Early in his career, Jim Sargeant worked for a national accounting firm, responsible for setting up management consulting work. When clients called, Sargeant would send whichever consultant had spare time. That's when he noticed something interesting: if he sent a human resources consultant to analyze the situation, that person would come back having found an HR problem. If Sargeant sent an engineer, inevitably, the consultant would find engineering faults.
"We tend to solve the problems we have the expertise to solve," Sargeant deduced. "So I broadened my experience from technical disciplines to all disciplines to be able to do turnaround consulting."
Since then, Venice-based Sargeant has gone on to help more than 100 companies from California to Puerto Rico "turn around" from failure to success. And over the course of his 43-year career, he has solidified 10 fundamental reasons why businesses fail, and detailed them in his book, Last Rites or Turnaround.
"A lot of companies spend money, time and resources to solve their problems, but if you miss the fundamental problems, it's all for nothing," says Sargeant.
The first fundamental on his list is lack of leadership. He cites the example of a company that spent large amounts of money conducting studies to get to the bottom of its severe cash flow and financial planning problems. After some questioning, the CEO admitted to Sargeant that he just was not a leader; as a result, no studies were ever followed up and employees never received any guidance on how to deal with the studies' results.
"Without guidance, companies can't succeed," Sargeant says; hence, reason number one for why businesses fail in his book is: "Where's the Leader?"
Other common reasons Sargeant lists include incompetent presidents, frozen management, crooks and liars, dueling partners who deadlock their companies in decisions, and the "cancerous" co-worker who brings down office morale with constant complaining and gossiping. Managing by committee is a problem that Sargeant sees in family-owned companies where the principals often start the day eating breakfast together and there are no clear-cut lines of responsibility. Sargeant has also counseled business owners who treat company funds as their own personal piggy bank, and then have to take out loans to pay for things such as employee insurance premiums.
In his book, Sargeant gives examples of solutions he has found for companies during his decades as "the turnaround man." One, Columbus Show Case Company, became a national runner up for Inc. Magazine's Turnaround Entrepreneur of the year. Locally, he's helped many small and medium-sized businesses, including a software firm and a furniture company.
Sargeant began his practice in Cincinnati and then opened one in Venice in 1986, dividing his week between the two regions. In 1998, he retired and went on a sailing trip with his wife Joyce for six months around the eastern United States. But once back home, he was soon bored, and picked up the consulting reins again. Now, the bulk of his clients are banks and commercial lenders for whom Sargeant helps identify troubled businesses.
Sargeant's book, Last Rites or Turnaround, is $19.95 and is available online and at bookstores. For more information, visit www.jimsargeant.com or call (800) 431-1579.