In times of economic downfall you can’t open a newspaper or magazine without reading heads about restructuring plans, rising unemployment and bankruptcies. Now I found an article in ‘Netto’ about a company called Nyrstar which has changed for the better thanks to the crisis.The recent acquisition of a mine complex in Tennessee, America, illustrates the adjusted strategy of Nyrstar. A vertical integration has to make the Belgian-Australian zinc melter less dependent of its raw materials suppliers and the economic cycle.
Since last summer there has been a nice cash position on the balance sheet which can help to achieve this ambition. This good cash position is mainly due to the issue of convertible bonds with a total value of 120 million Euros.
Because the crisis is not definitely passed, the company keeps focussing on a structural saving of its costs.
The restarting of the pro
duction in Balen stimulates the confidence in Nyrstar. The temporary break in the production here, and at other places, probably weren't as bad as they look at first sight. During the past months the company managed, next to a big overhaul to work at a comprehensive restructuring, to make the site more flexible and dynamical. From now on the production will be better able to react on the demand, not only from the final consumers but also from the other branches. Such initiatives elevate the efficiency of Nyrstar.I think it’s quit admirable that a company has the courage to take drastic decisions to reorganize its business structure in a way that the business is profitable again during times of economic downfall. There is often discussion about the fees for managers, but just like in the case of Nyrstar there are many other examples of higher managers that have to take their responsibility to lead their business to success instead of leaving them to crumble.
It must give a lot of satisfaction when you’re a higher manager in a company and success are only or mainly thanks to your leadership. On the other hand, those decisions don’t always turnout well. It is a pity that when it goes wrong, people always need someone to blame and most of the time the managers, responsible for the ‘wrong decisions’, get fired.
By Evelien Van Gaeveren
Source: De Ridder, A., ‘Nyrstar maakt van de nood een deugd’. Netto, 41 (2009): p. 30-31.
That’s an interesting article Evelien, you’ve written it very fluent.
BeantwoordenVerwijderenI agree with you saying that this needs some courage and that it’s a shame that managers with so much responsibility get fired because they made a wrong decision. But, on the other hand, when I had a company and there are some managers who would make large mistakes and my company suffers, I think, I should give them a change when it’s a small mistake but when it comes to a lot of money, I think you shouldn’t have to think twice. And if you’re a manager, you know in advance that this is a big responsibility so, and I think it’s normal, that when something’s gone wrong, people have to blame someone and this is mostly a manager because of his responsibility. I think managing is an ungrateful job in times like this because people always search someone to accuse.
Greet
Livine
Dear Evelien
BeantwoordenVerwijderenI liked reading your blog and it’s off course very well written.
I especially liked the article, because of the article I read and discussed this week about the consequences of the crisis. Will companies become more careful because of the crisis or will they be as ‘fearless’ as before?
I liked the fact that your company is careful after the bad economic times. They keep on focusing on the structural saving of its costs and this is, to me, very smart, because the crisis might have some late ‘effects’, so a financial ‘safety plan’ might be a very good idea.
They are also doing good by using vertical integration in their business, because after a time of crisis, the main concern for companies is to be as little dependent as they can be.
It is maybe a bit of a strange thing to say, but I suppose that for many companies, the crisis was a good way of rethinking their business practices and maybe a lot of companies will come out of this stronger than before, because now they have literally seen what their weaknesses are.
Kind regards
Lien Vanneder