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Reviews of Business Turnaround and Profit Improvement Consultants

When a business is struggling, it can be tempting to bring in an outside consultant to try to turn things around. But not all consultants are created equal, so it’s important to do your research before hiring one. Here’s an overview of reviews and experiences with some of the top business turnaround and profit improvement consulting firms, to help you make an informed decision if you’re considering bringing one on board.

AlixPartners

AlixPartners is one of the largest and most well-known turnaround consulting firms. They’ve worked with high-profile clients like GM, Kodak, and Blockbuster. Reviews are mixed – some CEOs swear by them, while others feel their fees were exorbitant for the results delivered.

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On the positive side, clients say AlixPartners utilizes a hands-on approach to rapidly reduce costs and improve cash flow. For example, they might renegotiate contracts, slash overhead expenses, or right-size staffing levels. This emergency room-style restructuring can help stop the bleeding and stabilize things in the short-term.

However, some clients argue the drastic cuts often don’t lead to long-term success. And the consultants can be very expensive, charging millions in fees over the course of an engagement. As this CEO describes, they parachute in with little knowledge of the industry or company culture, dictate changes, collect big fees, and then move on to the next client, leaving others to deal with the aftermath.

So AlixPartners may be a good fit for a rapid triage situation, but their slash-and-burn methods aren’t suited for every turnaround case.

FTI Consulting

FTI is another large, publicly-traded consulting firm that offers turnaround services in addition to other advisory services. Their approach is more specialized than Alix – they have practices dedicated to specific industries and situations like healthcare restructuring, retail turnarounds, and mergers & acquisitions.

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Reviews of FTI praise their strategic thinking and operational improvement capabilities. For example, this testimonial from a financial services client describes how FTI helped design and implement enhanced risk management and compliance processes. Their expertise with bankruptcy proceedings is also noted as a plus.

However, some clients complain of poor communication and feeling “nickeled and dimed” by FTI’s large team of consultants. And while their industry expertise is valued, they may not be a budget-friendly option for smaller companies compared to boutique firms.

Alvarez & Marsal

A&M is another major player, focused on turnaround management, performance improvement, and restructuring services. They’re known for their work in the healthcare space, like leading the turnaround of St. Vincent’s Catholic Medical Centers in New York.

In general, reviews are positive – clients appreciate A&M’s combination of strategic vision and hands-on implementation. As this testimonial mentions, they’re able to balance short-term performance improvements with long-term growth planning. Their operational restructuring expertise helps drive cost savings as well.

Downsides mentioned include communication challenges with large engagement teams. And as a huge firm, they may not be able to provide the close personalized attention that a smaller boutique could offer. But overall they have a solid reputation.

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McKinsey & Company

While not exclusively a turnaround consultant, McKinsey’s well-known for its strategic consulting services. They’ve worked with many major companies on performance transformations, cost-cutting, and recovery strategies.

Reviews are decidedly mixed. Some rave about McKinsey’s strategic brilliance and intellectual horsepower. Their pedigree, credentials, and high profile clientele often impress executives. But others argue the advice is often too theoretical and the consultants lack pragmatism.

Fees at McKinsey are sky-high, regularly running into the millions for months-long engagements. For cash-strapped companies, it’s a valid question whether the strategic analysis is worth the premium price tag compared to more affordable options.

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Boutique Turnaround Firms

In addition to the large, well-known consulting firms, there are many smaller boutique turnaround and restructuring consultancies. This can be a good option for mid-market companies who still want experienced specialists but don’t require hundreds of consultants on site.

Some of the better reviewed boutique firms include Carl Marks Advisors, Getzler Henrich & Associates, Focus Management Group, and Riveron. What they lack in brand name prestige they often make up for with greater flexibility, responsiveness, and partner-level attention. Their fees are usually (though not always) more affordable as well.

The downside is boutiques may not have as many resources and as broad expertise as the major firms. There is also more variability in quality from one boutique to the next. But for many companies, the tradeoffs are worth it for a more customized and budget-friendly experience.

Making the Decision

Turnaround consulting engagements are major investments, so it’s important to do your diligence. Clearly define the scope and objectives, get proposals from several firms, ask for references, and evaluate cultural fit. Be wary of firms that promise miracles – sustainable change usually requires an ongoing commitment, not just a silver bullet prescription.

And remember – the consultants are there to advise you, not run the company. So make sure your own management team is committed to driving change, and that systems are in place to sustain improvements over the long haul.

With the right consultant and an engaged leadership team, a turnaround is possible. But there are no guarantees – hiring a consulting firm alone won’t magically save a struggling business. Do your homework to make the best possible decision and set your company up for success.

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