As Early Warning is funded by public funds it is crucial that Early Warning is accepted by the private consulting sector, and it is of course a big advantage if EW is supported by the private consultancy sector. In Denmark we were attentive (and a little worried) about how to handle this issue, but we have succeeded. In this paper we explain how we did it, and the considerations behind. Of course local ‘environment’ should be given consideration.

From the beginning EWDK had quite a few critical glances from the private advisers. A few announced themselves as volunteers, probably to keep an eye on things. The most important factor in relation to avoiding the criticism is to serve the right companies and that is the companies in crisis or in potential crisis, and not too large companies. In EWDK a company with 30 employees is a large company.

That the company needs to have signs of crisis conflicts with another consideration/wish, namely that the companies approaches Early Warning early enough in the process so that there are still possible solutions. Some attempts have been made to set up some objective criteria, but it is difficult to do so because there is a ‘grey area’.

  • Is the company in acute crisis and cannot pay its creditors as they fall due, then there is no doubt that they are in the target group.
  • If there is required equity, operating profit and enough funding available, the company is not qualified for service from Early Warning. However, we do make some exceptions:
    Acute and serious illness with the owner(s)

    Serious and paralyzing disagreement among owners

    An immediate threatening condition waits. For instance, when there on a rather small island is planned an additional campsite, but with no possibility for more guests on the island due to limited capacity of the ferry. Another example could be that a small grocery finds out that a big national company plan to open a big store right next door.

The cases that very often give rise to discussion and disagreement are those where the company has a solid equity.

Further arguments and considerations to have in mind:

  • The interaction with the lawyers is a brilliant example on how EW contributes to an enhanced and more qualified private advising of companies.
  • Assistance from Early Warning should be set in due time. Make sure not to continue a course with a company that is no longer in crisis. Here we should refer to the private advisors.
  • EW companies have no tradition for using private advisors. An EW course gives them a better understanding of advising’s importance and they are therefore more prepared to buy private advising or establish a professional board afterwards.

In Denmark, we have found a delicate balance so all Employers organisations supports us. Especially the support from DI (CONFEDERATION OF DANISH INDUSTRY, large and very influential) is notable, because they have a special group: DI Knowledge Advisors. Approximately 25% of our volunteers is running their own advisory business. They understand that EW companies are not potential buyers of private advisory, and they can get more complex and demanding tasks here at EW than they get in their own business.

Basically, EW cases are more satisfying and meaningful than working with their usual costumers.
 

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