Interim Finance Director Launches MBO

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Responding to the challenge

At the age of 53 I was made redundant, along with all of my fellow directors, when the company we worked for was taken over by a much larger rival.

Looking for a complete change, the idea of Interim Management with the variety this offered was very attractive. So I canvassed Interim agencies and one of these was impressed enough with my experience to give me my first assignment. Getting the first one is the most difficult as most agencies use tried and trusted candidates. Nearly six years later, I am still at it; with no regrets, it is varied, interesting, profitable and the flexibility of assignments mean that I enjoy a wider social life.

A Difficult Assignment

My third assignment promised to be a walk in the park after two gruelling disaster rescue jobs. The brief as Interim FD was to hold the fort as the FD had resigned and they did not want to replace until a new Divisional structure had been finalised. The company was a subsidiary of a very large International Group and had a break-even forecast for that year. It was up to me they explained to keep a lid on things so that this forecast did not go south in the final 4 months of the year.

I had a ten day handover which is a long time by normal interim standards so all looked set for a stress free few months.

Six days into the job having looked at factory loads, WIP, ongoing contracts and the forward order book I picked up the phone and told the Divisional MD that my most optimistic forecast for the year was something well in excess of £3m loss! After the initial reaction of Disbelief, I was obviously new to the company and the industry, the usual pattern of fear, recrimination and anger with the overriding determination of all concerned to prove 'it was not my fault.' A month later when the situation was undeniable they offered me the MD position which I accepted with some trepidation.

The next six months were rather fraught but the management responded really well to the challenge and readily accepted some of the Draconian measures I was forced to introduce to first stabilise and then turn around the situation. We could not unravel the past and closed the year with a £3.5m loss but by the end of the first quarter the company was small but very welcome profits.

The Unexpected

Out of the blue one morning the Divisional MD rang me and said that he had finished his reorganisation and we were not core to his business and did I want to do an MBO. After some heavy negotiation and ten months after I walked into the business as Interim FD I became Chairman and part owner of the company.

Seeing the Light

For the first time in my career I was operating outside a major Group environment and the freedom that that engendered was exhilarating. We eliminated dozens of reports, reduced the volume of meetings by half and management started to manage in an atmosphere free of fear and politics.

After two years and realising that significant capital was required to take the business forward we decided to sell to another Plc. My partners stayed on but I decided that I did not want to return to the Corporate treadmill and missed the variety that Interim work offered and so returned to that line of work. If I had known the problems of the next assignment I may have had second thoughts but that's another story.

John Craven

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