We all know too many horror stories of ERP systems gone wrong. More rampant, however, are ERP systems that simply provide a fraction of their potential value. They way the company uses the system, it does the basics. But the company has essentially found a way to convert gold into iron… Jack and his team present ideas to actually get the value your ERP systems can provide. Continue reading Tim Van Mieghem Podcast Speaker: The ERP Organization Change Journal, Episode 13 – The Value of Business Intelligence Part 1
This month’s Spotlight is on Kathy Wishnew. Kathy joined ProAction in 2015 and immediately brought added depth to our front office lean and engineering process capabilities, particularly as they relate to our customers in the service and complex-engineered products industries. She has also been integral in expanding our proprietary 9-Box inventory optimization and customer pricing tool, an innovative process that has helped many of our clients drive meaningful improvements to their EBITDA. Kathy makes transformative change happen. Her skills in lean manufacturing, global business operations, process improvement, program management, quality assurance, Six Sigma, and goal deployment have helped her significantly improve bottom-line performance for companies. Kathy uses a top-down strategy of aligning systems, processes, and people to help those changes stick.
Kathy has led many projects for our clients and below are a couple that highlight the depth and breadth of the positive results she brings to an organization:
One midsized medical services firm was turning down new business due to its inability to meet current demand and the extensive learning curve for onboarding new employees. Kathy worked with their leadership team to restructure responsibilities by centralizing like-work content, creating standardized processes, and instituting metrics that provided transparency when the process was not going as expected. The company has not only started accepting new clients and marketing the offering, their sales have grown significantly without the need to hire additional manpower.
Another example involved a midsized manufacturer of large material handling platforms. The company was struggling to meet critical multi-phased customer on-time-delivery dates and a growing list of backorders. Once one phase ran behind schedule, the later scheduled deliveries would not only require re-scheduling, but many times would incur fines and penalties by the end-users and / or installers. Kathy worked with the cross-functional technical team, that operated independently of each other, to standardize internal deliverables between departments. Many non-value added steps were eliminated, rework was reduced and flow was created between internal suppliers and customers. The list of backorders was reduced by 60% and the company is back on track to meet annual growth targets.
Prior to ProAction, as Vice President at Jarden Safety & Security, Kathy established a lean and continuous improvement program that reduced costs by nearly $9 million its inaugural year. The program created transparency and linked operations to strategic plan initiatives, leading to a record number of new product launches and a centralized quality management system.
Kathy served in many executive positions in her 17 years at Panduit Corporation. One she is particularly fond of was as a General Manager and turning a chronic loss leader in to a profitable Business Unit.
After receiving her bachelor’s degree in Industrial Systems Engineering from The Ohio State University, where she became a member of the Alpha Pi Mu Industrial Engineering Society, Kathy received several certifications. She is trained as a Six Sigma Black Belt, ASQ Engineer, Lean Leader, and Shainin Red X Problem Solver. Kathy is also certified as a Franklin Covey facilitator in the Great Leaders, Great Teams, Great Results and the 4 Disciplines of Execution.
Is your portfolio company ready for the ISO 9001:2015 QMS? We’re less than six months away from the deadline to comply with this revised standard, which was rolled out in 2015. While we’d like to assume that everyone’s preparations are well underway (if not completed), we also know that many companies have put this on the back burner while attending to more pressing tasks. As our Private Equity clients have begun to escalate this issue with management, they’ve encountered a trio of challenges. One or more may sound familiar to you.
The Pain Points
The first and most obvious is deadline stress. At this point, any unexpected monkey wrench while you’re moving toward compliance could lead to missing the deadline. ISO certifications are one of the ways we build trust with clients, so you could risk your position as a market leader, or even damage specific client relationships.
Another common complaint is that the sheer scope of what needs to be done seems overwhelming, especially in light of the resources you’ve already invested in compliance. How is it possible, you may find yourself asking, that we’re not closer to the finish line than this? When you find that quality and efficiency issues still persist, despite your best efforts to have sound processes, the recertification process can leave leadership feeling demoralized and frustrated.
Clients often raise a separate but related concern – the cost of maintaining a quality system can be high. But for many companies there isn’t a single system, there are two. One is the system your quality management team designed, which meets the highest quality standards. The other is the way things are actually done. This is particularly common when a team was rushing to meet a deadline. Rather than doing a deep assessment, then redesigning processes to meet best practices, the team designed a castle in the air that didn’t match the existing foundation. The disconnect between these two realities is often hiding potential EBITDA and a myriad of headaches.
