$200 Million Company with Strong Margins in Low-Growth Market Increases Cash Flow by 40% in 6 Months
A $200 million business enjoyed a high share of a low-growth market and stable 15% EBITDA margins. Senior management sought to expand EBITDA margins by 2 to 3 points.
Initial brainstorming and scoping analyses identified over 200 improvement ideas from across the business. The four-month effort winnowed these to 44 initiatives worth $12.5 million per year. Implementation was completed within six months (ahead of schedule).
Subsequent efforts were launched to exploit further strategic and operational issues identified in the initial project. These initiatives should add another 6 to 8 points of margin beyond the 40% increase already achieved.