Creating the Basis for Growth: Double Turnover, Improve Service, Enhance Collaboration

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Client Challenge

Our client, a supplier in the plant construction industry, had experienced strong growth in sales. New lines of business had been opened up, more extensive and complex projects had been acquired, but internally, the company had come up against the limits of its capabilities.

In consequence, it regularly missed delivery dates, and new and existing customers became increasingly dissatisfied. This dissatisfaction not only threatened future market success, but also led internally to growing pressure and increasing friction between employees and functional areas. The losses due to this friction further degraded system performance.

The company was not adequately meeting market requirements, either in the short-term business, characterized by comparatively simple items and the customer demand for fast delivery times, or in the project business, which often involves technical development and customer-specific specifications. This also included an adequate range of services and appropriate handling of complaints.

Internal processes had developed over the decades of the company’s existence and were capable of adequately handling capacity utilization up to that point. However, the structure that had evolved was not consistently geared to the goal of meeting delivery dates. Responsibilities and duties were to a large extent unregulated, and both leadership and collaboration were largely left to chance.

The internal dialogue was more focused on assigning blame than on identifying root causes and working towards solutions.

In view of the company’s ambitious growth targets, the personnel base proved to be unsustainable.

The goal of our client company was to double its turnover within seven years. Mandat was commissioned to create the basis for this.

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Mandat Intervention

In an initial closed meeting with the management, the heads of the functional areas, and those who would later be responsible for the project, we worked out a common picture of the situation, the existing bottlenecks, and areas where action was needed. Initial basic packages of measures were also put together. The result of the first meeting was the rough outline of a complex growth project.

We structured this growth project in collaboration with the client in such a way that those responsible had manageable packages of measures at hand and did not have to worry about taking on tasks that were too complex or daunting. As a result, the project met with a high level of acceptance.

The main levers that followed were operated by Mandat in close cooperation with the respective experts in the company.

Process landscape: In cooperation with experts and interface partners, we developed a comprehensive process landscape with rules that were consistently oriented towards the goal of on-time delivery.

Project management: For the successful completion of complex customer projects, we designed rigorous, pragmatic project management.

Inventory strategy: In order to ensure that relatively simple items could be delivered quickly and in line with demand, the stocking of relevant components in various production stages was optimized and geared toward the market.

Leadership and cooperation: Guidelines, rules and recommendations were developed for various aspects of collaboration and established company-wide (e.g. meeting culture, e-mail, etc.).

Recruiting and personnel development: We took a systematic look at where development and personnel needs arose and began to address them. For example, the company professionalized its trade fair presentations and employee development measures right from the start of training.

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Results

The project laid the groundwork for doubling turnover within seven years. The management relieved the entire project team after some 15 months of concentrated work.

Process-oriented and methodical: Responsibilities, from sales requests to invoices have been clarified within the company. Interfaces, especially between sales and operations, have been defined. Orders flow more smoothly through the company.

Transparency about the status of all orders: A systematic overview of all projects active in the company, their processing status and the scheduling of further processing enables fast and effective decisions to be made for production control and prioritization of orders.

Complaints and customer service have been professionalized: Services deliver a positive contribution to margin, opportunities for additional sales are examined and seized, added customer benefit is a real selling point.

Professionalization of the interface to the customer: The entire process of order initiation has been systematized so that the customer only has as many contacts with internal contact persons as is necessary to achieve the goal. The availability of the sales department for the customer has been significantly improved. Final acceptance by the customer and the procedure for postponing delivery dates are clearly regulated.

Short-term business: Thanks to an adapted warehousing strategy, delivery times of four weeks were guaranteed for 1,900 items defined by sales. A regular adjustment to market requirements is ensured.

Personnel base: improvement of selected recruiting measures as well as the optimization of training and orientation of new employees enables the company to secure its personnel base for future growth.

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