In this period of recession, there is cash crunch everywhere starting with government then companies and organizations going under or relocating to other countries in the world. For those of us who deal with companies as employees, contractors or consultants, it is necessary to know the signs that our beloved company is about the wind down so as to protect ourselves from heartache.

1. Cash flow Problem
This is the primary indicator of a dying company the inability to secure incomes to cover operations; cash crunch will cripple other activities of the company, as it cannot meet its financial obligations.
2. Prolong indebtedness to creditors
These could be contractors, partners, govt etc.
3. Progressive accumulation of unpaid salary arrears: Inability to pay salaries after 1 month 2 month etc. This is a classic tell-tale sign that something is wrong! Companies that treat their employees like trash ultimately loose. Remember Enron.
4. Attrition
High staff turnover ie people leaving the company, especially the top performers, this happens because these geeks have seen the hand-writing on the wall.
5. Company is blacklisted by top service providers and financial institutions.
6. Sudden resignation of CEO or board members.
7. High frequency of emergency meetings in closed doors with no information on the outcome of such meetings.
8. High Cuts in operational budgets and cessation of funding for critical operations.
This ultimately kills the company as it one must spend money to make money in business.
9. High incidence of frauds and embezzlement by staff and management
This happens because the perpetrators see that the company is sinking and want to get what they can take before the crash.
10. Embargo on fresh recruitment and salary increase despite demands for increased productivity by company on its staff.
11. Customers get low value for their money which ultimately hurts the company if there are competitors. This is because there are no new investments by the company.
12. Refusal to innovate and adapt to emerging trends remember Nokia and Blackberry.
Feel free to add yours, it’s sad that people stay don’t know this tell-tale signs.