Worlds Toughest Turnaround

Regular readers of this blog know that I believe that turning around a troubled company is tough stuff. Very, very tough! Even in good times, a turnaround is tough; and in an economy like that which exists today, a true turnaround is like a 1 in 100 shot.

Now my handicapping may seem a bit extreme, but consider the rate at which creditors are preferring some form of liquidation over supporting a turnaround. The high number of liquidations would suggest that my number may not be as far out of line as at first it may seem.

But, the post is not really about general turnaround odds. I was using my opening statements to set the table for the fact that we are now watching the mother of turnarounds...that of the economy of the United States.

We have all heard the analogy of how difficult it is to quickly turnaound a battleship (i.e., a big company). Well, just imagine how difficult it is to turnaround the world's largest aircraft carrier (i.e., this country's economy), and do so in the worst weather ever experienced (i.e, a global recession).

And imagine the turnaround needs to be accomplished with the most self centered set of constituents (i.e., the House and the Senate) at the table. Many of whom are playing Russian roulette as the bigger game is played out.

It is no wonder that this turnaround isn't going well. And, make no mistake about it, this turnaround is not going well. On my Prospering in Tough Times blog, I wrote about the snowball effect back in October. Here we are , four months later, and the snowball hasn't slowed one iota. (I get no comfort that the mess might have been even worse if some things had not been done, as some would have you believe.)

Although the downturn has been a boon for Restructuring professionals,

I hope that no one in this profession is under any false delusions that continued lack of progress on stopping this slide is a good thing.

Restructuring professionals need to be doing all they can to get the word to Washington that the time has come to stop doing business as usual.

Even if Washington begins to quickly slow the snowball, we are looking at a protracted downturn. No turnaround is ever instantaneous, and this is the mother of all turnarounds. We will be witnessing many friends and relatives losing their jobs, their homes and their life savings, before this turnaround occurs.

Let there be no joy in Mudville that good times are back for the Restructuring profession. If we are part of a true profession, then the profession must do its part to let Washington know that turnarounds require swift, skilled action. And, we must also let Washington know that we need more of our elected officials to be true patriots who put the interests of the country above personal needs to grandstand for their constituents.