ProAction Group provides operational expertise to private equity firms and their portfolio companies. They conducted due diligence for a packaging company acquisition and identified $1 million in potential EBITDA improvements. For a distribution company acquisition, they identified $2.7 million in EBITDA and $6.5 million in working capital improvements. For a heavy equipment manufacturer acquisition, they identified ways to increase EBITDA margins from 32% to 36% through consolidation, value engineering, and new product rollout processes.
Finding and Mining Value Hidden in Operations - The ProAction GroupThe Proaction Group
In this set of slides, you'll find an overview of ProAction's role, values, a few case studies covering diligence through exit, as well as several team member bios.
Slide Deck for The Balanced Scorecard - Implementing Strategy Webinar conducted by BMGI India Consultants in Feb 2010.
For More Quality Content from BMGI India, visit http:/www.bmgindia.com, visit our blog at http://bmgindia.wordpress.com, or join the BMGI India group on LinkedIn.
We would love to hear from you, feel free to write to us at info@bmgindia.com
eXampleCG's Balanced Scorecard Consulting, Training and Advisory services for companies and professionals. Fore more information, visit www.eXampleCG.com
Finding and Mining Value Hidden in Operations - The ProAction GroupThe Proaction Group
In this set of slides, you'll find an overview of ProAction's role, values, a few case studies covering diligence through exit, as well as several team member bios.
Slide Deck for The Balanced Scorecard - Implementing Strategy Webinar conducted by BMGI India Consultants in Feb 2010.
For More Quality Content from BMGI India, visit http:/www.bmgindia.com, visit our blog at http://bmgindia.wordpress.com, or join the BMGI India group on LinkedIn.
We would love to hear from you, feel free to write to us at info@bmgindia.com
eXampleCG's Balanced Scorecard Consulting, Training and Advisory services for companies and professionals. Fore more information, visit www.eXampleCG.com
Organizations that use a Balanced Scorecard approach tend to outperform organizations without a formal approach to strategic performance measurement
- World-class companies are 159% more likely to have mature BSC in place than less successful organizations
- Among 164 publicly traded companies, those with well-deployed BSC outperformed the control group by nearly 30% (Advances in Accounting, 2008)
- Organizations using BSC outperform the other companies by about 100 percent in having everyone in the organization understand what the organization's strategy is (Norton, The Strategy-Focused Organization, 2000)
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Finance dpt and particularly the CFO has a key role to play in the business performance implementation:
- Performance Management needs a frame: Process Management
- Momentum must be led by top management: Lead by example
- All the company need to be aligned: Integrated performance management systems rely on a comprehensive,
- Involvement and commitment of People is a key success factor
- Integrated set of Key Performance Indicators (KPIs) that manage performance throughout and across all levels of an organization
- Continuous improvement by increasing understanding of the core issues driving the performance
- Company must be leaner to be stronger and faster
Delivering engagement in integration webinar
Thursday 3 September 2020
presented by
Jon Burke
The link to the write up page and resources of this webinar:
https://www.apm.org.uk/news/delivering-engagement-in-integration-webinar/
Wondering what Q4 Impact Group is all about? This presentation gives an in-depth overview of the Q4 competencies and the way we work to help you improve your profitability and solve difficult issues.
Balanced Scorecard, A Comprehensive Guide Upendra K
The Balanced scorecard is a management system that enables organizations to clarify their vision and strategy and translate them into action.
Provides an organization with feedback of both the internal business processes and external outcomes, which allows for continuous improvement of strategic performance and results.
Nerve center of an enterprise
The term “scorecard” signifies quantified performance measures and “balanced” signifies the system is balanced between:
Short-term and long term objectives
Financial and non-financial measures
Lagging and leading indicators
Internal and external performance perspectives
The concept of the balanced scorecard was first touted in the Harvard Business Review in 1992 in a paper written by Robert S Kaplan and David P Norton.
The paper introduced the idea of focusing on human issues as well as financial ones, and measuring performance across a much wider spectrum than businesses had done before.
Kaplan and Norton published their ideas in full in The Balanced Scorecard: Translating Strategy into Action in 1996 and it became a business bestseller.
