Portfolio companies often run into complex situations that drain resources and stifle performance. In this case, a packaging company saw scrap levels quadruple, late deliveries skyrocket and good customers leave. The management team was doing the best they could, but had limited bandwidth and experience with similar situations. The sponsor could not afford the current level of performance, and the costs and risks of replacing the management team were high. ProAction became, on a variable cost basis, their operating partner.
Background:
$250k negative monthly variances ($1.7m per year in total)
5 GM’s in 5 years
Customer Attrition
Actions Taken:
2-day operational assessment found root causes and were immediately transitioned into execution
Implemented a tiered management system
Conducted quick change over improvements
Managed COVID situation
Activities as the interim GM:
Started a daily operator autonomous maintenance process for Presses and Converting
Started a weekly maintenance PM process for both Press and Converting
Implemented a tool crib min/max for critical replacement tooling parts in Converting
Set up a converting staging area for all machine lines
Started problem solving tools with supervisors and leads in both Print and Converting
Relaunched the Safety Committee
Added First Responders on each shift
Action plans developed for each area from opportunities and tracked weekly on the Tier Board
After operational stabilization was achieved, we began implementing tools and training internal leaders to maintain the new level of performance.
Impact
Output improved between 50% and 70% depending on the line
Reduced scrap and rework levels by 50% in 8 weeks, demonstrating a 90% decline in 12 weeks
Hit customer service target levels and eliminated the backlog
About The ProAction Group
ProAction is an operational consulting firm that works with Private Equity to do three things:
Help you win good deals (and avoid bad ones!) through our pre-close Operational Diligence.
Help your management teams as they transition from an entrepreneurial approach to a scalable, process driven leadership path.
Help you maximize the value of your portfolio companies through the implementation of operational excellence.
We focus on three sectors: consumer products, manufacturing and distribution. We have experts in Lean Manufacturing, Six Sigma, Sales and Operations Planning, Inventory Strategy, Sourcing, Logistics and Human Capital Development. We were founded in 1995 and are headquartered in Chicago.
For Further Information: Timothy Van Mieghem tvm@proactiongroup.com The ProAction Group, LLC Tel: (312) 371-8323 www.proactiongroup.com
The Competition is Fierce. Change the Rules. ™
Comments