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Turnaround of automotive components supplier Wegu Leichtbausysteme

Case Study

Challenge

The earnings situation at Wegu Leichtbausysteme GmbH had been deteriorating for years. Among the problems were the high materials ratio caused by unplanned samplings, and high staff costs due to unscheduled overtime and night work. Atreus was assigned to analyze the potential of each division of the company and implement lasting improvement processes.

Success

Atreus quickly launched an earnings-improvement program that encompassed all company departments and significantly increased productivity. The Atreus manager achieved a successful turnaround in combination with a new sales strategy. 

Interview with Dr. Dirk Tetzlaff, Managing Director of DMB

What is the ownership structure at Wegu?

Wegu was owned by the Bonrath family when they approached us in 2011 for a succession solution and to manage the process of selling the company. We worked with Wegu from 2011 up to its ultimate sale in April 2015 to the listed Chinese automotive components company Anhui Zhongding Sealing Parts Co. Ltd.

 

"Our earnings situation was rapidly going downhill. We hoped to be able to get the company back on track with the Atreus manager’s help."

You want to know what Atreus can do for you in a similar situation?
Contact Dr. Harald Linné, CEO.

+49 89 452249-200 Harald.Linne(at)atreus.de

What part did Atreus play?

After seeing the earnings of our subsidiary Wegu Leichtbausysteme continuously worsen over a period of several years, and having ascertained that none of the countermeasures we took had led to the desired improvement, we turned to Atreus for assistance at the end of 2012. They remained with us until the sale to current owner Anhui Zhongding. The Atreus manager succeeded in implementing a sustainable improvement process and resolutely leading the company back to positive earnings.

How did you achieve the turnaround?

Atreus analyzed all the company divisions, recognized the potential they held and quickly set about realizing it. Among the immediate measures the Atreus manager took was to improve productivity by reducing cycle and setup times. A review of our capacities exposed the potential to manufacture the production program with fewer machines, despite insourcing. Reducing materials costs and renegotiating prices with customers and suppliers were further key milestones. The manager’s close examination of the company’s entire organization and processes really made everybody sit up and take notice. 

"The measures taken by the Atreus manager led to positive earnings well above the market average."

Dr. Tetzlaff has been Managing Director of DMB since April 2007. Prior to that, he spent six years in the top management of the pan-European private equity company Industri Kapital, where he played a key role in the company’s success in Germany with investments such as Gardena, DSI, Sport Group and Minimax. Before moving into private equity, Dr. Tetzlaff was a consultant at Boston Consulting Group for several years.

DR. DIRK TETZLAFF

Dr. Tetzlaff has been Managing Director of DMB since April 2007. Prior to that, he spent six years in the top management of the pan-European private equity company Industri Kapital, where he played a key role in the company’s success in Germany with investments such as Gardena, DSI, Sport Group and Minimax. Before moving into private equity, Dr. Tetzlaff was a consultant at Boston Consulting Group for several years.

 

"Atreus implemented a new project-management culture and coached staff at all levels."

Did the staff cooperate?

The Atreus manager set up a new management structure and remodeled much of the management organization. He put his trust in experienced staff members and implemented a project-management culture in the company. Today, project managers are fully responsible for their projects, right up to readiness for serial production, which wasn’t previously the case. He also launched an extensive training program at all staff levels. 

Production was one of the key levers?

Yes. We quickly managed to improve our productivity, which bolstered earnings and gave us the means to take further action. The Atreus manager recalculated every single product item! With our capacities reassessed, improvements could be made to the production process, including decommissioning older machines. With his help, we redesigned the layout of our production facilities and reduced our materials costs.

What other measures helped accomplish this success?

Of course sales was also a main issue. With a strong new sales strategy, we decided to only deliver to the automotive industry in future. We pushed the marketing of some of our patented products and removed others from our range. We professionalized our sales processes and streamlined our organizational structure. The SAP system was also updated. Each step we took led to a further improvement of our earnings, which then provided more leeway for optimizations and investments.

"We successfully mastered all the challenges presented by new customers and innovative products."

Atreus is the leading interim management provider in Germany and one of the largest in its field in Europe. We solve difficult operational management and transformation problems quickly and reliably. Contact us and find out how we can help you master your situation with management expertise that is available at short notice and that is the perfect fit for you.

Atreus is a co-founder of Globalise – the market’s leading and largest provider of international interim management. Accelerating change and delivering success. Worldwide. Structured as a global group of leading interim management firms, Globalise has the reach to support you in solving your company’s most important issues around the world.