Ferran details 4-step turnaround plan

Electronic News, June 16, 1997 by Chad Fasca

Mr. Ferran will draw upon his past turnaround experience in righting SubMicron Systems. As president and CEO of Tylan General, he led the combined company in a successful turnaround effort and remained president and CEO of Tylan General from 1984 to January this year when the company was acquired by Millipore.

In an interview, Mr. Ferran said he will employ a four-step plan to return SubMicron Systems back to profitability. First, the company will reduce expenditures--a move that is usually the first step in any turnaround plan, according to Mr. Ferran. He expects to complete this step by the end of June.

His second step is to refocus the company on its core technologies. According to Mr. Ferran, that means SubMicron Systems will sell off a number of business units outside the company's initial focus of wet surface preparation, otherwise known as wet clean or wet stations. He expects to finish these divestitures by the end of the third calendar quarter.

The third step and perhaps the most important, according to Mr. Ferran, SubMicron will invest in the development of a professional management team. He wants to rebuild the executive management throughout the middle level of the company. According to Mr. Ferran, the company will turn to outside means to fill its management team.

Fourth, he says, SubMicron Systems will have to embrace a fundamental shift in the way the company develops and manufactures its products, "bringing us in line with what world-class manufacturing companies have done historically."

"We are going to be instilling a lot of discipline in this organization that has been lacking for some time, basically in all of the functional areas." The final stage of restructuring should conclude in Q4, with some spillover into 1Q98.

Given the current state of SubMicron Systems, Mr. Ferran is very optimistic about the company's future. He says that the company's revenue growth outstripped the growth of the management, leading to "a $170 million company that had the systems and discipline of a $10 million start-up."

In little more than one month, the atmosphere has already started to change, Mr. Ferran said. "I think the people are starting to see that there is a future here. I think what they see is that the company has outstanding core technology. We believe we have world-class core technology, and it's been execution that has been our problem."