The challenges
A global, family-run manufacturer of plastic compounds was faced with a number of challenges significantly affecting its EBIT margin. Despite a robust market position, idle manufacturing capacity with high fixed costs and increasing competitive pressure resulted in losses. Strict new EU regulations were also making the situation worse. An extensive consolidation and transformation of two affiliated companies and their plant structure was therefore necessary. At the same time the cultural demands of a family-owned and managed group of companies had to be factored in.
Our approach
We divided a wide-ranging project into several phases in order to support the integration and transformation of both companies.
The initial step was to define a strategic vision, a communication plan for the transformation, improved financial objectives plus strategic and organizational guidelines for the merged companies. This was followed by the development of concrete optimization and integration measures to increase profitability and transform both companies. At the same time measures for change management and communication were planned and implemented. The final stage was to prepare the implementation of the measures, achieve the initial quick-wins and manage the co-determination process with the members of the Works Council. Following detailed analyses and close cooperation with the management, we prepared customized solutions that significantly improved both the operational efficiency and the profitability of the integrated company.
The solution
By sharpening the strategic focus and realigning the market objectives, a new target operating model was developed that combined the strengths of both companies. A central component of this model was the definition of a new production footprint based on specialization concepts.
A tool-supported ABC analysis reduced the complexity of the joint product and customer portfolio. The administration and manufacturing overheads were also reduced and collaborative processes as well as clear interface principles established throughout the group. Significant short-term cost-saving potentials were identified, and detailed optimization measures and a business case were developed. The entire process was accompanied by continuous change support for staff, including a communication concept for the merger.
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Your Contact
Stefan Roeske