$750 Million Company Increases Cash Flow by $57 Million
A $750 million business had been growing revenues in excess of 15% per year. Operating margins had flattened at 12% of sales three years ago and dropped to 10% in the year preceding our project.
Though senior management had intuition about where the inefficiencies lay, front line managers were too focused on getting product out the door to identify & capture improvements. The entire team was increasingly frustrated with slipping performance.
A six-week diagnostic project identified the highest potential areas for improvement and delivered an immediate cash flow increase of $6 million per year. Eight months of detailed further analysis and implementation delivered an additional $51 million in cash per year.