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Case Study
Turnaround at Mechanical Engineering Company
Mechanical engineering company from the packaging industry
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Company Details
- Plant and machine engineering manufacturer for processing plastics and natural fiber
- Global, 3 independent production plants in Germany, Austria and the Netherlands as well as 8 foreign sales subsidiaries
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Situation and Challenge
- Several small subsidiaries with overlapping functions
- No clear alignment of production plants
- Parent company exerts only rudimentary leadership over subsidiaries
- Sales performance flatlining for several years, EBT low to negative
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Objective and Tasks
- Tightening of legal structure and reduction of complexity in the organization
- Creation of a shared-service center for sales, R&D, procurement, FI/CO, HR, IT
- Target: EBIT > 10%, EBT > 6,5%
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Measures and Approach
- Aggregation of production and consolidation of sales subsidiaries
- Reduction of management tiers (focus on divisions)
- Building the shared-service center
- Introduction of a homogenous ERP landscape throughout parent and subsidiaries – SAP S4/HANA
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Results and Achievements
- One plant closed, remaining plants aligned towards single-origin
- Double usage of country platform companies as part of the distribution network
- Establishment of a management company with shared-service center for sales, distribution, R&D, procurement, FI/CO, HR and (leaner, faster, more efficient)
- Supply Chain newly structured and creation of a JIT center
- Sales + 38% vs. 2020, EBT increase of +8,5 % in 2022
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