Top 12 Outstanding Turnaround Management Firms for 1993 SMP Rounds Out 12 the Best!        Text By Christine Evans, t & w Staff Writer   turnaround & workouts magazine , 1993. SECTIONS: SMP Selection t & w had more to say . . . SMP cases Article Text   Top 12 Outstanding Firm in 1995 Outstanding Firms 'Hall of Fame'

Outstanding Turnaround Firms of 1993

Big Results and Unusual Assignments for Consulting Firms

The T & W editorial staff made its selections of the outstanding turnaround management firms of 1993 using both public information and information provided to us by the firms. We appreciate the efforts of all participating firms and recognize the diffieulty many faced in describing often confidential assignments.

Our selection of Jay Alix & Associates, DSI and Alvarez & Marsal had as much to do with their unusual accomplishments in 1993 as their leadership position in the industry. Jay Alix & Associates' work with National Car Rental, a General Motors subsidiary, earned them a place on this year's list because the car maker has never sought outside consulting assistance before. DSI was included on our list because of increasing revenues every year for the last 18 years, the opening of two new of fires in Los Angeles and Boston, and the receipt of some of the largest fees in the industry during 1993. Similarly, we felt that assignments with Phar Mor, Gitano and Resorts International made 1993 a banner year for Alvarez & Marsal.

While most turnaround firms work across many industries, we felt it was important to include a few firms who bring expertise to industries undergoing dramatic change. Strategic Management Partners was selected for its work in defense conversion and corporate repositioning. Their work of rebuilding companies by developing new business was a favorite of the editorial staff.

The Pace Group's focus on health care, particularly HMO's and managed health care facilities, mandated their inclusion on the 1993 list. The world wide trend toward conversion of government run enterprises to private businesses landed Hadco, a firm specializing in privatization, on this year's list.

We also wanted to recognize those firms taking on particularly challenging assignmeets in 1993. We chose Sigoloff & Associates because of Sanford Sigoloffs decision to serve as Superintendent of the California school system, during a time when the nation's schools are facing unprecedented levels of violence and public criticism, as well as severe budgetary constraints. Palmieri made a place on the 1993 list for undertaking the turnaround of The Mutual Benefit Life Insurance Company, the largest failed insurance company in the history of the United States, with $13 billion in assets. Finally, we felt that Durkee Sharlit's turnaround of the Oakland Tribune, during a time when the newspaperindustry is facingconsolidation and extreme competition, was a noteworthy challenge and one that was successfully resolved.

While clearly many restructurings involved difficult decisions, scaling back of division operations and reduction in employment, the editorial staffhad abias toward firm interventions that went beyond financial restructuring and cost cutting to address marketing and product issues. Our selection of Glass & Associates, a medium sized firm, was based on a turnaround involving extensive changes to a product line. We were further impressed by the opening of four new offices in 1993. Executive Sounding Board made our list as a particularly strong small firm. Their description of a health care assignment involving extensive operational changes impressed the editorial staff.

Hamstreet & Associates' turnaround of a saw mill owned and operated by an American Indian tribe was not only extremely effective but symbolic of the positive effects turnaround firms can have on companies, employees and entire communities. The turnaround, which resulted in profitability after six consecutive years of losses and an improvement in employment levels, was another favorite turnaround of the T & W staff.

Here's What Else T&W Had to Say about Strategic Management Partners

Strategic Management Partners, Inc. was selected for its work it defense conversion; particularly for transforming federal government con tractors into companies able to compete in new commercial markets boti in the US and internationally. We were especially impressed by SMP" ability to go beyond typical strictly balance sheet restructures or crisis intervention processes and bring dynamic change based on addressing the core competencies of c ompanies who need to make dramatic market shifts SMP excelled in several criteria: Undertaking unusually challenging as signments, pioneering work in an emerging corporate renewal market where turnaround work can be expected in the future; developing creative solutions; and demonstrating outstanding results. In an era of corporate downsizing, SMP brings one hallmark to the market: It is imperative fo, companies to reinvent their businesses rather than lay off employees.

Strategic Management Partners is a transition management and consulting firm specializing in corporate renewal and strategic repositioning for forward thinking companies. According to John M. Collard, president and founder of the firm, "we believe that to enhance stakeholder valuation you must influence change and manage a company's transition. We concentrate on improving a company's value by focusing on the core strengths that will build a foundation for growth in new areas. Our strength is in focusing on 'going concern value' and 'business development' to yield the most beneficial valuation model results. We implement the transformation plan and grow a company to prepare it for ultimate 'cash out' at maximum value."

"We believe that a company must have a strong selling position in order to be vibrant and effect a successful turnaround. Cost cutting and balance sheet restructure alone isn't enough to sustain the growth needed to survive. There must be increased revenue volume if the company expects to handle the road to improvement," Collard says.

"We try to avoid bankruptcy at all costs. You can't control the process, it is very expensive and few companies actually exit from bankruptcy as a healthy entity. We stress putting the resources back into the renewal of the organization, working with all stakeholders to preserve value and save jobs," said Collard.
 

Reprinted with permission. Turnaround & Workouts magazine 1993. Copyright 1993, Strategic Management Partners, Inc.

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