Restructuring and Turnaround, Industrial Footprint Design

CEC provides with its long experience in general- and corporate management the complete management package from HR to finance, from sales to marketing and pricing, from operational performance to supply chain and procurement. The experience is paired with the decisive HR-sensibility and intercultural empathy. It is this package that allows a quick comprehension of critical situations that require solid turnaround management or restructuring and/or a reset of the industrial footprint.

Example Turnaround

Smaller manufacturing site in Asia producing tailored items (B2B) to industrial end users that has gradually slipped from reasonable performance into a massive drop in yield rates, hence poor delivery performance and escalating financial losses. A closure of the factory was about to follow as operational problems could locally not be resolved.

Approach

• Compact status analysis of financial, operational, sales and HR, review of management team
• Pre-select local rescue team to learn along the analysis process and the applied methodology
• In depth review with team of the shop floor situation by each process and process interfaces, current loss accumulations points, applied shop floor controls, skills of the shop floor team and conduct a 1st assessment of the situation
• Analyze with the team the historic factory performance, deviation of actual vs history and changes behind (technical & non-technical), cross-relate product defect categories vs. (un-) controlled changes, identify main logical bugs
• Coach and encourage the team to define corrective actions along the process line, apply systematic logical proof/disproof loops, coach team to apply methodology till measurable improvements on-hand, stabilize.
• Build KPI-transparency along process line and establish crucial controls at the defined hot-spots, “start-to-see”, establish process ownerships and interface management to assure stability
• Adapt management team, intense team coaching to apply preventive problem solving

Result

• Operational turnaround and profitability achieved after 6 weeks and stabilized
• Essential team building and coaching applying problem solving and prevention methodology to maintain transparency and performance, this aligned with strong lift-up of team confidence which is crucial to keep stability
• KPI monitoring, process stability control, interface management and communication matrix
• Standard costing reset, WIP-control management applied aligned with significant working capital reduction

Example Restructuring & Industrial Footprint Redesign

Multinational company in global lead position producing high performance components to energy transformation and distribution industry. Severe market downturn required a re-design of the global industrial footprint to adapt to the new situation.

Approach

• Mapping of product portfolio, capabilities, core technology & competences, operational costs and capacity utilization per site
• Counter balance capacity- and capability utilization of the sites with new mid-term market situation and required minimum operational margins for the group to maintain sustainable and profitable global lead position
• Model multiple scenarios of site consolidation and related complex technology transfers versus related costs, feasibilities and risks. This with mandate to keep and possibly extend technical leadership but at significantly reduced operational costs and adapted capacities.
• Definition of site consolidation and future lead factories to absorb production volumes and assure capabilities
• manage complex production and technology transfer to lead factories with tailored project management tools

Result

• New industrial footprint and with this the re-set of the production portfolio at the lead factories
• Extended capacities and technical capabilities at lead factories to absorb the production transfers to assure and extend the technical leadership position of the grou
• new industrial footprint of the group with lead factories for high volume, standardized products at low cost facility and top-end non-standard products at technology hub at mid-cost facility
• sustainable market positioning with reduced factories, adapted capacities to match market demands, significantly improved profitability and competitiveness of the group