Without employees –
no change.

The largest customer of an American supplier had radically changed their material sourcing. The company was not prepared for this change – major business disruption was looming. Sales and Technology had to coalesce quickly and to speak with one voice now and in the future. The resistance of established opinion leaders in the company was significant – the time however short.

My Solution: Joint development with key stakeholders of a target oriented structure; separation in application based segments; strategic focus and accountability for results by segment; staffing with technical and sales employees according as required.

The plastic business unit consisted of several diverse product groups – but was managed by an overall strategy. Stagnation happened!

Together with key team members, I developed a new structure: separation into multiple application oriented segments with separate responsible segment managers; individual strategies according to the entirely different market requirements.

The transparent reporting of these segments created positive internal competition to be better than the others – the improvement of the individual results created a dynamic team spirit. Becoming the most profitable unit in the business group grew external recognition and influence.

The company decided to acquire a leading competitor. The business had to be integrated after the successful acquisition, even though almost all functions were duplicated and the company cultures could not have been more different. Significant challenge:
A “merger of equals” was explicitly promised.

My task: Despite resistance, tight timetables and restrictive government conditions, consolidation of the existing production- application development and sales departments into a new structure; assuring retention of existing business and preparing for growth.

The business group had to tighten and standardize the global supply chains. My challenge: develop, implement and lead a new “Supply Chain Management” department. For this, responsibilities had to be decoupled from production, marketing and sales which led to resistance from the management of these departments. To overcome this situation a new identity had to be formed for the new department – across four continents. At the same time, processes for order entry, production planning and logistics as well as receivables management had to be internationally standardized and simplified, but regionally implemented.

The various and separately managed research departments of a large company had to be transformed into a lean, powerful unit – employees need to be business driven. Four research departments and two central units had to be consolidated; in the past these organizational units had not cooperated with each other and they had not worked in a business oriented manner. All employees were assigned to new product based research units. A joint stage gate process was introduced to assure the accurate evaluation of the projects. This process required the shared responsibility of manufacturing and marketing.

A consequence of this consolidation was unfortunately an excess of research personnel and laboratory capacities, which I also had to manage.

The Parent company decided to carve out several large business groups. These businesses were to be set up market driven with a new business culture to return to the path of success.

The technical and organizational carve-out had to be implemented, a future oriented identity for the new organization created and at the same time a new reality in dealing with the Parent company enforced. These employees all of a sudden became customers or suppliers of the carved out businesses and did not understood why they had to negotiate contracts with former colleagues or why they had to pay market prices.

The business unit was unprofitable and required urgent restructuring. The largest problem was that regional capacity distribution and plant utilization was not in balance. The company was only marginally represented in the boom markets in Asia. Notorious overcapacities governed the western countries and large volume products produced big times losses.

The EBITDA results were quickly improved by 10 Margin % through a consequent focus on results, elimination of the former volume strategy, adjustment of the production capacities to the demand and the elimination of low margin businesses.

A prototype job was to „sell a high risk business unit“. Critical success factors were:
a tight project management and an early and frank incorporation of the work force and the works council. Expert teams from production and technology, marketing and finance were identified to work on the offer memorandum, management presentation and the due diligence material. A convincing Equity Story had to be developed and convincingly presented despite the known earning difficulties. A special challenge: an appropriate balance of interests of the selling Parent company and the new future focused standalone business unit.

One unit was fighting with declining business results, corresponding over-capacities and unproductive machinery with growth products. Capacities had to be quickly adapted to the demand. Product portfolios were consolidated; production processes harmonized, unproductive assets replaced and three of ten sites shut down.

Country subsidiaries were closed and procurement, sales and logistics consolidated across Europe. The profound changes were a bit comparable to an open-heart surgery. All these changed had to be achieved during current operations. The risk of disturbing specially core customers required open dealings with mistakes and a sales management close to the customer.

A family business in the Middle East was focused, among others, on plastics-intermediates for the local market. Since local growth was limited, free capacities was used for selected export businesses. In the framework of a strategic realignment diversification was achieved by extending the business to the Mediterranean neighboring countries with respective new facilities. This allowed for flexibility in dealing with suddenly arising risks. The extended product portfolio provided additional growth.