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FEBRUARY
67
“Organisations can easily lose their way when they don’t focus. This is especially true of small
and mid-sized businesses, but it can also affect large businesses, too...”
BUSINESS
FOCUS TIME
There are many reasons why companies fail
or fall into a period of distress. Poor
execution of strategy or a failure to rapidly
address challenges to the business, such as
market disruption, cash flow, or even new
regulations can all be contributors to a
perfect storm for business transformation.
Successfully turning around a troubled
business can be challenging, especially if it
is performing poorly, lacks quality
management information and/or a clear
direction. Having spent the last 17 years
turning around distressed businesses, in
2015 I was invited to become part of the
non-exec team at a company called Coms
plc; a group of businesses with diverse
interests from telecommunications through
to IT infrastructure and digital media. The
company was in a state of financial
distress, and we needed to look at how we
could transform the business rapidly.
Two years later, the business, now called
RedstoneConnect, is focused and successful;
a market leader in smart building technology
and software applications, with annual
turnover approaching £50 million. Although
hard work and challenging, the plan to
transform the business was relatively
straightforward. The business had to focus
on what it was great at, divest itself of
everything that distracted attention and
with refinancing, concentrate on
Mark Braund
, CEO of RedstoneConnect,
shares some of the lessons he has
learned while turning his business from
distress to success
Transforming
your business
aggressively winning in a market with
high growth.
The company benefits from some
remarkably-talented people that when
provided with a clear strategy and the odd
sprinkling of good fortune, have succeeded
in not only turning the business around, but
building a business that has huge potential
for global growth. We are by no means
finished, and we have huge ambitions and
the talent to achieve them. As we step back
to consider what the team have achieved so
far, let’s highlight some lessons learned
along with some from previous successful
business transformations.
Get under the skin quickly
It is essential to learn everything about the
company, its strengths, its weaknesses,
which areas of the business are wasteful
and which are strategic assets. We quickly
found three key challenges. Firstly, the
company was trying to be successful at
doing too many disparate things, it was too
diversified. As a result, the best performing
parts of the business were starved of
investment while they supported the parts
of the business that consistently
underperformed.
Secondly, the strategy was unclear and
communication across the group very
fragmented, meaning that not everyone
understood the company’s goals and
objectives. They therefore lacked
empowerment and became somewhat
disengaged.
Thirdly, parts of the company were not
sufficiently engaged with its customers, as
such it struggled to understand the future
direction of the market. Staff that did had
their voices drowned out by the pressing
needs of the underperforming parts of the
business. As a byproduct of this, the
company focused on selling the services it
had rather than looking forward to
understanding with clarity the value of
creating and selling the solutions their
customers were developing a need for.
Fixing these three challenges, alongside
providing financial stability, provided the
bedrock onto which the business built its
recovery.
Focus
Organisations can easily lose their way
when they don’t focus. This is especially
true of small and mid-sized businesses, but
it can also affect large businesses, too.
Those that diversify, especially before they
become dominant in their core market, run
the risk of being too thinly spread.
Commercial businesses must concentrate
resources to be the best in market –
everything else becomes a distraction.