Company founded in the 70s, dedicated to the metallurgical sector and a General Director of recognized prestige. With an approximate size of 45 workers, it has an extensive portfolio of clients and enjoys the recognition of the industry. Despite this, it suffers considerable losses, a situation of worrying lack of liquidity, and faces a pressing debt.
The industry is very fragmented, competition is very large and there is an unsustainable price war that has reduced the margins in which the sector moved in the past.
The emergence of small businesses and self-employed individuals and the lack of involvement of the Administration in pursuing those who carry out the activity without adequate and certified facilities has allowed this reduction in prices and has caused larger companies to suffer serious problems to sustain the dimension of its structure.
Despite its situation, the company continues to operate as in the good times, when perhaps they could afford not to squeeze the productivity of the company’s resources by having a considerable margin.
During the first weeks, we audit all the assets and liabilities of the company as well as all the personnel and carry out an exhaustive analysis of all the areas of the company: treasury, operations, sales channels, control, etc. We analyze the challenges that the company faces and the resources that we have available to fight the battle.
Once the analysis is finished, we propose an Action Plan duly documented in a detailed Business Plan, which proposes improvements for all the departments of the company. Once the General Director approves the Action Plan, an Improve Advisors consultant is integrated into the company as Manager and leads the proposed changes in the different departments:
The tasks in this department are mainly focused on process improvement. The use of technology is minimal and we get great benefits translated in time that we can devote to reporting and control tasks.
The IT staff is replaced by the services of an external company since the company only needs specific services in this field.
Financial re-planning and a fully optimized treasury management to deal with the payments are urgent.
Changes are made in the forms of payment, financial instruments are replaced by more adequate, efficient and lower cost and agreements are reached with the main creditors to delay the return of the debt over time.
New financial entities are visited and we are able to expand the company’s credit lines.
We are looking for new material suppliers to extend our credit limits, we also take advantage to renegotiate conditions with some of the existing suppliers.
We analyze the accounts receivable, which are overwhelming, and we allocate a full time to one of the people of Administration, who now works more agile and does not need so many resources, to manage the recovery.
The routes of the operators are completely changed making their trips much more effective, achieving savings of more than 35% in travel expenses. In addition, as a consequence, the company’s fleet of vehicles and its associated cost are reduced.
We introduce a new management program for operators that facilitate the taking and sending of delivery notes so that when the operator is leaving by the client’s door, Administration already sends the invoice and passes the corresponding bank receipt.
Finally, we designed a flexible compensation system for the operators, who have the possibility of earning more money for how many more clients did and on the contrary, they are penalized if the number of enhanced clients is small.
Previously there was no control or monitoring of commercials. They themselves organized their time according to the area they had assigned and did not make any report of their activity.
Our proposal is to take advantage of the resources available to us at the headquarters to plan the visits of the sales representatives from there, supporting us with the technology to inform them about the visits we have previously coordinated from the headquarters.
In addition, we meet them fortnightly to share experiences and report the visits made.
In addition to seeing the treasury alleviated and not living with the pressure of the lack of liquidity, the organization is now properly sized.
Operators are much more productive because they spend less time traveling and are much more efficient because they know that it will have an impact on a higher salary.
The commercial team multiplies its visits and new clients are generated.
In the central offices, they work more smoothly and do not accumulate the roles as before. Everyone recognizes the meaning of their function and works with a relaxed climate not exempt from the demand that such a dynamic company requires.
The improvement of the internal circuits of the company allows the General Director to work on the control and monitoring and think in the long term instead of basing his day to day on the fires that should be extinguished.