The balanced scorecard is centered on four performance metrics or perspectives:
Customers
Internal processes
Financial
Learning and growth
When implemented properly, each one of these perspectives contains four subparts consisting of
Objectives
Measures
Targets
Initiatives
Creating a Strategy Roadmap for Your Business Indresh Saluja
Extremely critical step by step guide to make a robust strategy roadmap for young entrepreneurs. Align your team with your aspirations, and create a prioritised action plan to ensure successful transformation
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New CEO's are frequently asked to provide a 100 day plan during an interview process. This is one example as to how I have approached this task. Read my blog post at Personanondata.com
Email if want a download copy: michael. cairns @ outlook.com
Vygantas Kazlauskas - How Agile saved Christmas in EstoniaAgile Lietuva
In Estonia, Omniva delivers 18 million parcels per year. In 2018, we set the goal to completely renew our information system by Christmas which is our busiest time of the year. We also opened a brand new logistics centre with the most modern automated sorting line in the Baltics. Without Agile, Christmas could have been very sad in Estonia…
Organizations that use a Balanced Scorecard approach tend to outperform organizations without a formal approach to strategic performance measurement
- World-class companies are 159% more likely to have mature BSC in place than less successful organizations
- Among 164 publicly traded companies, those with well-deployed BSC outperformed the control group by nearly 30% (Advances in Accounting, 2008)
- Organizations using BSC outperform the other companies by about 100 percent in having everyone in the organization understand what the organization's strategy is (Norton, The Strategy-Focused Organization, 2000)
Extending business performance within the organisation - The role of FinanceMehdi J. Alaoui
Finance dpt and particularly the CFO has a key role to play in the business performance implementation:
- Performance Management needs a frame: Process Management
- Momentum must be led by top management: Lead by example
- All the company need to be aligned: Integrated performance management systems rely on a comprehensive,
- Involvement and commitment of People is a key success factor
- Integrated set of Key Performance Indicators (KPIs) that manage performance throughout and across all levels of an organization
- Continuous improvement by increasing understanding of the core issues driving the performance
- Company must be leaner to be stronger and faster
Delivering engagement in integration webinar
Thursday 3 September 2020
presented by
Jon Burke
The link to the write up page and resources of this webinar:
https://www.apm.org.uk/news/delivering-engagement-in-integration-webinar/
Wondering what Q4 Impact Group is all about? This presentation gives an in-depth overview of the Q4 competencies and the way we work to help you improve your profitability and solve difficult issues.
Balanced Scorecard, A Comprehensive Guide Upendra K
The Balanced scorecard is a management system that enables organizations to clarify their vision and strategy and translate them into action.
Provides an organization with feedback of both the internal business processes and external outcomes, which allows for continuous improvement of strategic performance and results.
Nerve center of an enterprise
The term “scorecard” signifies quantified performance measures and “balanced” signifies the system is balanced between:
Short-term and long term objectives
Financial and non-financial measures
Lagging and leading indicators
Internal and external performance perspectives
The concept of the balanced scorecard was first touted in the Harvard Business Review in 1992 in a paper written by Robert S Kaplan and David P Norton.
The paper introduced the idea of focusing on human issues as well as financial ones, and measuring performance across a much wider spectrum than businesses had done before.
Kaplan and Norton published their ideas in full in The Balanced Scorecard: Translating Strategy into Action in 1996 and it became a business bestseller.
The balanced scorecard is centered on four performance metrics or perspectives:
Customers
Internal processes
Financial
Learning and growth
When implemented properly, each one of these perspectives contains four subparts consisting of
Objectives
Measures
Targets
Initiatives
Creating a Strategy Roadmap for Your Business Indresh Saluja
Extremely critical step by step guide to make a robust strategy roadmap for young entrepreneurs. Align your team with your aspirations, and create a prioritised action plan to ensure successful transformation
The First 100 Days: A Planning Framework for the CEOMichael Cairns
New CEO's are frequently asked to provide a 100 day plan during an interview process. This is one example as to how I have approached this task. Read my blog post at Personanondata.com
Email if want a download copy: michael. cairns @ outlook.com
Vygantas Kazlauskas - How Agile saved Christmas in EstoniaAgile Lietuva
In Estonia, Omniva delivers 18 million parcels per year. In 2018, we set the goal to completely renew our information system by Christmas which is our busiest time of the year. We also opened a brand new logistics centre with the most modern automated sorting line in the Baltics. Without Agile, Christmas could have been very sad in Estonia…
New Product Development Philosophy IB Work BetterStephen Tavares
This presentation outlines Philosophy IB's offerings in the New Product Development space including governance and process design and outsourced project management.
3. 3
Company Overview
The ProAction Group serves private equity firms who invest in consumer products,
manufacturing, distribution, healthcare and business services companies.
Our clients recognize the need to improve EBITDA, Working Capital, Competitive
Positioning and Organizational Effectiveness by adding an increased focus on
operational excellence.
We act as a resource extension to owners and management teams. We provide
operational expertise, resources, and tools to help maximize performance.
