Business recovery special: recovery positions

Organisation and communication are key in business recovery, and
it’s more than just making redundancies

Jo Wright has spent the whole of her career in business recovery but
still gets a buzz from her job. The variety of tasks and situations – from
trying to save struggling businesses to working across industry sectors – stops
things getting stale.

‘It’s an exciting job,’ says Wright, business restructuring partner at BDO
Stoy Hayward.

After a spate of high-profile corporate collapses, ranging from Woolworths to
Lehman Brothers, the business recovery sector has a higher profile than ever in
the business world.

Within firms, staff are being transferred to business recovery to meet
growing demand from clients. But many people outside the profession wrongly
think her job mainly involves making people redundant, according to Wright, who
leads BDO’s restructuring department for the Midlands.

‘[Making people redundant at a client] is only a small part of my job,’ she
says. ‘Every project is different and every company you deal with is different,
with its own dynamic. You are always being challenged.’

Wright began her career in accountancy in 1989 when she joined the business
recovery department of what was then Stoy Hayward. At the time, many businesses
were struggling to pay debts due to a sharp rise in interest rates.

Wright recalls a ‘rapid learning’ curve and lots of practical experience in
helping struggling companies.

Business recovery specialists need a broad base of business skills –
corporate finance, restructuring and financial analysis.

‘You need lots of organisational and communication skills because you are
juggling lots of balls in the air at the same time,’ Wright says.

The ability to keep calm in a crisis also helps. Clients whose business is on
the brink of collapse are understandably emotional.

‘When you are trying to a sell a business you are often operating in a very
short window of time,’ Wright says. ‘You have to detach yourself emotionally,
although I think this comes from experience.’

Often, clients are in denial about the mounting problems facing their
business. Business recovery specialists have to persuade clients to acknowledge
that their business is in serious trouble and take action to save it.

‘Sometimes people have their head in the sand,’ Wright says. ‘There are
situations where people have taken too long to seek advice. At the moment, a key
problem is cashflow. It’s a very old fashioned statement, but I keep reminding
people that “cash is king”.’

She adds: ‘No matter how positive the profit forecasts are for a year ahead,
if you can’t pay your bills at the end of the month, you are in trouble.’

Business recovery specialists can help clients plan for different scenarios,
such as what happens if a business doesn’t get a major contract as expected.
‘There should be a plan B,’ Wright says.

Dealing with clients’ credit providers is another important part of the job.
This means dealing with a range of lenders, from high street banks to a
factoring companies that buy and sell debts.

‘A business recovery specialist should help bring them all together, and get
them working together,’ Wright says.

It all sounds very hectic. How does Wright unwind after work? She is clearly
something of an adrenaline junkie. Her hobbies include skiing, cycling, and
doing ‘the odd crazy thing for charity’ (like abseiling off Guys Hospital tower
in London).

Variety is the spice of life – be it Dodgy electrics, flaky business
plans or vermin-infested kitchens

Geoff Carton-Kelly, head of the London restructuring and recovery
practice at Baker Tilly, has seen it all during an eventful career in business
recovery.

He got into business recovery by chance, in the early 1980s. ‘Like a number
of people, I sort of fell into it,’ he says.

‘I tried to get a book-keeping job after leaving school and managed to find
my way into what was Stoy Hayward in those days.’

Kelly got talking with someone who knew that the firm was recruiting for
their insolvency department and needed people to do a provisional liquidation.

Leading a liquidation was very exciting and fast-moving, knowing in many
circumstances that he was ‘acting with the power of the court behind you’, Kelly
says.

Kelly cut his teeth during the recession of the early 1980s. It was a period
of high unemployment, rising business failures, and social unrest.

He spent a lot of his early career dealing with hotels that had seen better
days.
‘I had some fairly nasty hotel cases,’

he recalls. ‘They had been neglected, with water dripping down the walls and

infestations of all sorts in the kitchens. Some hotels were wired using
telephone wire. Very odd stuff.’

This experience, combined with work in industries ranging from IT and the
motor trade to energy and retail, has given him a healthy cynicism and an
enviable CV.

‘You are going into a profession that has the widest variety of activity that
you could imagine,’ he says.

‘It’s not just providing professional advice. It’s about exercising
commercial judgement and using your nous and being prepared to not take no for
an answer and investigate historical matters. It’s also about being prepared to
take calculated risks,’ he says
During his early career, training was mainly through learning on the job. Kelly
gained his insolvency licence in 1993 and joined Baker Tilly in 1998.

What does he enjoy most about the job?

‘The things that most people enjoy are the sheer variety of things you have
to deal with,’ he says. ‘It is not only the different types of business you get
to look at but also the individuals involved.’

The work is tough but rewarding, requiring people to work quickly and calmly
under pressure.

‘You are dealing with very complex and difficult scenarios at speed,’ Kelly
says. ‘[To do this] while maintaining your professionalism is a challenge.’

Insolvency specialists are busy people now as the number of failing
businesses soars.

Does the current recession feel any different?

Kelly says one big difference is that banks and the taxman are giving
businesses more breathing space this time round. He has reservations about this
strategy, however.

‘People are being given a lot of opportunity to get themselves refinanced and

get themselves sorted out and restructured,’ he says. ‘But I personally feel
that it is
storing up a lot of issues that are not going away and, at some point, are going
to have to be dealt with.’