I have a friend (MTV) who was the Chief Financial Officer for two Initial Public Offerings and three "turn-around" situations.
Paraphrasing, it was MTV's opinion that the turn-arounds were "easy". They were very broken and broken in obvious ways. Fixing them was easy.
In most cases, their downward trajectory was caused by "Sacred-cows". In one case, their most prestigious customer never made a dime for them. The customer's business model was to demand services and prices that (sequentially) put their suppliers out of business. As long as there were other suppliers who craved the volume the customer has nothing to lose.
My CFO friend caused many soiled shorts when he very publicly "fired" that customer. He knew that it would take them 9 months to move their tooling* out of his company's plants. He knew that they could fill that floor-space with customers that were willing to pay viable prices.
Never-the-less, it caused near-heart attacks when MTV told their "best" customer to go pound sand. "Best", in the eyes of the Board of Directors was the customer with the greatest name recognition and the greatest market share.
MTV has a very simple flow-chart to turn-around money-losing companies.
- Stop the bleeding.
- Take inventory.
- Maximize Profit (not revenue).
- FOCUS.
The Garden Party's position on the Military follows those steps
- Dial-back operations. Our military are beating themselves to pieces.
- Step-up maintenance with a glide-path to be fully compliant with plans in four years
- Take inventory of parts needed for maintenance and to close-up the drift caused by pencil-whipping. Inventory documentation to be spot-audited and excessive deviations (of indicated inventory-to-audit) to be remedied with prejudice. Expedited purchases made to rectify shortfalls.
- Cross-train officers. Real warfare causes casualties. Officers must be trained to step into the openings, even if it is not their primary area of responsibility.
- All promotions will be based solely on demonstrated competence at tasks directly connected to operations of war: Leadership, strategy, tactics, logistics, training...
- Purge academies and brass of politically motivated USA-haters
- Every activity that does not increase the number of ass-kickers who can be deployed or increases their field-effectiveness is to be ceased
- Promises made to former military must be honored. Soldiers and Marines and Sailors do not attack machine-gun emplacements for money. They do it out of honor. Honor is the currency of the battlefield.
- All less-than-honorable discharges due to Covid will be rescinded
- Military personnel who do not "meet or exceed standard" will be separated from their service after a short grace period that will allow them one more chance to pass the standard.
*In the manufacturing world "tools" are part-specific equipment and are usually equipment that "touches" the parts (dies, molds, grippers, racks) being manufactured while capital-equipment is the equipment holding the tools (die-casting machines, robots, generic welders, fork-trucks).
Moving tools from one facility to another requires a run-ahead at premium dollars (usually weekend work) to build a buffer of parts. It takes time to uninstall the molds/dies, truck them, reinstall them and then to validate that the product conforms to specifications at the new facility.
But, but the Perfumed Princes of the Pentagon! Bureaucracy! Diversity!
ReplyDeleteI think it's mean to keep teasing us with intelligent reasonable planks on a platform that is not registered in any of the current states.
ReplyDeleteMaybe I will vote again just so I can write you in.
Or you could drive to Illinois, not register and write me in 236 times.
DeleteAlready taken care of.
Delete/JZ
Haaaaaha
DeleteI could probably do it in every state between us.
About 15 years ago I was retained by a bank and it's affiliates to work on a "turn around situation" as you described. I'd bet it was caused by the same Sacred Cow mega retailer. Unfortunately bankruptcy was the only solution due in a large part by the owner/debtor's instance that he could work it out. Your solution for the military using your friend's resolution is interesting and worth consideration, however I think it's too late economically, politically and socially for it to succeed. It's bankruptcy by default and it will be the biggest most tragic one in the history of the world. ---ken
ReplyDeleteWe are all going to end up in a grave someday. The best we can hope for is to leave the Grim Reaper bloodied, winded and regretting the day he chose to punch our ticket.
DeleteMy only criticism is I disagree with the four years to full compliance.
