Turnaround case study 1
Turnaround situation
- R400m turnover FMCG company.
- Subsidiary of a major industrial concern.
- Unprofitable for 8 years.
- Holding company wanted to stop funding losses.
- New MD appointed (internal promotion).
Turnaround management intervention
- Deputy Chairman, Interim Deputy MD and Interim Marketing manager positions.
- 8-person consulting team for 7 months.
- Stabilisation: quick hits e.g. repricing and cost reduction.
- Funding: holding company.
- Fixing: strategy, organisation and operations: closed head office, reconstituted management team, focussed on leadership, competitive strategy and marketing.
Turnaround results
- Profitable within 2 months.
- Switch from R2m profit to R2m loss per month.
- 1st quarter profit for 1st time in history (seasonal market).
- Gained 10% market share in 7 months.
- Fees recovered in 4 months.