Custom Products Group Returned to Entrepreneurial Roots
Rand McNally bought the Nicholstone Bindery in order to diversify its product offerings to the publishing market. The operations manufactured a broad array of custom products, from gold-edged, leather-bound classic books to sophisticated multimedia packaging for the software and entertainment worlds. Reorganized around six market segments, forming cross-functional SBUs targeted at specific markets. Sales grew by 71% and the company returned to profitability for the first time in eight years.
Contract Manufacturer Triples in Value
A publicly-traded, $600 million contract manufacturer in the electronics industry faced an ongoing cash flow crisis: Shippable orders were stuck in the plant because of missing parts; suppliers put the company on COD terms for their shipments; and financing sources had been exhausted. The stress caused a permanent break between the COO and the CFO and their respective staffs. The firm faced a major crisis.
We traced both product flow and the cash cycle, identifying that the lack of coordination between departments caused the company to blindly follow the ERP system. The ERP system funded all projects based on their ship dates,
We identified that the lack of coordination between departments and improper cash allocation by the ERP system caused almost all projects to be underfunded, preventing orders form shipping on time and constraining billing. We assembled a cross-functional team with representatives from Finance, Operations, Purchasing, IT, and Sales to address the issue and coordinate future efforts. Within four weeks, the crisis was solved as orders were reprioritized and properly funded, shortening the cash cycle and improving overall performance. The company’s share price moved from 90¢ to $4.42, creating more than $225 million in shareholder value.
Medical Device Company Exits Receivership
Our team entered a medical device company after a million dollar fraud was discovered. The original charter was to put into place the needed safeguards and procedures to preserve value and protect assets, but soon it became much more.
The company ran out of manufacturing capacity, as cycle times reached 70 days and backorders ballooned to more than 13 weeks. Our implementation of Lean Six Sigma principles enabled us to reduce cycle times to two days and eliminate the backorders.
Finally, the company faced two FDA recalls. We coordinated the actions that enabled the organization to recover the affected product, systematically replace field inventories, and fully address the government's concerns.
Our involvement positioned the company to exit receivership and be sold for more than $300 million.
Stoneware Product Line Rationalized
A family-owned stoneware company never discontinued a design or a product line. In 185 years of existence the product line grew to over 15,000 SKUs in a $3 million company. Ownership consistently and continuously resisted attempts to make any cuts. Established the “Classics” line to preserve the historic, but slow-moving items, removing them from the day-to-day line-up, but making them available on special order for a premium price.
Card Company's Profitability and Positioning with Major Customer Improved
A major card company manufactured all of the playing cards for a major toy company's game operations. These products were causing massive losses as each deck was sold at a 117% loss. Reduced costs 56% by creating a dedicated production line using specialized equipment and eliminating subcontracted production. Lean six sigma techniques reduced cycle time from ten weeks to four days. Effective pricing negotiations raised the price per deck by 57% over a three-year period.
Major Acquisitions Successfully Integrated
Jefferson Smurfit made two major acquisitions (>$2B in sales) within ten months. Publishers’ Paper was the Los Angeles Times’ newsprint operation in Western Oregon. Container Corporation of America was an orphan company in the Mobil Oil empire. The Smurfit Planning group built one of the first comprehensive computerized acquisition models. This model served as the template for each integration, coordinating tactical actions and establishing the foundation for performance scorecards.