What makes us distinctive is that we get measurable and sustainable results. We
identify and quantify opportunities, then turn them into reality. We have a relentless
drive to help our clients build winning companies.
Core Capabilities:
Manufacturing Operations
• Lean enterprise / Lean manufacturing
• Outsourcing / asset rationalization
• Quality systems and process
• Inventory and materials management
• Value Engineering
Supply Chain Operations
• Strategy development
• Supplier development
• Asia / global
• Logistics (freight, warehousing and planning)
Sales Operations
• Pricing strategies, processes and disciplines
• Customer and product profitability
• Channel strategies and management
• Sales & operations planning (S&OP)
• Product development process
4. 4
Due
Diligence
• Identify and Quantify Opportunities to Increase EBITDA, Improve
Competitive Position and Reduce Working Capital.
• Identify and Quantify hidden risks and opportunities in the
operations and management processes.
• Validate the investment thesis, from an operational perspective.
Preparation
of 100 Day Strategy
Implementation
of Strategy
Ensuring
Sustainability
• Participate in Strategic Planning Process.
• Facilitate management process to develop manufacturing,
distribution, quality and sourcing strategies / project plans.
• Lead the management team through stabilizing the business
operations (as needed) and through realizing the future state.
• Implement specific projects and processes requested by
management / ownership.
• Help the company institutionalize the habit of improving.
• Transition to a coaching / monitoring role.
• Support specific initiatives as appropriate.
• Help prepare the company for financial events.
Stage 1
Pre-
Close
Stage 2
At Close
Stage 3
First
Year Post
Close
Stage 4
Through
Exit
ProAction’s Role in each stage
5. ProAction’s Role in the Due Diligence Process:
Assess the Company’s overall “Operational Effectiveness” and
management’s ability to execute on its strategic plan (Scalability / Depth of
Infrastructure / Quality of Systems).
Identify and Quantify Opportunities to Increase EBITDA and Reduce
Working Capital.
Identify and Quantify hidden risks and opportunities in the operations and
management processes.
Assess, Document and Quantify opportunities for the Private Equity firm
and its Financing Partners (Validate the investment thesis, from an
operational perspective).
5
An effective Due Diligence Process addresses company strategy,
human resources and organizational development, leadership, IT, and
core operating functions.
Due Diligence: ProAction’s Role
6. 6
Increase EBITDA
• Throughput
• Improve Processes
• Fixed & Variable Expenses
• Product Pricing
• Asset Utilization
• Risk Reduction
Improve Balance Sheet / Cash Flow
• Shrink the Order to Cash Cycle
• Improve Inventory Management
• Increase / Speed Collections
• Minimize Unnecessary Capex
Enhance Competitive Position
• Scalability
• Lead times
• Flexibility
• Time to market
• Quality
• Cost structure
Address Gaps in Investment Thesis
• “Enterprise Risk”
– Including IT
– Operational Disaster Recovery
• Skills Assessment of Organization
• Organizational Development Needs
Due Diligence: Areas / Hypotheses We Test
and Quantify
7. 7
Transform Management Goals into
Actionable Initiatives
• Detailed project plans focused on tangible results
• Quantification of costs and benefits
Identify Opportunities Management
Doesn’t See
• Best ideas from multiple industries and
experiences
• Assessment model and other analytical tools
• Third party perspective
Drive Execution through Resource
Extension
• Experienced people
• Proven methodologies, tools, and templates
Accelerate Results
• Project leadership experts
• Dedicated resources working with
management
Transfer Capabilities, Knowledge and
Tools
• Sustainability of gains
• Education & Training
• Metrics
Post Acquisition: Execution
8. 8
Conduct “Buyer” Due Diligence
• Conduct the Diligence we would implement
for a buyer
• Quantify opportunities to drive EBITDA and
Working Capital improvements in the near
term
• Document remaining opportunities
Implement Near Term Opportunities
• Implement Lean, Sourcing and other
operational improvements – demonstrate the
new EBITDA / Working Capital levels prior to
the process
Develop Communication Strategy
• Work with the team to develop the
communication strategy surrounding the
opportunities and issues identified.
• Develop the supporting documentation
needed to quantify unrealized opportunities.
