Turnaround Consultant vs Turnaround Manager: What to Hire
A turnaround consultant diagnoses the business and writes the plan. A turnaround manager takes the wheel: cash first, then cost, then commercial recovery, with the authority to make the decisions the plan requires in the weeks they still matter.
When a consultant is enough
When the management team is capable and trusted, the board simply needs an independent view of the options, and the lenders want a plan they can rely on. In that case the internal team executes and the consultant validates.
When you need a manager
- Lenders or investors have lost confidence in the current management
- Cash visibility is weak and nobody owns the forecast personally
- The decisions required will be unpopular inside the company
- The chief executive is part of the problem or has already left
- There is less than two quarters of runway
What good looks like at ninety days
Cash is forecast weekly and the forecast holds. The loss making activity has stopped or has a dated closure plan. The management team is smaller and clearer. The lenders have received one set of numbers that has not been revised twice.
What a turnaround consultant delivers, week by week
- Weeks 1 to 2: independent diagnostic, real margin by product and customer, real cash position, and a first view of covenant or funding risk
- Weeks 3 to 4: options paper for the board, ranked by cash impact and execution risk, with a recommended path
- Weeks 5 to 8: a written restructuring or recovery plan with named actions, owners, and dates, ready for lenders or the board to approve
- Weeks 9 onward: if retained through implementation, periodic reviews against the plan; if the mandate ends at the plan, a formal handover to whoever executes it
Turnaround consultant, turnaround manager, interim CEO, or restructuring adviser
How turnaround consultants are paid
How to select a turnaround consultant
- Ask for two or three situations of comparable size and sector, and speak to the client or the lender directly, not only the reference the consultant chooses
- Ask what specifically changed in cash, cost, or the plan within the first 30 days of a past mandate, not just the eventual outcome
- Ask whether they have held executive authority themselves, since a plan written by someone who has never had to implement one under pressure reads differently
- Ask for the draft engagement letter before committing, and check the scope, the fee structure, and the exit terms are specific, not general
- Ask how they propose to work with the existing management team, since a plan the team will not own rarely survives contact with the business
https://niklaslindahl.com/guides/turnaround-consultant