Is Your Leadership Team Recession-Ready?

That’s the title of a short article from Tatum Group.  My first reaction to the title: it’s a little late.

But the article may be very valuable because they point out that at this stage, the signs of distress may be very subtle.  If your financial statements don’t look too bad, it may be time to look more carefully for the first signs of trouble.  Of course, it’s quite possible that you really are not in bad shape.  But if there’s ever a time to milk all possible insights from your financials, that time is now.  The article offers some warning signs:

  • Declining gross margins and/or operating margins
  • Inability to meet forecasts
  • Increasing debt
  • High turnover among employees and/or management
  • Declining market share

Then the folks at Tatum offer some valuable insight: "Early corrective action denotes strong leadership."  I’ll say!

Tatum has provided many companies with CFO services (and they do other stuff I have not bothered to delve into).  They have a strong basis for understanding financial management.  Heed their advice.