Your trusted family car is due for a Major Service. It has loyally, and at times, reluctantly, taken a bit of a beating over a harsh winter and long family road trips. Arriving at the car dealership to book the service, an eager salesperson rather suggests you trade your car in for a shiny brand-new vehicle or, at the very least, you need a full engine and gearbox swap. You feel that this unnecessary ‘upsell’ actually masks the lack of experience of its staff by suggesting expensive alternatives instead of simple repairs. The increased cost of living has taken its toll on your family finances, while the dealership is eager to make some money from you and hit their quarterly sales target. You do not feel they have your needs and interests at heart.
At AB Advisors, we understand that business leaders often face a similar challenge when seeking help from consultancy firms…
Here’s How We’re Different
Just as a simple service or tune-up can revitalise your car’s performance, many business challenges can be addressed with a good diagnosis and a pragmatic approach to solve a number of problems which often look like small recurring irritations, but actually have a much bigger negative impact on your business’ performance than you believe.
A simple example is a company where, right up to the CEO, the executives would receive several complaint emails per week of damaged goods (with pictures) from their major customers. Often, the issue was treated on a case-by-case basis as if they were a series of unrelated anecdotes. The ‘solution’ was the COO regularly sending the message to the warehouse “You have to pack the goods properly”, thereby passing on the blame to third-party logistics (3PL).
When we looked at the problem, we immediately realised that the solution wasn’t to improve the packing method but to alter it. The root cause lay in procurement’s purchase of inadequate (albeit cheap) packing materials to meet annual savings targets. The way of wrapping a pallet, laden with $3000 worth of goods, was only evaluated in terms of its immediate cost, neglecting the repercussions down the line. The expenses incurred from damaged goods, lost sales, AND the C-Suite’s diverted attention are not factored into their assessments. Not surprisingly, these costs far exceed the simple addition of two nylon straps to each pallet during the packing process.
We pride ourselves that our experienced consultants not only know where to find the problems in your value chain, but they also are still hands-on and pragmatic. In addition, we do not just “repair”, we also teach your teams how to fix the typical small problems and/or will guide them to do so. To use our garage example: you probably know how to add air to a tyre. But you might not be able to diagnose poor handling as being caused by a lack of air in one wheel.
Our team is not going to simply take your car into a closed workshop, reinflate the tires behind the screens and then charge you $150 with the message that the problem is now solved. Our people will explain what is the cause of the poor handling, how you can self-diagnose it and will teach you how to adjust those tyre pressures yourself. And, if necessary, handhold you through the operation the first time.
As such, we aim to bring a new lease of life to your business and buy yourself some time to assess whether and when you need to make a more substantial investment to make yourself futureproof for the next few years. And when it comes to deciding whether you first need a new set of shock-absorbers, a new gearbox or an engine overhaul to beat your competitor, we will be there to guide you through the process to ensure your roadmap gives you the most bang for your buck.
A Small Case Example.
A client complained about deteriorating service levels (dropped below 40% OTIF), a resulting tsunami of customer complaints while not being able to really reduce stocks in line with the target of the Private Equity owners. They were not a small under-resourced medium-sized company, but a leader in their industry – a global B2B manufacturer supplying the Utilities and Construction industry, with German roots and a state-of-art flagship plant in Europe staffed by well qualified people.
They had been told they needed a 6 months ‘all-whistles-and-bells’ project with 5 consultants to implement a state-of-the-art planning tool. Implementing this complex planning application would only have had a marginal impact as the underlying issue would remain unresolved.
Our AB Advisors team diagnosed the root cause to a “simple” lack of alignment between product portfolio and market demand on the one hand and basic manufacturing and inventory strategy on the other. We segmented the product portfolio in a Make-to-Stock and Assemble-to-Order plus a full Make-to-Order category. We then ensured the manufacturing strategy and the procurement and inventory strategy were aligned to these new, simple policies.
The result was an uplift of capacity by 115% and a reduction of overall inventory by 42%. This vastly improved supply chain reactivity and brought back service levels to well above 95%. The fact we also did this with 2 people over the course of 5 weeks, was an extra financial bonus saving for our client. No need for 5 people on a 6 months project implementing this equally expensive and hard-to-manage planning system.
It is time to challenge how you ‘service your car’! Contact us for a full diagnostic check and vehicle inspection to make sure your car is roadworthy for the future.
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