Implementation of “hands on” strategic management process
...transforms a £200m turnover UK based engineering group from a loss to rising profits.
The Challenge
This manufacturing group consisted of 20+ business units serving five disparate market segments. Business planning consisted only of an undisciplined Budget process, and the businesses were not responding effectively to changes in the markets they served. The group had previously relied heavily on “financial engineering” but had eventually been forced to issue a trading statement forecasting a significant loss. A rigorous approach to transformation was needed. The Solution
A tried and tested “hands on” strategic management process was introduced to management. This was applied to bring clarity of purpose and execution, both at an individual business level and at a corporate level. Important was the involvement of operating management in the process from the outset, who were encouraged to apply their their invaluable first hand knowledge. An proven framework enabled local management were to articulate and prioritise the key strategic issues facing their business; and to identify how these issues should realistically be addressed. The Result
Effected a turnaround, from a loss to annual increasing profits, through concentrating resources on two closely aligned high growth potential business segments. Negotiated and completing disposal of low potential subsidiaries with high business risk. The business value tripled over four years.
Additional and important benefits of the process were that individual business managers became more knowledgeable about their market and competition, resulting in enhanced stature with customers and confidence to implement bolder pricing strategies.
Identification of potential acquisition targets also came to light as a result of the process.
“The entire operating management team has benefited from this process; and has a much greater understanding of their businesses and the markets they operate in.” – Main Board Director
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