ºÃÉ«ÏÈÉúTV

Mike Jeffries cuts an intimidating figure. Despite a slight stoop brought on by his 58 years, he is still a colossally tall, powerfully built man. And then there are the jet black, sharply angled eyebrows, which give his face a naturally stern look. But most of all, he has a crunching handshake, the bruising effects of which can still be felt several hours later. ºÃÉ«ÏÈÉúTV decides against criticising Jeffries for being 40 minutes late.

Besides, his lack of punctuality is understandable. Claiming to work most hours, seven days a week, Jeffries is a director of printer De La Rue, chairman of Wembley National Stadium Limited and now chairman and acting chief executive of Atkins, which this week told the stock exchange that it has begun sale negotiations.

This news comes as no surprise to many, after the firm's horrendous 2002, during which its share price fell by more than 80%. He says: "The workload at the moment is massive. In the past six months I've had several offers to do other work, but I've turned them down."

The bulk of Jeffries' time is taken up by Atkins. He originally resigned as chief executive of the superconsultant in April 2001, and replaced Sir Alan Rudge as chairman. The move was supposed to help him cut his workload until he followed Rudge into retirement. Robin Southwell, a marketing man with defence supplier BAE Systems, was appointed chief executive. He was going to take Atkins in a new direction, towards becoming "the world's first-choice supplier for technical services and integrated solutions for the built environment".

Less than two-and-a-half years later, that dream is dead. On 1 October last year, Atkins' directors were hit by financial figures they could only have glimpsed in their most feverish nightmares. Within hours of receiving the news, the directors issued one of the biggest profit warnings in City history: a loss of £5m for the six months to 30 September. Shares slid nearly £1.50 and 400 jobs, including Southwell's, were swept away. It was left to Jeffries to pick up the pieces.

In the four full months that have passed since, Jeffries says, Atkins has got on top of its problems. This summer's results should show a pre-tax profit of £15m; its share price has recovered from its low in October (although, at less than a pound, it is still far behind its year-high of 697.5p); the search for a full-time chief executive is under way; and the company has sorted out the problems with its IT system – the main reason for its ignominious fall. Jeffries confirms that he has begun "very, very preliminary" talks with a buyer – believed to be a venture capitalist. But at the end of last year, he said companies should only sell from a position of strength. And although Atkins may have recovered some ground, it has not got as far as regaining its traditional standing.

Perhaps we thought we could walk on water because of the kind of company we are

The problems started when Southwell and the Atkins board decided the company needed to introduce three radical changes: new IT hardware, new IT software, and the consolidation of its back-office departments in a "shared services facility" in Worcester to process payrolls and invoices. The disaster followed the setting up of this facility in May 2002: the new system that it employed proved more difficult to implement than anticipated – in fact, so difficult that invoices stopped being processed. Jeffries says: "With hindsight, if we'd just stuck to the new hardware platform and the new software, I think we would have been fine. It was changing our business processes, which was much more human; that is where the issues arose. It was trying to get people to understand what they needed to do."

This human error was compounded by the fact that the 350 staff in Worcester were new to the company and didn't understand Atkins' culture. Jeffries admits that the company tried to do too much, too soon. "Perhaps we thought we could walk on water because of the type of company we are."

Jeffries generally refuses to discuss Southwell's stewardship during this period.

The City speculated at the time of Southwell's departure that there was animosity between the two. Some even argued that Southwell was made a scapegoat. Although there were some calls for Jeffries' head after the profit warning, Jeffries himself hints that Southwell had to carry the can: "The management has got to be driven by the chief executive. Everybody's impatient, wants to try and do too much at once; do things too quickly." When Southwell was in charge of BAE Systems in Australia, he was called a "38-year-old teenager" by the press because of his legendary enthusiasm and energy.

Before our meeting, however, ºÃÉ«ÏÈÉúTV learned that Jeffries wrote Southwell a glowing reference for his successful application for the chief executive role at European aerospace consortium AirTanker. Jeffries restricts himself to: "I got on very well with Robin personally. He was a great guy."

In November, Jeffries handed the board a shortlist of four candidates to be Southwell's long-term successor. However, it seems that these candidates were not up to scratch. At least half-a-dozen have been interviewed since new year, and it seems likely that the final appointment will be for a chief operating officer – or a "chief executive designate", as Jeffries puts it. Jeffries says: "The COO wouldn't join the board on day one, but he'll be in attendance. If we find an exceptional candidate, where everybody's confident, then we might go straight to CEO."

The hesitation illustrates the company's caution after Southwell. In an ideal world, the boss would come from the "periphery of the industry"; Southwell was an outsider. The new boss will also hold an engineering or technical degree and will have financial expertise; Southwell's degree was in the social sciences.

But not all of Southwell's work was in vain. Jeffries is just as ambitious: he believes that the company can grow far larger than its current strength of 15,000 (to "infinity", no less), despite accusations that it is unwieldy. And although Southwell's creation of 15 divisions is under review, Jeffries praises the way the method aimed to make accounting simpler: "He was trying to present the company in a way that could be better understood by people who have a relatively small amount of time, like analysts and fund managers."

Jeffries, unsurprisingly, believes the company is over the worst. He dismisses comparisons with Amey, saying their only similarity is that they both begin with an 'A'. The fact that net debt will remain at its current level of £120m is of no concern. Without computer remediation costs and redundancies, it would have been cut by £105m. Jeffries reckons this shows the underlying business to be strong. (By contrast, Howard Seymour, an analyst at stockbroker Bridgewell, believes it shows only the length of time needed before the benefits of the new system come through.)

Jeffries' main aim now is to get margins back to 5.5-6%, hoping that the market will respond by pushing up the share price.