Managed Services Provider with high-risk, low return, project driven business
Company profile
The parent company had completed a successful MBO and was heading for a full LSE listing. The business was re-positioning for a high PE ratio based on long-term contracts and high business loading.
The problem
This project lead business unit was an important part of the company’s ‘technical’ background resource, but had to wash its face financially. The BU operated in the high risk environment of contaminated land recovery and geotechnical engineering and lived under the constant threat of major claims. Commercially the business unit was experiencing losses, high staff turnover and had a dominant client.
The issues - Unclear organisation that had evolved over time meant the high quality skill pool was not communicating
- Lack of processes resulting in variable quality
- Marketing was lead by technical excellence, not customer needs
- Negative margins due to poor cash control and staff utilisation
- Resulting lack of self esteem within management and technical teams
The actions
- Undertook market review, introducing new segments and reducing dependence on declining markets
- Re-positioned organisation to profit centres with revised management structure
- Encouraged enabled culture where all staff knew their role, could operate within known boundaries and felt part of the team
- Created technical communities to instil consistency and technical excellence, orientated to customer solutions
- Rewarded success and innovation
The results
- Within 6 months the BU was turning a profit and progressed to 30% annual growth for the next three years
- Professional indemnity claims ceased
- Successfully entered new market
- Retained all key staff during first year of transformation and reduced subsequent T/O by half
- Positioned the BU as top performer within Group
Philip Markham led this transformation as Managing Director. He is a Link Management Group member specialising in performance improvement and change, where people and organisational issues are challenging success Click here to return to the Case Studies Area Link Management Group Home Page
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