Manufacturing Success Story
The CEO of a small, privately held manufacturing company.
Background and Objectives
At age 60, the client was eager to begin planning his retirement and the sale of the company. The industry was highly competitive, and his business had achieved a unique niche. This CEO had a number of relatives involved in the business who were also minority shareholders. He became concerned that his company was not an attractive acquisition target and that in the company’s current state, a sale would not be a positive event for him or his family.
Challenges Identified by TPO
- The company had been through a number of operating reconfigurations, yet familial relationships prevented the CEO from making tough decisions.
- Several key departments, including product development, finance, and IT, were dysfunctional.
- Human resource systems were almost non-existent.
TPO Recommendations and Solutions
- Introduced a modern HR function which was subsequently outsourced to TPO.
- Redesigned the finance department and hired the company’s first CFO.
- Recruited new executive leadership with needed expertise.
- Reorganized the company to increase its attractiveness for sale.
- Stewarded the decision making process that led to a change in the family’s role in key positions within the company.
- Replaced the founder with a new CEO recruited externally.
- Brought in the right expert resources to compliment TPO’s work and unrelated subject areas.
- Managed the implementation of the human capital aspects of all projects.
Results and Other Outcomes
The CEO achieved his two primary goals:
- Successfully sold to a privately held international manufacturing firm.
- Maintained family relationships.
The company positioned itself for a successful sale by:
- Growing revenue 66%, from $12M to $20M.
- Attaining ISO certification.
- Selling an ancillary line of business.
- Contributing to the economic well-being of the community by preserving manufacturing jobs.