Distressed Investing + Leadership

January 25, 2011

Wednesday, I am leaving for the Distressed Investing Conference of the Turnaround Management Association and am eager to see whether presenters spend much time discussing  leadership considerations.

Many investments in distressed companies  fail because the investors (most of them private equity firms) pay too little attention to selecting and managing company leadership, but the last time I attended this conference, 2009, there was only one session (really, it was only one panelist) who highlighted this very important issue.

Mike Heisley discussed the fact that distressed companies require a leader with traits that are very different from those required to lead  a “healthy” company.  He was exactly right.  Click here to view my post from that event.

2 Responses to “Distressed Investing + Leadership”

  1. February 1, 2011

    To Renee’s point re Kiosks: A former colleague of mine was, for a time, CFO of a well known retailer; one who books “90%” of their revenues from temporary mall kiosks across the US during the holiday season. I am sure the logistics are demanding, but think of the overhead the organization does NOT have to cover.
    Next, towards Renee’s second example, the hardware store: I may have missed her saying so, but a strong point in favor of the example store’s smaller layout and reduced sku mix is that it fosters a useful “Lets find what you need” response from knowledgeable employees. This puts the employees in a position to keep close tabs on skus based on face-to-face customer contact; this makes it easier for the store to look skus in terms of real customers, price points and operating margins.

  2. February 1, 2011

    Correction: Lets try changing the penultimate line of my comment to “…easier for the store to look AT skus….”

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