My New Delhi saga ended with the grounding of ‘Choice Air’. I started to wind up and was getting ready to move back to my headquarters in Cochin.
By this time, I knew nothing was going to be smooth sailing. I was challenged by the fact that I was unaware of the damage that was caused due to my prolonged absence at the Head Office during the airline debacle. I got back to Cochin and after fielding all the questions from the press and people around me at Cochin, I decided to walk into my headquarters & stay put in my office, fully geared to analyze the financial status of my company and its health. I had written earlier (hope you remember) that we had one of the best corporate offices in Cochin with a health center, restaurant to a club room as well, fitted with many amenities.
As I walked back into my head office, I saw gloomy faces and more visitors at the reception desk. I called for the first review meeting and invited all my seniors to the board room. I, of course, owed them an explanation of what happened in Delhi and as I started to enquire of the status of Choice, I heard the news that I never expected. I quickly assessed the situation and, all I can say is, my company Choice, was in trouble. It had a post-tsunami affect everything in the negative financial parameters, production efficiency, cash flows, over-due payments, issues with banks and not to mention, the creditors to whom we owed money. Those visitors whom I saw at the reception in large numbers were vendors waiting to see my finance head to get paid for supplies they made. Here I was in deep trouble.
From 1987 to this date 1994, I was a high flyer with only good news coming my way and never faced many financial difficulties. Friends, I want you to know that, when the going is good, everything will look great. But I am sure, some of you will know the impact that can be felt on one’s own mind and attitude when you get into a crisis, especially financial crisis.
Within a week I measured the damage, assessed the intensity of the issue and started to make plans to overcome the trouble I was in. I am sure you would like to know why things went wrong. It was not simply due to losing money in the airline project. It was due to bad delegation and poor control on the process of the business, coupled with deficient MIS (Management Information System). Businesses can slip off your hand quickly if you don’t have defined delegation and proper monitoring. These two factors were not properly in place at Choice while I was living in my dream world of launching an airline.
I had lost ground, I had lost focus and here I was in deep trouble and that too, with limited resources. My main businesses at this time were seafood processing and the shipping business. The construction division was not doing well prior to the airline debacle due to bad market conditions. The Choice School was running without any issues, thank God! This was because the structure of the Choice Foundation was totally independent and was never linked to the parent company. I was getting a bit nervous as I started to get calls from the banks and my vendors; of course, they were calm and seemed to have faith in me and Choice.
I walk into the factory. I saw no energy, shifts not being run the way it was designed to and I could see serious drops in productivity and net yields and of course, we were losing considerable amounts of money every day. Funding these loss-making businesses resulted in negative cash flow and I was extremely tight for funds. My shrimp suppliers stopped supplying shrimp because they weren’t paid and the factory with huge overhead costs started to eat the reserves due to no production.
The news of Choice’s failure got out on the street. It even reached my customers. There was confusion. Of the people who got to know about it, I am sure some were happy of my failure, but I must believe that a few would have said, “What a shame!” Some would have said, “That high flying young man needed to have his feet on the ground!” A lesson well learned. Everyone approached me with negative vibes. “Choice in trouble Choice in trouble”-this was the message that echoed on the streets.
Guts and confidence is something that I believe is your own making and not genetic. We all live in this world, not only to face and embrace good times but also have to be prepared to face untimely challenges. What you need is the belief in yourself.
My auditors met me and gave me a brief which was clear. Choice’s net worth was in the negative and all reserves were wiped out. During this time, because Choice Group was planning to take this company public for funding the airline, the company was a ‘deemed public company’ in status, which meant, Choice had to follow all the procedures that the Government laid down when a public company has erosion of capital. My auditors advised that we file the necessary paperwork with the government, declaring the company bankrupt and asking for protection against secured and unsecured creditors. This news shocked me and I couldn’t accept the fact that my company ‘Choice’, that too, the one that I inherited from my father, deeply cherished and nurtured, was in trouble.
My conscience questioned me. I asked myself, “Why did I do this?” Why did I put this company into trouble?”. The biggest problem I faced was the people around me. I never saw anyone with positive energy talking to me and giving me support. On the contrary, all I heard and saw was negativity.
Friends, can you imagine yourself in this situation?
Watch for what I did on April 16th.