A large manufacturing company had performed strongly over decades, however a significant deterioration in market conditions had significantly impacted revenue forecasts and ultimately the projected NPAT for 2016/17 and 2017/18. This forced the company to re-assess its strategy to address the headwinds.

The company had strict Bank Covenant ratios (around debt) and needed to be pro-active, otherwise they would exceed these ratios. To ensure they remained in a strong financial position, the Board supported a management proposal to implement a Transformation Program.

[toughproblem] were engaged and put in place a program that promised to deliver the following;

  • A comprehensive organisational re-design to improve strategic alignment
  • Identification of Quick Win cost saving opportunities
  • Assess CAPEX policy to improve investment outcomes
  • Identification of long term initiatives to improve the Company’s cost and competitive position

Original source: Tough Problem Case Studies

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