Creating and implementing a roadmap for change, led to increased margins for a steel fabrication and construction organization
Context and Challenge
As oil and gas activity slowed in recent years, a steel fabrication company saw the drastic impact that had on their revenue, and they realized they had to adapt to the market changes
The facility’s infrastructure, organizational structure, and spending did not adjust to market conditions, culminating in significant margins and cash management pressures
Growth in the business over the year’s had spawned new service lines and numerous ancillary projects, distracting front-line management from key business drivers
The organization lacked formal management systems, discipline, and continuous improvement capability to adapt to the new market realities
Approach
Executed a revenue enhancement and cost optimization foundation, in conjunction with the executive leadership team, that spanned the entire value chain (sales, bidding, estimating, project execution, and project management)
Assessed all business functions and departments to determine top organizational issues (Leadership, Clear Accountability, and Communication) and process issues (Project Planning/Estimating, Business Development, and Project Execution)
Identified potential financial opportunities in three areas:
Increase incremental revenue by $20MM
Reduce variable costs by $2.7MM
Reduce fixed costs by $4.8MM
Developed a comprehensive implementation framework across four themes: Leadership and Performance Management, Front End Optimization, Project Execution, and Cost Management
Formed strong coaching relationship with new CEO, helping him redesign org structure, develop KPI’s for the new leadership team, and identify quick wins
“The program provided a framework that enabled us to understand key issues and to confront them.”