A Japan-based leader in the engineering and manufacture of high-quality precision automotive components has a well-established reputation for being responsive to customer needs. As a result of intensified competitive pressures in the automotive industry, compounded by a major economic recession in the Asian part of the world, there had been a serious erosion of business volume and profitability despite the implementation of numerous productivity improvement and cost reduction programs.
A E78 partner was engaged by the CEO to perform a comprehensive study of all of the company’s operations, marketing and sales approach, product portfolio and administrative functions. The goal of this independent review was to provide a strategic roadmap to improve the company’s growth prospects, profitability, and long-term success potential. This study included an analysis of historical and current statistical data for every aspect of the client’s operations, research into the market and competitive situation for each distinct product line, and one-on-one interviews with twelve key management members.
The study concluded after several months with delivery of a highly detailed report of the findings that were developed out of this process, and a list of 18 very specific recommendations of actions the company needed to take.
- Collectively these recommendations—which spanned specific organizational changes; new planning, analysis and measurement concepts; facility and operations consolidations; pricing approach; relocation, restructuring and/or discontinuance of various product lines; and a complete global marketing realignment—represented a major change in the company’s operations and market positioning
- Eventually, the company adopted all 18 recommendations and systematically implemented them over the next three years
- The client has returned to historical profitability and cash flow levels