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Case Study

Chief Operating & Financial Officer

Staffing & Executive Placement

A staffing & executive placement firm was losing money annually on revenue of $5 million. The owner, a passive investor, hired a Chief Operating & Financial Officer to assess the company, and if determined to be viable, position it for growth and eventual sale.

Situation

Turnaround & Restructuring Initiatives

  • The company had a poor, uncooperative work environment with unhappy, unproductive employees.
     

  • There was no accounting system. All activity was managed through Excel spreadsheets.
     

  • Reporting to the investor was inaccurate, insufficient, and consistently late.
     

  • There was no industry software to manage staffing placements.
     

  • The General Manager was found to be embezzling funds, contributing to unprofitability.

  • Assessed company viability, determining that it should remain in operation and be turned around.
     

  • Installed QuickBooks and a staffing industry software package to control accounting and placements.
     

  • Developed the company’s first budget and variance reporting process.
     

  • Intentionally turned over 100% of staff in 6 months as part of the effort to create a new, productive culture.
     

  • Restructured services agreements to be more profitable.
     

  • Created positive cash flow from operations to stop monthly investor funding of operations.
     

  • Expanded the executive placement division, which had much greater profitability than general staffing.

Result

  • Over three years, sales grew from $5 million to $12 million, with positive cash flow and annual profits.
     

  • The company sold to a larger staffing company with a significant return for the investor.

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