Special Topic: RestructuringSonderthema Restrukturierung
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Special Topic: Restructuring

Intelligent restructuring means much more than cost reduction

Corporate crises are often triggered by “current external events”, which can lead to colossal problems within the company. These triggers, however, are seldom the actual cause. In addition to direct containment of the crisis, which boils down to liquidity protection, the task of corporate restructuring mainly comprises the sustainable elimination of the crisis causes and the restoration of competitiveness, both of which are generally achieved by a correction of the company’s strategic alignment.

Every crisis opens the door to new opportunities!

Truly professional restructuring offers not only a speedy way of overcoming the crisis, but also a way of emerging from it with even greater strength. 

Our restructuring concept for successful crisis handling and the generation of new growth comprises two modules:


Module 1:  Liquidity Protection / Business Review / Turnaround Master Plan


Module 2:  Restructuring / Revitalisation

Restructuring Concept

Module 1: Liquidity Protection / Business Review / Turnaround Master Plan


1.1. Liquidity Protection

  • Analyse liquidity situation
    The company’s financial requirements are ascertained by way of monthly or weekly liquidity planning. Our planning tool ensures constantly-updated, 360-degree transparency of the current and future liquidity situation and indicates the development any possible financial straits.
  • Use of cash reserves
    - Analysis and use of existing cash reserves
    - Accounts receivable management
    - Stocks optimisation
    - Disinvestment of non-operative assets

    These are just a few of the ways in which the company can generate its own short-term liquidity.


1.2. Business Review

Structured analysis of the current corporate situation, e.g.:

  • Product portfolio, value drivers / value destroyers

  • Competitive position
    - Market development
    - Competitors
    - Relative market position
    - Key competences
    - Customer structure

  • Cost structure / cost-reduction potentials

  • Organisation
    - Value-added process
    - Structures
  • Financing
    - Financing structure
    - Relation to creditors
    - Balance sheet structure

  • Plausibility check of business planning

  • Company management

  • Management and control system

  • Competence

  • Corporate culture

  • Employee motivation

  • Risk assessment

Our Business Review provides a structured overview of the dimensions of the pending problems and indicates their causes.

1.3. Turnaround Master Plan


The immediate liquidity protection actions initiated by us, together with the results of the Business Review, form the backbone of a Turnaround Master Plan, which quantifies and summarises all the major cornerstones required for successful crisis handling, along with a strict time scale.




Module 2: Restructuring / Revitalisation

A swift handling of the crisis relies on a high degree of professionalism in the operative implementation of the necessary redevelopment action. The experts at KM results apply their experience, which is absolutely vital here, either by providing assistance to the company management, or by functioning as an interim manager, such as in the capacity of „Chief Restructuring Officer“ (CRO).
In each case we ensure the ongoing control of success with a constant redevelopment monitoring. This central control tool provides the highest degree of transparency of the progress and success of the redevelopment measures for all those involved, enabling impartial, objective reporting on the state of affairs at any given time for the Supervisory Board or creditors’ representatives.



2.1. Restructuring

We believe restructuring to extend beyond pure cost-reduction, incorporating the aspect of revitalisation
Restructuring involves all parts of the company and is aimed at not only ensuring the short-term survival of the company, but also setting the course for its long-term success. A sustainable strengthening of the company’s competitive position generally requires strategic realignment.
In this way - our way - the restructuring and revitalisation processes are no consecutive processes. Instead, the two processes go hand-in-hand to transform the opportunities - created by the crisis - into competitive advantages and ultimately into long-term, healthy growth.

Generation of Liquidity Creates Room for Manoeuvre

The consistent generation of liquidity is, above all, aimed at direct crisis containment and at the heart of the activities. Our restructuring launch programme includes the following standard items:

  • Systematic planning and comprehensive monitoring of all received monies and payments made
  • Consistent accounts receivable management
  • Re-evaluation of all scheduled investments under consideration of liquidity and pay-back aspects
  • Reduction of stocks
  • Reduction of material costs by way of active purchasing optimisation
  • The use of all opportunities to optimise the financing structure, in particular with regard to terms
  • Examination of disinvestment options for non-operative assets

Cost-Reductions must be Effective in the Short-Term
Cost-reducing measures with short-term effectiveness are primarily required in the case of a drop in turnover, with all cost-types - without exception - under scrutiny.

It is in times of crisis, in particular, that the savings leeway for both internal and external expenditure is exercised far more than during „the good times”. Often unavoidable personnel release measures within the core workforce are „the last resort“, with each individual case requiring careful examination for possible negative post-crisis effects (a loss of expertise and experience). It should be borne in mind that the achievable cost reductions do not usually become effective in the short-term and are mostly coupled with a negative liquidity effect (social plans, redundancy pay-offs).

We summarise all cost-saving potentials and options in a stage-by-stage plan, drawn up in accordance with clear, company-specific criteria (e.g. the term until effective, necessity for the company survival, influence on the company’s competitiveness etc.) and annotate these with fixed decision points on the time axis, according to the development progress.



2.2. Revitalisation

Using the Opportunities Uncovered by the Crisis

It is in times of economic recession, in particular, that intelligent restructuring offers the opportunity to considerably improve one's own market position. Competitors disappear from the market and the market share is reallocated. The chances of profiting from this situation – using the right measures – are particularly good.

We examine business area and product portfolios in terms of the criteria profitability, mid and long-term development opportunities and necessary restructuring costs, with the proviso: „invest in the strong, disinvest on the weak“.

Strengths can thus be bundled and selected strategic aims focussed upon, in order to, e.g. tap new customer groups with targeted marketing and sales promotions or speed up promising product innovations by focusing on R&D capacities.

While production lines are not running at full capacity we can use the time to optimise the production process, to optimise the depth of added value or for specific investments aimed at increasing flexibility or decreasing lead times.

Concentrating on the company’s strengths allows more room for manoeuvre, the realisation of which is often made easier, and perhaps even for the first time made possible, by the very existence of the crisis.

Decisive action and professional assistance form the basis for a healthy future!