Thought Piece

By this time, the now shrunken in-country brand teams' and agencies' noses were well out of joint and they began reporting troubling news. What world-class gains, local relevance loses and the spectacular growth of global brands began to slow. Local product marketeers had quickly found their answer; national pride. They employed local spoken and visual languages, local humour and local lore. Where they couldn't compete in production values, they competed in entertainment value and relevance. In South Africa, people went around saying, "local is lekker", meaning local is cool. The global brands, in attempting to mean so much to so many, had developed pan-regional campaigns that blanded out the communications. Research companies, Nielson, Milward Brown and Research International were quickly deployed to understand the the thoughts and ideals of the consumers on the ground and an antidote was developed. Marketing budgets flowed back to local brand teams, new, more flexible brand guideline manuals were produced and distributed and local advertising agencies sprang to life with a new buzz word: global-local.

Banks are not charities. But they do calculate the lifetime value of the customer and they understand the reputational risk to themselves of the slash and burn exercises they are sometimes accused of.

That brings us to the role of the banks, so often the largest creditor and certainly the one with the most intimate knowledge of how a company is faring. We all love a stereotype and the heartless, faceless bank pulling the plug on sound businesses over a minor blip sits deep in the business consciousness. But not all banks fit this caricature. "We want to work with management of a business facing difficulties to help identify the issues and provide solutions to get them back on track," says a senior manager with a leading retail bank. "We can make the most impact when the problems are identified early. We are keen for management to be open with us."

Banks are not charities. But they do calculate the lifetime value of the customer and they understand the reputational risk to themselves of the slash and burn exercises they are sometimes accused of. Most solutions to business difficulties involve access to more funds and/or different products (hedging, leasing, factoring) and that all adds up to continued and profitable involvement for the bank.

A Repositioning Turnaround may mean divestment of a troublesome subsidiary. It may mean embarking on (yet another) cost-cutting exercise, including turning away revenue opportunities if they are not of a sufficiently high margin. It most certainly involves a first step of getting an impartial and pragmatic overview of what the problem actually is, from Turnaround Professionals who also know the kind of language with which to talk to banks. The moment you take this kind of decisive action, you're likely to discover that there's no crisis, no drama, only urgent action that must start now.

Peter Charles 2010