Whether you are restructuring a failing business, restructuring to support expansion into a new revenue stream or restructuring to create an opportunity to pass the business on to a family member or sell it, you should have started months ago. Change takes time, and the restructuring process includes many levels of endeavor. Unprepared, a restructuring process can take as long as five years. If it must be completed within a 12-month period, the best approach is to set quarterly tasks that include research, decision making, implementation and review.
The most important part of restructuring lies in defining the problem and postulating the solution. Allocate the entire first quarter to this task. It requires a careful study of all company processes and a comparison with industry norms. Study relationships with customers, their product acceptance and expectations of benefits from your restructuring. Examine employee expectations and potential for damage to morale. Review all supplier and customer contracts, revenue performance, expenses and liabilities, including responsibilities to investors. This is a lengthy process and may take as long as six months.
You can start forming decisions during your research phase because it will reveal strengths, weaknesses, opportunities and threats throughout your enterprise. It may also affect your understanding of the problems you seek to solve as well as change your postulated solutions. By the end of the second quarter, your major decisions should have been made and your plan should be ready for implementation. Involving all levels of the company and outside stakeholders in your research and planning process will speed decisions and result in easier implementation.
Implementation is the process of managing problems that arise. It involves selling the idea to all stakeholders, which include employees as well as investors, suppliers and customers.