With broad experience as a financial director, a European controller, an SAP project leader and a project coach, I knew what reporting was and how much energy reporting takes. But above all, I learned its importance in the context of general management and strategy.
When I started this reporting mission in January 2006, this group had no reliable reports at all. Every department made its own very creative and extensive excel sheets in which they invested a lot of work every month. The reports came months too late and were not in accordance with the main system, they were not consistent, etc. Accompanied with some confusing explanations, it landed, on the desk of the CEO, who had to pass his weekends puzzling out the figures, and making an estimation of the position his companies were in. It‘s not amazing that some wrong decisions had been made in the past, which caused a tough financial situation.
Till then the group was kept alive by the endless energy of the CEO and his wife, and the very good contact they both had with the collaborators. As a result, this created a dangerous situation not only for the health of these leading people, but also for their shareholders and the banks.
At the very beginning of my mission, the company got a visit from the financial institutions. I was then invited to see "where to position the reporting". Some of the existing unreliable reports were handed over. Unfortunately, the consequences were disastrous. The banks left, announcing the withdrawal of all credit limits from the next week on. Here my mission changed from "reporting" into "help". For more than a week I had to deploy all my diplomacy to bring the banks back around the table, but in the end it worked. Then, we came up with a shortlist of measures.
One month later a credit extension was admitted in order to pay the holiday wages, however on the condition of committing myself to deliver a business plan for all the departments within three months. The business plan was made in close cooperation with the CEO and his collaborators; it showed what everyone already knew but no one had ever put on paper: namely the potentials this group had. It also described which strategy to follow and which hard decisions to take.
During the same period I somehow managed to develop a streamlined reporting system that answered to the normal calculation ratios and which was able to compare budgets with the real situation. Also an automated consolidation was included. Separately from the probable decision of the financial institutions, a lot of measures were already carried through in this period.
After presenting the business plan the banks started to think along with us. Two months later a new credit extension of 2 million euros was consented. Based on this, I could convince the credit-insurance companies to extend their limits towards the suppliers. Finally we could go to the social security and the VAT administrations in order to obtain a financial plan and stop the endless penalties.
Twelve months later we presented a second investment plan to the banks and again they agreed. At the same time I introduced my successor CFO in a group of companies that were as good as completely recovered from a very hard illness. So my mission ended with the feeling that it had been a very hard period but with splendid results: to re-establish the confidence between banks and the company, thus helping to save the future of this group and its 250 employees.