While the actual compliance process is frequently viewed as a headache, the new standard offers many benefits. Organizations that adopt ISO 9001:2015 will move toward a much leaner, process-based approach. This new quality standard is also designed to be tailored to your specific product or service, doing away with a more one-size-fits-all approach. We’re also very happy to see a push toward data-driven decision making.
If you’ve been paying attention to our blog, hopefully you’re making a connection right now. The key components of ISO 9001:2015 align with the best practices we advocate every day. That’s not an accident. You can see why we’d be natural partners for companies on the path to compliance.
What we typically do for clients who are working on their renewal is perform one of two kinds of analyses, depending on your needs. In some cases, an all-areas Systems Audit is the right starting point. Or, if there are specific areas where you feel exposed, we can do a more targeted Surveillance Audit. At the same time, we’ll do a Gap Analysis to highlight opportunities for cost reduction and profit improvement.
This is what we love about this new revision: it aligns your business with your Quality System, which is exactly what we do already. Instead of hiring a consulting firm to help with compliance, then having another firm in later to find overlooked EBITDA, clients who work with The ProAction Group on this will kill two birds with one stone. As an additional benefit, you’ll be able to count our due diligence as an Internal Audit, which it just so happens is a requirement of your QMS. If you’re ready to turn your ISO certification journey into a victory lap, reach out to us.
For Further Information:
Timothy Van Mieghem
The ProAction Group, LLC
445 North Wells St. Suite 404
Chicago, IL 60654
Tel: (312) 371-8323
The Competition is Fierce. Change the Rules. ™
John Lanier is a close alliance partner for ProAction and a good friend. He is a value creation guru and has an unmatched expertise in business strategy.
He recently wrote a great piece regarding Corporate Culture and Capitalism. In it, he addresses analysis paralysis within organizations and the ever-ticking value-creation clock. It’s a wonderful read, and I encourage you to take the time to read the piece in its entirety. Also, be sure to follow the link below to the Middle Market Methods website to learn more about their business.
Corporate culture may be singularly the most potent ingredient of value-creation.
Middle Market Methods™ offers a toolbox of cultural, growth, and efficiency value-creating solutions to portfolio companies of private equity firms. The premise is that best practice adoption correlates with a smoother ride during the investment hold period, resulting in higher exit multiples. Additionally, deal team time is liberated from operational surprises to invest in new transactions.
If you’ve been in the private equity sector for any length of time, you have probably come across the work or articles of The ProAction Group at some point. Having helped numerous private equity clients do better deals, and operate better companies, that sell for better multiples, they’ve earned a reputation as giving their clients an unfair advantage in dealmaking, operations, and exits.
Today we welcome them to our workshop to share with you how they work with Private Equity, and how you can as well.
And here’s how and when Timothy Van Mieghem, a partner at The ProAction Group, works with PE firms:
- The ProAction Group helps PE firms win good deals (and avoid bad ones!) through our pre-close Operational Diligence. In short, we answer the question “How much more EBITDA will you earn when you ‘run the company right’?”
- They help portfolio company management teams as they transition from an entrepreneurial approach to a scalable, process driven leadership path.
- They help PE clients maximize the value of portfolio companies through the implementation of operational excellence (Lean Manufacturing, Global Sourcing, Sales and Operations Planning, Inventory Strategy).
- The ProAction Group primarily works with PE firms that:
- Are pushed to bid higher multiples and want to know they can “get it back” through operational improvements before they ink the deal.
- Are frustrated because performance at a portfolio company is falling below plan and they are not getting a clear explanation from management.
- Are growing tired of the time and energy they have to put into managing a portfolio company. They are damaging a lot of brain cells and not moving the needle. Lastly, ProAction’s staff are all experienced operators, bringing the methodologies they learned and applied at Toyota, Emerson Electric, Danaher, and other leading companies to the middle market.
Listen to the webinar here.
Tim Van Mieghem’s first article discusses our due diligence process which impacts EBITDA, market position and free cash flow.
Tim Van Mieghem’s second article continues with the benefits to increase throughput and the rest of the seafood company’s sucess story.
Download Identifying Operational Opportunities Part II
Tim Van Mieghem’s third article focuses on variable cost reductions and indicators.
Finding, quantifying and mining value hidden in operations can impact your ability to successfully win a deal, and can accelerate your path to a fruitful exit. Discover how we provide operational support to our private equity clients and the impact our involvement creates from pre-close diligence through exit for their portfolio companies.
Download Diligence through Exit
Tim Van Mieghem’s fourth article focuses on reducing fixed costs during due diligence.
Download Identifying Operational Opportunities Part IV