600M€ Supplier Re-Organisation in Europe
Organizations quickly turn into silos if left on their own. In this European company, originally structured around country organization for language and historical reasons, a North-South divide had emerged at all organization levels. As this evolved into a profit-loss divide as well, upper management considered that talent in the South had become substandard and was considering a major overhaul of the local management team .
CEOACH consultants first analyzed the resource allocation on both sides of the divide. It rapidly appeared that best practices were deployed and shared in the Northern part, while the South had retained historical and unshared practices. Moreover, investments to support best practices were abundant in the North, while refused in the South due to its questionable profitability.
CEOACHconsultant proposed a new organization structure based on manufacturing processes, ignoring geographical boundaries. In order to overcome the cultural challenges, CEOACH suggested that leadership of the new BUs be given to champions of best practices, with a tight timing to generalize their implementation in all plants. Benchmarking with standardized KPIs supported the monitoring of progress across plants. As a result, the Southern plants returned to profitability while the Northern ones benefited from additional best practices from the South. Finally, the organization change was implemented in record time with, actually, very few personnel changes required.