Posted: 21 May, 2021
On 19th May TMA hosted a webinar in partnership with RSM where Graham Bushby and Tyrone Courtman from RSM Restructuring Advisory LLP explored an alternative turnaround growth strategy. Tyrone talked about the importance of ’being different’ and some of the attributes that may afford an explanation as to why some individuals and organisations are more successful than others.
Graham and Tyrone were joined by Fraser Dick, Managing Director of SME business, Perfection Alloys Limited, who shared his own personal experience, illustrating the importance of ‘being different’ and the impact it had in effecting his own businesses turnaround.
We hope you found this webinar as interesting as we did. Below we summarise some of the key discussion points but if you would like to watch the recording you can do so here.
The importance of being different
As a Partner at RSM, Tyrone’s experience lies in advising underperforming or financially stressed and distressed businesses, their owners and lenders. He began his talk by looking at three strategies for business growth: following the leader, leapfrogging the leader and being different. Unlike the first two strategies, being different means that a business can chart its own path, make its own rules and set aside the status quo. But to be different, Tyrone says that you need to think differently too. Taking Apple as an example, he talked about how the company set out to be different from the start and in doing so is seen as a pioneer rather than ‘just another computer company’. Apple is different because it thinks differently, and it thinks differently because it starts with ‘why’.
The importance of thinking differently is something that Simon Sinek, the British American inspirational speaker and author of ‘Start with Why’ is very good at explaining. ‘Start with Why’ says there are only two ways to influence human behaviour: manipulation or inspiration. Sinek says that what all the great and inspiring leaders have in common is that they think and act from the inside out, rather than the outside in. Most of us say what we do, say how what we do is better and expect to achieve success. But Sinek says that the goal is not to sell to people who want what you have, the goal is to sell to people who believe in what you believe.
Using the example of the Wright Brothers, Tyrone said this is the same with hiring employees. With no money, no contacts, no college education and no one rooting for them they succeeded where others with unlimited resources did not. The Wright Brothers were driven by a purpose and belief that if they unlocked the key to flight it would change the world. The people who worked with the Wright Brothers worked with them for that belief, not for money or fame.
The key message Tyrone wanted to get across is that people don’t buy what you do, they buy why you do it.
Finishing his talk, Tyrone shared his own ‘why’ saying that as a boy, his family depended on his father’s job which was seasonal and there was always an undertone of financial insecurity. Now, in his professional life,
Tyrone does what he does to bring his clients the peace of financial security so they can sleep at night.
A business owner’s perspective
Having talked about the importance of being different, Tyrone handed over to Fraser Dick to share his business turnaround experience and the impact that ‘being different’ has had on his business.
Now the Managing Director of Perfection Alloys Ltd, Fraser started out in the company as a van driver before having an idea that became instrumental to the business’s rapid growth. Within five years of Fraser joining, the business went from doing 20-30 wheels a week to having 55 staff servicing 1200 wheels a week alongside providing an array of other services.
But the business’s rapid growth came at a price. While turnover was high, they had no real infrastructure and the in-house bookkeepers weren’t able to keep up. HMRC arrived at their office with a closure notice. After negotiating a payment plan to stave off closure, the company hired a trained accountant and the business continued to grow. Two years after HMRC turned up the business was turning over £2 million per year but were struck again when the trained accountant neglected to pay HMRC and to cover up the mistake negotiated a repayment plan without the Directors’ knowledge. With a poorly planned repayment schedule Christmas arrived and with no money to pay Christmas wages Fraser and his partner took out personal loans to pay staff. In January, an Insolvency Practitioner told them they had to wind up the company.
Taking two weeks to digest the situation, by chance, Fraser’s business partner was given Tyrone’s card as someone who might be able to help save their company. Calling Tyrone was the company’s turning point and after an assessment of the business Tyrone told them he thought the business was viable and that he could help them to save the company. Convincing the Court they were worth keeping open, the company entered into a CVA which it was able to exit after three years. During this time Fraser took financial control of the business and ensured that every expense from new plant to a box of staples passed his desk. Now, the company is smaller with only 35 staff but is much stronger and more profitable with profits increasing year on year.
As a company, Fraser said that doing things differently is something Perfection Alloys has embraced. During their turnaround Fraser said that it was their belief in what they do that meant they were able to retain the
confidence of their staff and creditors. Going against Tyrone’s advice, they did not drop staff salaries but instead dropped their own salaries as directors and every decision they made was discussed with management and communicated to staff. Now that the business is back on track, Fraser continues to communicate regularly with staff and says they have a culture where anyone can pick up the phone to speak to him as the Managing Director. Fraser said he is certain that it is their belief in what they do that allowed the business to survive and thrive.
Tyrone too said that the right leadership, as Fraser and his partner demonstrated, is critical in a turnaround. Whatever the situation, he said that people need to lead from the front and need to have a vision and belief in what they’re doing. If you don’t believe in what you do how can you convince someone else to do it?
Thank you to RSM, Graham, Tyrone and Fraser for their time and insights into the importance of being and thinking differently. We hope you found this session useful and that you will join our next webinar in partnership with Colliers on 17th June. Registration details will be released soon.
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