8-week Operations optimization sprint to reach deal thesis savings for a merged PE PortCo

PROBLEM

A medium-sized manufacturing company had acquired a competitor and needed to turn around operations quickly in order to recover from a COVID-induced business slump. Part of the deal thesis was an increase in contribution margin (hence EBITDA) from the transfer or SKUs from higher-cost plants to lower cost plants.

The company needed project management and cost analytics support to achieve deal thesis savings in a quick timeline.

SOLUTION APPROACH

We quickly verified an updated deal thesis savings based on cost data of the legacy and acquired companies.

We designed a capacity and demand model to enable the plants to meet customer demand while the SKU transfer project was going on. Based on this capacity and demand model, we worked with Quality, and R&D to conduct tech transfers, worked with the Operations team to ensure proper training and staff support, and completed SKU production transfer of multiple SKUs in 8 weeks.

RESULTS

Deal thesis savings exceeding $40M annual contribution margin increase achieved within 8 weeks of the deal close date.

This quick win was used to drive momentum and culture change for the rest of the integration activities.