve. At the top it is more about strategy and the change management skills to implement.
  • As you go down the decline curve it becomes more specialised and very specific skills and experience are required to operate in the zone of insolvency.
  • There is also more risk on a personal basis, the closer to insolvency you get. It is highly likely you will be a shadow director in the eyes of the law and there is a fine line between doing everything possible to save the business and knowing when the business cannot reasonably be saved.

Such decisions require considerable judgement.

One of the first things an individual looking to get involved in Turnaround should ask themselves is what level of risk you are comfortable with. Do you want to be in the thick of it making difficult decisions, often with imperfect information? Or would you prefer to be in a less stressful situation without the liquidity pressure and the time to take a more analytical approach to the changes required to restore the business to good health.

An obligatory consideration around your involvement must relate to the specialist areas of turnaround where you contribute but without taking the overall responsibility for the turnaround effort. Most turnarounds require some specialist skills to resolve underlying problems – for example, aspects of Procurement, IT, Supply chain and logistics, process optimisation, new product development and many others. Would your specific expertise enable you to make a real impact in a particular area of turnarounds?

The idea of changing the fortunes of a business through an effective turnaround can be a very attractive proposition for many executives starting a career as an independent and it can be very rewarding work. But context is important. Honestly appraise your skills and experience and what it can bring to a turnaround and ask yourself what you would feel comfortable doing. That should help you decide how you market yourself.

Most professionals operate as individuals through a limited liability company.

  • At the larger end of the market, the big accounting firms and consultancies dominate.
  • Alongside these, there are increasingly networks and alliances forming, often loosely based, which enable individuals to work together and benefit from the marketing efforts of a brand. This practice fits well with independent professionals who are known and trusted but who are also free to pursue work in their own name or through other firms.
  • Other individuals team up to work together on larger jobs or to refer work when they aren’t available or don’t have the relevant skills. It all allows a flexible approach.
  • In order for any or all of this to work it is critical that you network extensively and get to know the key players in your chosen field who can help you win work. See Technical Topical on Networking.

Be aware that turnaround work is nearly always based at the client’s premises and can mean extensive travel and staying away from home. The work can also be “lumpy” with fallow periods between projects.

Turnaround professionals can be anybody who likes the idea of restoring an ailing business to good health. It appeals to many, but you do have to have a clear ability to add value and get results. All turnarounds have a degree of pressure and it is not for the faint hearted. That pressure can become very intense if stakeholders are looking at losing money or their livelihood or both. Many people come into this area of work having been through a company getting into difficulty and going through a turnaround.

The various stages and activities undertaken in a turnaround are set out in the ICAEW Guidelines mentioned earlier and demonstrate the variety of skills and experience that might be called upon.

These include:

  • Crisis management
  • Stakeholder management
  • Cash / working capital management
  • Disposals, closures, cost reductions and downsizing
  • Operations improvement
  • Revenue and margin enhancement
  • Refinancing
  • Interim management

Turnaround professionals don’t possess all the expertise required and will often find themselves working as part of a team in some way or another. Given that significant change is normally required, there is nearly always a need for many types of expert advice. Rarely does a turnaround not involve lawyers. Other expertise required might include tax experts, valuers, IT consultants, HR consultants etc. Often the Turnaround professional sits in the middle of all this. He needs to know when to ask for expert advice and often has to ensure that the whole team knows what is required at all stages. In a pressurised situation, it is a demanding role.

  • Numeracy is crucial.
  • As is a strong feel and a creative sense for strategy and business dynamics. (Like – having done it successfully at senior levels!)
  • You need to keep up to date with Governance – Company Law and procedure.
  • You need to know about Insolvency legislation and practice and also taxation – although having recourse to advisors is integral to this.

Historically there haven’t been any training programmes – maybe because there are no recognised accrediting turnaround professional associations.  Most successful Practitioners see extensive experience as their primary professional qualification. The nearest we have to professional associations are the TMA and the IfT – see list.   There is one exam-based qualification in the process of being launched by the European Association of Certified Turnaround Professionals (EACTP), an organisation connected to the US Certified Turnaround Professional qualification.

The two main organisations active in Turnaround are the Turnaround Management Association (TMA) – www.tma-uk.org

and the Institute for Turnaround (IfT) – www.the-ift.com

TMA is a worldwide organisation, founded and headquartered in the USA. It has chapters in many countries and the UK one is very active with over 300 members. The IfT is primarily a UK based organisation. Both run a variety of events in London and the regions – many with technical objectives.

Is there such a thing?

This is a continuously changing area and routes to market have become and continue to become more fragmented and reflect changing definitions. Defining your market as “turnaround” is not helpful when your prospective client calls it something else!

