There are distinct phases in the turnaround of an underperforming or troubled company which are similar to those used in repositioning the strategies of many successful companies. Although the phases may be similar, the one critical difference is the time and resources available for planning and implementation.

Most companies go through various stages of growth and decline, all of which present unique challenges to management. It is important to understand these stages and their symptoms, especially for underperforming and troubled companies.

The real challenge in any turnaround is getting everything done fast since time is tight, money is tighter and in reality you can't afford the luxury of devising elaborate strategies and plans and expecting flawless execution.

Our experience has taught us that:

• Investors, lenders and executives normally wait too long before taking decisive action.

• Operating and financial problems are not self-correcting. In many cases, these problems cannot be corrected with existing resources.

• Quick operational and financial fixes generally provide relief only until the next crisis occurs.

• An external change agent is often required to effect meaningful and long lasting change and this decision can be a very difficult for a troubled company.

• Experienced turnaround professionals:

• Bring a sense of independence and urgency to stabilize or assist in stabilizing operations and cash flow.

• Allow the company to buy the need time to develop a credible turnaround plan that can be supported by lenders, vendors and shareholders.

• Focus the company's efforts on present realities, fix only that which is broken and concentrate their efforts on those areas of most significant strategic benefit to both cash and profitability.