1. Capital, companies and creditors will be connected driving liquidity
Online market places, crowd funding and social media platforms will drive an oversupply of money into turnaround and investment opportunities. Some interesting Australian sites to check out are moneyplace.com.au and venturecrowd.com.au which link up wholesale capital and investors with credit, start up and/or property investments opportunities.
2. Significant opportunities for cost efficiencies will be created
Costs will increasingly be able to be reduced and with less upfront capital investment required. Improving technology facilitates offshoring, automation and outsourcing while companies are focusing on the links in supply chain and distribution channels to bring down expenses and gain a competitive advantage. The amount of offshoring is taking off and is moving well beyond accounting and call centre functions while expect to see more in the Philippines following the JV agreement between Telstra and San Miguel to roll out a 4G network.
3. Quickly changing the fortunes of a company will be increasingly possible
Marketing and social media technology allows you to swiftly drive revenue through finding customers who need your product. A practical example is a recent sales campaign for an air conditioner which used location based digital marketing. It advertised to users of a weather app in locations at a time when there were high daily temperatures, sales promptly heated up!
4. Value will be rapidly generated and destroyed
UBER and airbnb are well known technology disruptors which have threatened traditional industry operators. But there are lots more shaking up markets and typically they are best developed when there are established players providing an expensive or badly serviced product. Check out the following companies, Warby Parker (ecommerce spectacle provider), Wealthfront (automated wealth management advice) and Transferwise (foreign currency purchasing).
5. CIO’s will become more important as key agents of turnaround
Traditionally turnaround management has principally been the domain of the CEO, CFO, CRO and advisers. Expect CIO’s to be major players at the negotiation table.
6. Nature of professional turnaround advice will change
The modern turnaround adviser will need to be tech savvy, probably outsource/offshore financial analysis, market and work across various locations and be more connected to global capital.
7. Lastly ……. it will at least in the short term create turnaround opportunities
Expect to see lots of situations where historically a turnaround would not have been realised, but for all of the above reasons, options and outcomes not previously achievable will become entirely possible.