“Turnaround Interim Management, Competitiveness and Corporate Restructuring”

Madrid, 16 January 2023

The professionals responsible for carrying out this arduous task are known as CROs (Chief Restructuring Officers), who are usually hired by interim management firms that employ interim managers specialising in restructuring. It is essential that turnaround processes are carried out by professionals with extensive experience in organisational change management, and they must be external to the structure of the organisation in which they will be working. This ensures they have an objective perspective, enabling them to act pragmatically, free from any internal influence. Of course, the external CRO relies on the team of professionals holding permanent management positions within the organisation, although on occasion they may need to supplement this structure with other managers specialising in different disciplines. In this way, mixed teams are formed comprising interim managers and executives from the company undergoing restructuring.

One of the immediate tasks these professionals undertake is to stabilise the situation, which is sometimes highly complex. Their intervention usually has a positive impact shortly after they join a company. It is important to note that these transitional CROs are supported by the structure of an interim management firm. This firm provides them with technical support and intervenes should the interim manager fail to meet their objectives, going so far as to replace them immediately with another executive, if necessary. It is this operational capacity that distinguishes a freelance interim manager from a firm specialising in transitional management services. In Spain, due to the large number of highly qualified executives available on the market, there is a tendency to confuse a freelance professional with an interim manager; however, there are substantial differences. Most of these independent professionals wish to be hired by a company to carry out a specific project, in the hope of remaining within that organisation. However, a professional interim manager is by nature itinerant; they enjoy tackling different projects across different sectors, professional fields and countries. This is one of the reasons why these professionals operate through interim management firms, most of which have an international presence, such as EPUNTO Interim Management, which belongs to the Valtus Alliance network. As well as providing them with all kinds of support throughout the assignment for which they have been hired, they know that the company will rely on them to carry out another assignment, so they strive to achieve the best possible results during their time on the project. This has been, and continues to be, the case in the Anglo-Saxon market and in most European countries, where interim management has been well established for decades.

Every restructuring process is different, although they usually share certain common features. On some occasions, Turnaround interim management services are engaged to implement measures arising from a prior analysis, carried out either by the organisation itself or by other parties with expertise in specific professional fields.

In other cases, the interim manager must oversee the entire process, which involves: assessing the situation, drawing up a diagnosis, devising the restructuring plan, implementing it and, in a final phase, evaluating the results. Subsequently, the interim management firm withdraws the interim manager, as they will have established the technical and professional framework to enable the company to embark on a new path to success following their involvement.

Undoubtedly, we can regard a turnaround as a process that enhances the competitiveness of any organisation, regardless of its activity, sector or geographical scope. When an organisation’s weaknesses, threats, strengths and opportunities are analysed, this always leads to a renewal that typically involves innovation; and this is the cornerstone of competitiveness. Currently, digitalisation – whether at the management, production or marketing level – is one of these essential factors for competitiveness, requiring a genuine overhaul of production processes and the professional teams that manage them. For this reason, some interim management firms have set up business divisions or affiliated companies specialising in digital transformation. This is the case with LIQUID Smart Technologies, which was established to provide flexible digitalisation services to businesses and public bodies.