ReplyDeleteMy plan is two years with ninety day mileposts. Put all branches on wartime footing. Let the firings and demotions commence.
If the problem is as serious as said, and I believe it to be very serious, then even two years is too long in some cases. Kick butt like Patton.
I am very willing to listen to people with more expertise than I have. Mileposts are a great idea.
DeleteLooking at areas I'm familiar with, some can be fixed fast but others will take a while because we don't have the production equipment (or enough of it) anymore.
DeleteSome examples are: artillery shells, shipyards, and armored vehicle production/ modification.
Having said that, I'd love to be proven wrong in those areas.
Also, military contracts need to have firm deadlines with bonuses for ahead of schedule and under budget and penalties for the opposite. We need to stop never ending change orders and effectively unlimited cost plus contracts.
Sadly, it WILL take a minimum of four years... I 'know' how much has to be done on all three sides of the Navy, and I'm betting the Army and USAF are similar. Just to get all of the (insert equipment here) through rebuilt/upgrade/overdue maintenance will take 4 years.
DeleteLet's try the Elon solution. Fire 90% of the Fed gov and see anybody notices a difference.
DeleteI am reminded of a '90's WSJ article that analyzed a census questionare that evaluated workers day in 15 min blocks. They found that in comparison to private employees State/County/Local government employees worked 4Weeks less a year! No, not vacation, but starting a little later, longer breaks, cigarettes, wasting time on the internet . . . FOUR weeks less every year.
Don't worry, the Feds are different. FIVE weeks less work per year than private sector employees.
ERJ, I know you listen to others. Indeed, I think one reason you post the planks of the Garden Party is to gather ideas from your audience.
DeleteAs an employer, even when going it alone, I usually set mileposts.
OldNFO, with great respect, you may well know therefore terrific insight. Yet, correct me as needed, your knowledge base is within the miasma of the current policies.
Where I said 'wartime footing' I meant to exterminate the sluggish status quo from the top down. Harken to how in short time America in WWII with resolve, went from a peacetime nation in serious deficit to a global leader in production of goods and services.
Sure, that was eighty yrs ago. But I happen to believe if it happened before, it can happen again.
All that is needed is scrapping the deadweight and the people filled with resolve. ERJ is he who can and will lead us to victory. Thank you and goodnight.
Joe, for that type of planning to work there must be real fear, not just that it might rain on Saturday and cancel the golf tournament, but that if things will be so bad my life will be forever altered. Consider the Pentagon eunuchs with rich pensions and "consultant" positions after retirement. As it stands they will do nothing to to upset that best customer. Only when they hear the sound of muskets will they leave their comfortable ways to try and save their life. In peace you have Kimmel and Short, in war you need Nimitz and Halsey.
ReplyDeleteGood list! I wonder if he can do pubs?
ReplyDeleteWhen you have more admirals than ships and more brigaders than brigades, the problem is a top heavy bureaucracy. The civilian part of the DOD mirrors the military side. What is the Garden Party's plan for this issue?
ReplyDeleteI agree with those!!!
ReplyDeleteOkay! So when and where is the Garden Party organizing meeting? You keep enticing us like the wicked witch with candy.
ReplyDeleteChuck Grassley (R) spent 30 years of his career trying to get the military to account for their waste and spending. He admitted he failed. Good luck to you.
ReplyDeleteI see no provision for fixing the veterans complaints about health care, etc.
Grassely worked in the existing paradigm. The failure of his efforts were predictable.
DeleteWe can agree that a thing can be so broken that repair is right out. Replacement is the only viable option. Yes, it will be expensive (let me count the ways) but necessary because failure has been allowed to come this far.
the Defense Department remains the only federal agency in the U.S. that has been unable to pass an independent audit, despite the fact that the Pentagon gobbles up more than half of the nation's discretionary budget and controls assets in excess of $3.1 trillion, or roughly 78% of the entire federal government.
ReplyDeleteWTF! 78%