An automotive supplier was facing difficult times due to recession and price pressure. Not only did their P&L numbers look bad, they also were beginning to have cash flow problems which caused worries among suppliers and banks.
Our restructuring advice led to break-even within 5 months. At first we established a solid cash planning system in the business. This helped re-gain some of the lost confidence of the company's banks. At the same time we did a detailed analysis of the manufacturing cost. To the surprise of management, many of the company's products were sold below contribution margin. This had changed the entire product mix of the business. The new cost calculation system had a positive impact on the sales team as they now knew that they were only selling profitable products. Also the inventory system could be improved as there were less products and fewer types of raw material in the stock. Finally the process engineering would could generate time savings of up to 30% at a 15% lower default rate.
An investment company asked us to supply them with the Project Management for an industrial plant construction as they were concerned that the company's management would be overspending.
Together with the team we established a project plan to define timing and costing and defined their milestones. It was found out that there were several bottlenecks in the existing project plan, some of which could be removed. It was made sure that every member of the team delivered their tasks on time and we helped negotiate with suppliers to not only reduce the already existing overspent but to make sure that the project went back to budget. Our approach to get into the bottom of each process even helped the engineers to think over some of their process design. Some additional cost could be taken out without impacting productivity.