Professional Documents
Culture Documents
ANATOMY OF A TURNAROUND
FINANC|AL RESTBUCTURTNG Some g I O bilion in debt has been wrped olt since I gg7. Dozens ot cmpanies have ueen soff ttt oi' ilJ[:x,+*x"lJ:TI;l::':n,'"-;;"sM;i;;-J;;;;;;"
llgl]F FIRST The otd obsession.wirh marker share and sefling f-::ti9l qnd exeon records is grvrng way to a tocus on makino money with high-end producrs uu"r"o in in;or"-iirl-j;*;":""', *ll#H#:iirrllilu";:iix,#yf""xil*il, i*ffi$"$lift*nif lfr}r[',#f sf,*l:t#i::'
I t ? t I I I
Breakdown of Sales
1 999
s Corp
YANG INI
li
4 *
:i I 254 ulinii,
p.e!-s,,4
'::i,i'
iti-::+.r.:i
McNuggets ih t riji.' Rather than..trying to do'too mucli in his test kitchens, Cantalupo
may encourage
.franchisgqsawho .- ' i stealedlthe'Bi g Mac, 7.;f1.i.a. 9!9 Fge,I,vl.cl4.qfiin-ltr : ii.. be riore creativa .: '
m ..:l
45
40
35 30 25
20 15 10 0
Feb.19,'03 255
ir
256 -
Case 3-3
VP-Research: Compound A-115, a new electrolysis agent, is the one; there just isn't any doubt about it. Why, for precipitating a synergistic reaction in silver electrolysis, it has a distinct advantage over anything now on the market. 257 keti n g:
-Research
Marketing:
eti Ig:
VP-Rescarch:
arketing:
Presiden t: VP-Research:
President:
keting:
Presiden t:
ch:
That makes sense, Ralph. Apex has always lried to avoid..me too,,products, and if this one is that much better. . what tlo you think, Mrles? Well, I favor the idea olCompound B-227, the plastic oxidizer. We have some
reputation in that field; rve're already known for our plastic oxidizers. Yes, Miles' but this one isn't reaily better than the ones u,e arready have. [t belongs to the beta-prednigone group, and they.iust aren't as good as the stigones are \,Ve do"ha'e the best stigone in the field.
Just the same, Rarph, the beta-prednigones are cutting into our srigone sares. The board of directors has been giving me a gotng-Jver on thar;ne. Yes, Ralph, maybe they're not as good scientists as we are, or think rve are-but the buyers in the market seern to insist on buying beta-prednigones. How do you explain that? The betas have 60 percent of the rnarket now.
That's yourjob, not nrine, Miles. Ifwe can'r sell the best product-_and I ca. prove it rs the best, as you've seen from my data and computations_then there,s something wrong with Apex's marketing effort.
What do you say to thar. N,liles? What is the explanarion? Well, it's a very tricky fieki-the process in which these conrpounds are used is always touch-and-go; everyone is always trying something nerv. All the more reason ro pur ouretrort behind cornpound A-lr5, in the erectroiysis field. Herc rve knorv th.rt rve have a rear lechnicar breakthrough. I agree *,ith paul that tliat's our :;trengtlt.
What about that, Miles'., Why not stav out of the dogfight represented by Compound ts-227. if the plastic oxidizer market is as tricky as you say? I don't feel just right about it, paul. I understand that the erectrolysis market is pretty satisfied rvith the present products. we did a survey a.d 95 percent said they rvere satisfied rvith the Hamfield Company,s product.
.{nd only one strongly entrenched company*Hamfield? Yes, I must admit it's not like the plastic oxidizer situation_rvhere there are three strong comperitors and,bour a half-dozen who are selling off-brands. on the other hand, oxidizers are a $4r) rnillion market_tbur times as big. That's true, Miles. Furthermore our oxidizer sales represent 25 percent of our total sares. But we've been losing ground the past year. Our oxidizer sales dropped l0 percent, didn't they, Miles? While rhe total oxidizer marker was grorving, didn,t yousay? well, the electrolysis field is certainry more stabre. Total sares are holding le'el. and as I said before, Hamfield's share is pretty constant, too. what about the technicar requlremenrs in rhe erectrolysis fierd? with a realry improved producl we ought to be able . . .
Well, to tell you the trutlr, I don,t know very much about the kind of people u.ho use
it and horv they . , . you riee, it,s really a different industry. What about it, Ralph?
rng:
tl il ii
il
.ii