Gap management turned into crisis management

A group of companies operating in Central Europe wanted to integrate two Hungarian industrial companies into the group.

The background

The common CFO of the two companies to be integrated, who was also the Head of Back Office Operations, resigned and his replacement was expected to take a longer period. The original task was labelled as ‘gap management’, to ensure that the tasks were carried out until a new, permanent CFO was found.

The complications

The new owners had planned a long-term partnership with the former owners of one of the companies to be integrated, but the internal tensions jeopardised this effort. The sudden increase in staff turnover raised new issues that needed to be addressed immediately.

The other company to be integrated was more concerned about the lack of regulation of processes, also due to increased staff turnover and the burden of repaying a bank loan.

Even during the finalisation of the tasks, it became clear that all these problems were compounded by the difficulties associated with an ERP system that had not been properly implemented.

The crisis

The unexpected set of problems, the departure of managers and professionals, and the misjudgement of the situation resulted in a complex challenge. Interim Ltd. suddenly faced a complex project management task instead of a relatively simple gap management process in a disintegrating, demotivated organisation.

In the meantime, there were also changes at higher levels: the joint managing director of the two companies to be integrated resigned. Subsequently, the managers in charge of the holding company and the two Hungarian companies also left, and their positions were only filled again after a few months.

The result of the assessment

For this assignment, we worked with an interim manager who, in addition to his professional experience and preparation, could successfully stabilise the personnel and staff situation with his positive and constructive leadership attitude. The unacceptable ERP situation also had to be remedied in the short term.

Solution, consequences

With the help of our ‘overqualified’ interim manager, in a very short time:

• the organisation has stabilised, staff motivation has increased, and new staff have settled in well,
• the financial administration tasks have been clarified and a new controlling and reporting system has been put in place,
• the ERP system has been restructured, which has led to an improvement in the quality and timeliness of information for management decisions,
• the financial situation was stabilised, and the outstanding receivables has been reduced.

Due to the last-minute tasks related to the ERP system implementation and the tight timeline, it was not possible to fully hand over this task to the new permanent CFO within the project timeframe, but the Interim Ltd. and the interim manager were available to answer questions after the end of the project.

The integration was successful, and the crisis was resolved.