Much has been written in MBA programs about turnaround management for senior executives. CEOs, COOs, and CFOs combined with an army of accountants and attorneys can move in and save a company from very serious problems. But what about when the company's downward slide is affecting IT? Is the new financial system going to be installed on time and within budget? Have there been changes on the programming development team working on the new client-server project? How do you get product when your vendors are more concerned with getting a 30 day invoice paid in nearly 120 days, rather than find you the best deal on a hundred more workstations?

To many, a troubled company is one plagued with financial burdens, an employer unable to meet its payroll, or an institution struggling to meet its debts. But trouble can visit a company in other ways. The company's founder and chief executive officer may die suddenly, leaving the company without leadership. Or a group of top employees suddenly exit a company to form their own competing business. Trouble may also appear in the form of a bitter feud in a family run business. Such an event can split a company apart, and at the least, drive key but unrelated personnel out the door.

Sometimes a company grows too quickly. Its expansion simply surpasses management's ability to run it or finance it. Yet another example of trouble is the sudden loss of a company's biggest customer. All of these factors affect an Information Technology department. More importantly for IT professionals, when an IT organization's problems become known, it can affect their reputation. Vendors are often angry and confused by late payments. Technical employees are scared. Internal customers look on with suspicion and uncertainty.

Turnaround in IT can be a different component than most financial or legal turnaround specialists are prepared to manage. Certainly the new CEO will attempt to guide a troubled firm safely through a corporate crisis or reverse the direction of a declining business. But what happens when many programmers who have customized systems decide to leave? How can the IT shop restore its health and stop the resumes from being faxed to and fro? Can the right CIO bring back lost "stars" to bridge the transition?

The question remains - can the new CIO restore a company's competitive edge? First, and foremost, the CIO must verify the operational cash flow. Will payroll be met, vendor obligations paid, and a sense of normalcy return to the department? Have key staff been reassured that the department is no longer bleeding?

Second, does the CIO have the right information to make good decisions? How accurate are the aging reports for the help desk? How many tasks are on the programming manager's desk? Third, how current is the IT shop's technology? Are they running client-server applications on two-year old desktop computers without enough memory? Are they running the latest version of Windows? Does everyone have Internet access? Does the department have a clear direction on their programming and desktop environments for the next year? How about the next two to five years?

Fourth, what is the status of the customer base? If the IT shop is supporting internal customers, paring the number of services can make a real difference in the quality of services. Does the CIO really need internal Macintosh support for a 300 desktop environment with only 10 Macs? Certainly their support is better outsourced. If the IT shop is supporting external customers, expanding the base can improve support. With enough clients, the CIO can justify hiring another web designer or new systems engineer to stay ahead of the development/support game and offer superior support to his existing customers.

Fifth: Is the CIO in synchronization with the company's strategic business plan? If the CFO says that the next two quarters will have no expenditures beyond payroll and meeting current obligations, then it doesn't matter who demands a new PC or which one of his employees needs systems engineer training to be more effective. The CIO must be creative, such as networking with local colleges and universities to establish internship programs. He might also work with the CFO to see if later reimbursement might be possible for IT employees who choose to pay for their own training.

Once an IT department realizes it's in the midst of a troubled company, it can move quickly to minimize damage and restore stability. The first important step is to stabilize the climate surrounding a troubled IT shop. With that, and a network of top management and technical professionals, you can negotiate the best possible outcome with internal and external customers.