Lack of Strategy
Too many unrelated business lines. It’s no longer clear what your core business or strategic imperatives are. Leaders and staff lack a vision or sense of purpose to rally behind.
Shortage of Cash
Cash is tied up in many, under-performing or non-core investments, which are very difficult to spin off in the downturn without a clear exit strategy.
Complicated corporate structure
After many rapid, diverse investments, you may be left with a duplicative, fragmented, costly and complex corporate structure. Each of your subsidiary companies has become a melting pot containing disparate lines of business – from manufacturing, trading, banking, real estate, fund management – all being managed by one entity and leadership team. The business may be too big and complex to be easily managed and controlled.
Not getting the best from your talent
Your key leaders are trying to do the impossible – each holds multiple positions in many unrelated businesses. Your leaders can’t possibly have the expertise to manage the range of disparate businesses which they find themselves responsible for. You’re not getting the best from the talent you do have since your business lines are fragmented. Your structure is a barrier to effective communication and sharing of best practice and your leaders may be struggling to cope.
Lack of quality information and reporting
Since your businesses are fragmented, it’s difficult to get accurate management information – for instance for financial reporting or human resource management. Without quality information, you are not able to make informed decisions.
Inadequate systems and processes
During the period of growth, you didn’t take the time to establish effective systems and processes. Therefore business lines are operating with a lot of waste, duplication and inefficiency.
High operating costs
As a result of the inefficiency in your processes, and due to the rising costs of people and raw materials across multiple lines of business, your operating costs are high. You need to quickly get a handle on your systems and processes to drive down your operating costs.