Probably the best place to start identifying your market is by defining your own professional product. Then work out where that specific offering might best find a buyer. Doing this thoroughly and consistently and patiently should result in a list – say 100 – 250 names depending on exactly what you are targeting – of potential clients. This should work.  When it works – that is your Market.  Keep developing it and equally don’t be afraid to prune out those who are not helpful!

However, we do need to make some attempt to define the Market. If these are organisations who initiate work/ projects/ assignments in the broadly defined Turnaround area – and also individuals who do the same – either within corporates or operating independently – this is likely to be where you find them:-

  • The Restructuring Departments of the top four firms of Chartered Accountants / Consultancies.
  • ….. and also within the next tiers down
  • The same Departments in specialist law firms and specialist turnaround and insolvency firms
  • Interim management agencies
  • Certain professional associations
  • Banks – (see Note below.)
  • Alternative Lenders (See Note below)
  • Individual organisations with identified challenges – and seeking to find solutions through personal contacts.

All of the above need to be identified through your own Research and will take the form of Individuals – either within Corporates or trading independently.

In practice, you will identify both organisations and individuals simultaneously.  But you do need to finish up with named individuals within named companies – for your contact list.  Reaching – say- 250 is a sound working target but accept that will take time.  You then start developing working relationships with these names –

In the less stressed end of the market it will largely be about networking and building connections as a trusted advisor or as an interim manager brought in to implement strategic change. If you are an expert in a specific sector, you will likely focus on your network within that industry and on widening that network within industry associations. Alternatively, you might be an expert in particular service to bring about change. It might be lean production, new IT systems or moving into online services. Whatever the skills you will have to work out who your potential customers are and how you are going to reach them. In general, situations higher up the decline curve will require sectoral expertise while those near insolvency require situational expertise. As an independent, you are a one-man business and you need marketing as much as any other business does. That may not come naturally to those who have had marketing support as part of a large corporate, but it will have to be learned if you are to be successful.

Note re Banks.

At the more stressed and distressed end of the market it used to be that bank workout departments were the main source of work. They would insist that a customer in difficulties seek help and had a panel of advisors they would recommend from. This always had an inherent conflict of interest. Who were you were working for, the company that engaged you and paid your fees or the bank who were your main source of work? There were cases of sudden insolvency resulting in unpaid fees for the Turnaround Specialist involved and, where applicable, any introducing intermediary.

Inevitably, the banks became much more sensitive about their role in this following the adverse publicity surround RBS’s Global Restructuring Group and HBOS’s Reading office scandal.  The current position is that little work now comes from these bank sources. One can speculate as to other reasons for this. But, for a while, it did create good levels of activity in the Turnaround Market.

But other factors have also had an effect. The cost of holding problem loans has risen dramatically for banks with the much tougher Basle III rules and other central bank pressures on their tier 1 capital requirements. In parallel with this there has been an explosion in debt trading with a huge number of finds, large and small now buying debt from banks, often so called Non-Performing Loans (NPL’s) or the Unlikely to Pay (UtP) category. For banks it is now much easier to just sell a problem loan rather than work it out and that is happening more and more. Most have wound down their workout departments.

Alternative Lenders

At the same time there has also been a dramatic rise in all types of alternative lenders, particularly in the SME market. These include the small challenger banks, online invoice discounting platforms, peer to peer lenders, crowd-funders, credit funds etc. Some are hardly regulated at all and how they will deal with any significant number of problem loans is yet to be seen.

The funds that buy debt have largely focused on consumer debt (credit card debt etc) and mortgage backed real estate loans. These have little requirement for turnaround professionals and are largely a matter of collection / enforcement. Corporate debt purchases have been relatively small but there will be a need for turnaround professionals as more such debt is traded although it remains to be seen exactly how this market will develop for turnaround professionals.

No matter how the market evolves in the coming years, the route to winning work will almost certainly remain centred around networking. Clients only hire people they trust and those people need to have demonstrable expertise and a track record. That can be hard to build as an independent and it is not for everybody. But for those that do it can lead to a very rewarding career.

In this Section, the temptation is to repeat so much that appears elsewhere.  But it is all inter-related.

At the outset you need to be very self-analytical.

Not easy when you’ve got to a senior level in business and you think you’ve done all this before.  In any case, you might think, why is it relevant? It is relevant because you are starting a new career – you might know most of it – but you won’t know all of it! Not sensible to cut corners or take risks with how you are going to make a living from now on!

Please read Section 3 of www.WorkingFree.co.uk – about being self-analytical.

