The company is a reputed panel Electrical builder in the LV and MV segment. They have been in this field for the last 20 years and have earned a reputation as a market leader through technical excellence and customer focus. Their custom built solutions are used in multiple segments including Building, OEM, Industry and Infrastructure. Given the high growth potential, the management were considering capacity expansion to meet future growth targets.
The Electrical Panel market is highly competitive, quality and technical capability are no longer differentiators for customers. Increased competition has led to customers demanding stiff commercial and delivery terms. Pressure on margins is very high and being flexible and ensuring quick deliveries is the only competitive advantage. The business essentially being an “assemble-to-order” environment, has a high dependency on bought-outs and therefore on vendor support. It’s also a high risk business due to high product value, tough payment terms and high lead times.
The need therefore was to strengthen internal operations capabilities in such a manner that it could be leveraged by the Sales team in the market place and grow aggressively.
- Poor on-time performance < 20%
- Shop floor giving a sense of inadequate capacity
- High dependency on owner for day-to-day operations
- Uneven sales booking leading to high pressure in the last quarter
- Unsure of where business is likely to come from
- Transactional approach to sales and business development
- Lack of clarity on business growth strategy and implementation
- Unsure on decisions related to capacity and market expansion
- Concern on internal capabilities to handle next level of growth
- Limited focus on long term initiatives and actions by the owner due to high level of internal focus
- Due date performance: > 65%
- Reduced WIP/Inventory: ~ 30%
- Tripled production output from existing infrastructure and resources
- Predictable sales leading to better resource utilization, reduced cash flows and improved profitability
- Next level management team taking complete ownership for day to day operations
- Improved communication, transparency and team work
- Change to a review and results oriented culture across the board
- Senior team’s managerial capabilities significantly enhanced
- Structured and planned approach to business planning led to quantum jumps in business growth
- Avoided making additional capacity investments which helped them stay competitive during tough market conditions.
- Owner’s time released from day to day operations and sales allowing increased focus on long term and helping them gain market leadership position