Accelerate Results
• Project leadership experts
• Dedicated resources working with
management
Post Acquisition: Prep for Sale
9. 9
Manufacturing
• Global Sourcing
• Lean – Factory & Front Office
• Inventory, Pricing and SKU Strategy
• Sales and Operations Planning
• Quality Systems & Order Fulfillment
• Scalability
• New Product Development / VAVE
• CIP / Problem Solving
Healthcare
• Lean – Patient Care
• Lean – Registration and Collection
• Lean – Front Office
• Global Sourcing & Freight
• Metrics Development
• CIP / Problem Solving
Business Services / Energy
• Lean – Service Delivery
• Lean – Front Office / Admin
• Metrics Development
• CIP / Problem Solving
• Logistics / Routing
• Inventory Management
Distribution
• Lean – Picking, Put-away, Slotting
• Inventory Strategy, Control & Management
• Lead time reduction
• Network Design and Consolidation
• CIP / Problem Solving
• Logistics and Routing
Relevance by Sector
10. Values
1. Accurately identify and communicate the right recommendations for
our client needs (this speaks to our competence, experience,
education, diligence/ assessment processes and integrity)
2. Help the client come to understand and embrace the right
recommendations to realize their vision (this speaks to our effective
quantification of opportunities, persuasiveness and demeanor with
the client)
3. Lay the foundation to enact the change / improvement and actually
help the client realize and sustain the future vision (this speaks to our
change management techniques, aggressive and designed
implementation approach and execution, graciousness, relationship
development)
4. Efficiently run projects (this speaks to managing budgets, recruiting
excellent candidates, pricing right, developing an effective
onboarding process and working well with the client).
Note: These are listed in priority order
11. ProAction Updates – Things You May Not
Know
We just completed our 63rd Due Diligence for 18 different PEG’s
We completed 3 projects for Mez lenders in the last year.
Doug Blanchard is now our Managing Director in Charge of all
Service Delivery
We sit on the board for 3 clients
Our most recent hire is a turnaround specialist and serial CEO,
Vince Gurzo. He is leading our interim management engagements.
11
13. Case Study: Packaging Company Acquisition
13
Due
Diligence
• Identified ~$1 million in EBITDA improvements.
• Documented the savings, communicated with investment
committee and financing partners.
• Information helped the PE firm better assess investment
opportunity and develop a strategic plan.
Preparation
of 100 Day Strategy
Implementation
of Strategy
Ensuring
Sustainability
• Participated in Strategic Planning Process.
• Facilitated management process to develop manufacturing and
sourcing strategies / project plans.
• Led management and personnel through lean implementation and
global sourcing efforts.
• Realized nearly $2 million in annual EBITDA gains.
• Increased customer service levels.
• Operating Capacity increased by over 20%.
• Company is now leading the efforts on their own.
• Realized ~$1 million of saving from additional lean and global
sourcing projects.
Pre-
Close
At
Close
Year 1
Year 1
& 2
14. Case Study: Distribution Company Acquisition
14
Due
Diligence
• Identified ~$2.7 million in EBITDA and $6.5 million in working capital
improvements.
• Identified opportunities to increase order fulfillment levels from mid 80’s to over
95%.
• Documented opportunities to consolidate facilities and reduce square feet utilized
by over 250,000 sq ft.
Preparation
of 100 Day Strategy
Implementation
of Strategy
Ensuring
Sustainability
• Led the management team through prioritizing improvements to realize the future
state.
• Developed a full 6 month implementation plan and timeline with management.
• Led management and personnel through inventory planning, lean
implementation and sales and operations planning (S&OP) efforts.
• Within 6 Months:
• Realized over $3 million in annual EBITDA gains.
• Increased customer service levels to over 97%.
• Inventory turns increased from 3.8 to 4.3.
• Company is now leading the efforts on their own.
• EBITDA gains will surpass $5.3 million annually.
Pre-
Close
At
Close
Months
1 - 6
Months
7 - 12
15. Case Study: Heavy Equipment Manufacturer
Acquisition
15
Due
Diligence
• Identified the means for the company to increase EBITDA margins from 32% to
36%. Specifically, we identified the opportunity to:
• Consolidate facilities through lean manufacturing processes.
• Reduce product cost and increase manufacturability and quality through
value added engineering processes.
• Reduce scrap, back orders, expediting costs and lost sales during new
product roll outs (PPAP processes).
Preparation
of 100 Day Strategy
Implementation
of Strategy
Ensuring
Sustainability
• Led the management team through prioritizing improvements to realize the future
state.
• Implemented Lean and Quality improvements that led to:
• 14% reduction in labor costs.
• 25% reduction in floor space utilized.
• An increase in EBITDA from 32% to 36%.
• Dramatic reductions in delays, scrap and rework costs linked to
new product roll outs.
• One on one coaching and mentoring for plant managers led to continuing
improvements after our project completed.
• Company is now leading the efforts on their own.
Pre-
Close
At
Close
Year 1
& 2
Year 2
& 3
16. Realizing Value Hidden in Operations
Tim Van Mieghem
The ProAction Group
(312) 371-8323
tvm@proactiongroup.com