Please read Section 5 of www.WorkingFree.co.uk  – about the self employment market.

Please read “The Supporter’s Guide” – about getting some one your respect others to honestly critique your ideas.  This is a Working Free innovation which deserves serious study.

Business Planning & Strategy

You should treat yourself and your professional activities in the same way that anyone running any business would treat their own business. You need a Business Plan.  Within this, you need a Marketing Plan – which is about what you have to do to get your product to market and you need a Selling Plan – which is about how to get your Marketing Plan operational. You need to give yourself demanding and specific targets and a programme to achieve them.  You also need to adhere to your programme – and accept that it may demand mire time than you feel comfortable with.

Please also read the Technical Topic on Networking. This is the base for your Marketing and Selling

These are some of the questions that need to be addressed:

  • What are your skills and experience? Be very specific.
  • How much in demand will there really be? Different areas peak and trough differently.
  • What differentiates you from others? This also includes being “better” than direct competitors
  • What do you really want to do? May be your last chance to do what you want to do rather than what others want you to do.  Do you really have to compromise?
  • What is your appetite for risk? Don’t be silly.  But you can be brave!
  • What sort of business and situation would be your ideal client? Best to “choose” what you know a lot about.
  • Who would appoint you to carry out such work? Needs to be a decision-maker. And someone you get on well with!
  • How are you going to get your name in front of them? Take this seriously!

Remember that companies do not advertise their difficulties. Quite the opposite!

2021 Working Free Limited · Call us on 08081 565604 · Message Us · 73 High Street, Newport Pagnell, Buckinghamshire, MK16 8AB United Kingdom Disclaimer: Working Free Ltd cannot accept any responsibility for any loss or disadvantage that may arise out of reliance on any opinions, material or introductions made through this website and all those making use of these services should take appropriate business and legal advice and conduct appropriate due diligence before making any commitments.
David Bryan
Co-founder & CEO, BM&T

“I’m a broadly experienced, international and commercial Chartered Accountant and MBA. I have many years CFO experience in industry and as founder of a plc acquisition team.  You can read more about me on LinkedIn. I am a founding partner of a boutique consulting firm – www.bmandt.eu  (please see our website).  Our firm specialises in cross-border turnarounds, performance improvement and M&A assistance. We are part of a European network and affiliated to a US firm. Our network comprises 180 professionals across Europe and North America, all experienced board level people who like to be hands on rather than writing reports.

I started in a regional firm of Chartered Accountants and on qualifying went to United Technologies, a very large industrial conglomerate. After a year out for an MBA, I joined Mayflower, a newly listed company. In the next 10 years revenues grew from £13m to £700m. Market cap went from £6m to £500m. A fantastic growth story. But five years later Mayflower was insolvent. An incredible 15 years’ experience and what brought me into the turnaround field. I was an interim manager for several years post Mayflower and began to work extensively with a US based turnaround firm’s European arm. After the firm was sold to a large consultancy in 2007 two of us reformed the European arm as an independent firm and gradually built up our network of liked-minded people and like-minded firms. Over the last ten years we have worked on turnaround and restructuring assignments and post-acquisition integration projects for clients all over Europe and North America. Clients have ranged from just a few million pounds in revenues to almost £1.5 billion. I was on the board of the TMA UK chapter for almost ten years and recently became President of TMA Europe.

My role is to help develop the content of this section on the WFL website, with oversight of all the Contributed Material that comes in, working with WFL to decide how best to handle it and, importantly, answering any queries that you might have – which, in some cases, might mean referring back to WFL.”

Whether you are a beginner or an experienced Practitioner, it is important that you acquire a broad and a sufficiently detailed understanding of the Turnaround Market, keep it all up to date and be able to relate it to your own professional Practice – and beyond – and fit it in to your personal business and lifestyle aspirations.

With WFL, we also organise individual and group face to face meetings for aspiring and established Practitioners, often collaborating with external organisations.  These can be ad-hoc responses to demand – in different places and of different sizes but broadly following pre-arranged Agendas and all tend to be priced differently.”

More info from [email protected]   This website offers many opportunities to email us – through the TTC facility. Additionally, you can always email us directly.

Please note the David Bryan is a co-author of “Best-practice Guideline – Turnarounds “ along with his business Partner, Alan Tilley of Bryan, Mansell & Tilley LLP and Stephen Cork and Katie Moffit of Cork Gully LLP.  This important booklet was published by the Institute of Chartered Accountants in England and Wales (the ICAEW) in May 2011.  The principles have not changed.  What will have changed are the metrics and the people-driven variables.  This Section of Working Free contains links to this Publication – and we thank David Bryan for making this possible.

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