Growth in turnaround business may be leveling off.(Communique)

Indications from the latest poll of Turnaround Management Association (TMA) practitioners are that the explosive growth of the turnaround industry in the past few years may have peaked and is be beginning to level off. More of the respondents to the 2003 Trend Watch poll (27 percent vs. 18 percent in 2002) expect only a slight increase--less than 10 percent--in new engagements this year. Fewer than half of the 2003 respondents (45 percent) expect a surge of more than 10 percent in engagements, compared to significantly more than the majority of respondents in 2001 (63 percent) who expected a jump in business of more than 10 percent. More than a quarter of the respondents (29 percent) in 2003 also anticipated a decrease in revenues this year, compared to 7 percent in 2001, the first year of the TMA Trend Watch surveys.

"The number of professionals who have entered the turnaround industry has grown considerably to meet the additional needs over the past few years," said Randall S. Eisenberg, the chairman of the TMA and senior managing director at FTI Consulting Inc. in New York. "Higher visibility and increased stature for the profession, combined with the weak economy over the past couple years, have caused tremendous growth in the turnaround and corporate renewal industry."

One disturbing trend that the latest TMA Trend Watch survey showed is that by the time companies call on turnaround professionals for help, their financial condition is perilous. About 62 percent of the respondents said that most companies seeking their services are in late stages of decline and 38 percent said most companies are in mid-term decline. "Despite our efforts to urge companies to call for professional assistance earlier," Eisenberg said. "our poll shows little change in management's ...