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Strategic Planning helps manufacturer compete successfully

Once upon a time, the third generation CEO of A Midwestern USA machinery manufacturer was in a fast downhill spiral, losing money rapidly due to strong competition in Europe and the strong US dollar exchange rate. Things looked dismal and the red inked flowed. No matter what this CEO did, he couldn’t seem to reverse the trend and get in the black.

One day a fellow CEO suggested that perhaps he needed a complete overhaul of his company to get back on track and he gave the CEO our name. I flew to the Midwest to meet with the stressed out CEO and we immediately connected in our philosophy and approach to solving the problems at hand. There was bleeding at the plant in Great Britain, there was infighting among the various departments and divisions, it was taking too long to get the products (mostly custom made) to the customer, the US dollar exchange rate was killing them, there was high cost in rework, and the CEO, truth be known, really would prefer to be scuba diving in the Caribbean.

We first put a tourniquet on the bleeding in Great Britain. With that contained, we could now address the longer view of how to get this 80 year old company structured so it could move successfully into the future, or be sold at an attractive price. We lead them through a multi-faceted strategic planning process that helped ensure the bleeding was permanently stopped and recommended that it was time to restructure their company and start acting like a global enterprise it had become, rather than the local MidWest factory it was at the beginning. They agreed.

We worked with the company on two fronts. First we helped the Executive Leadership Team design and restructure the organization in to a truly global matrix allowing for the actual manufacturing of the various components at whichever global facility could do the work most cost effectively. If the environment was not friendly in Europe, the manufacturing could be done in Brazil. If the US was not the right place at that moment, it could be done in Asia. Flexibility, cost and proximity to the end customer was the key to deciding what part of the world would get to make any one machine or machine part. They created nine divisions, all of which could be served by central corporate operations and finance departments.

We then helped them create their global corporate strategy, which was driven down through the nine divisions created in the restructure.

This resulted in efficiencies that allowed them to be competitive with their European competitors and raised their enterprise value dramatically enough that when a major competitor made an offer, the CEO was able to sell the company and move to the Caribbean where he is still playing happily with the dolphins and turtles.

This is Dr. Sarah Layton. If you have a key issue you would like to address, or if it is time now to revisit your plans for the future, calling us won’t cost you a thing. We can talk through your options and see if one we offer is right for you. 407/ 342-6507 or visit our website and click on free article, How to Grow Your Business. www.Corporatestrategy.com

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Posted by Dr. Sarah Layton in Growth, Organizational Strategy, Strategic Planning, strategic planning, innovation and tagged , , on December 11, 2013.

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