Capital efficiency

Support a global metal industry company to radically improve working capital turnover

Challenge

The client needed to reduce its working capital significantly as rapidly increasing raw material prices challenged the balance sheet.

Approach

We choose overall a top down and bottom up approach to set the right corporate ambition and to develop ambitious and committed improvement plans in all business units. We initially performed a root-cause analysis of the working capital situation at 20 manufacturing units in Europe, North America and Asia. Together with the local business line manager and functional stakeholders priorities were defined and improvement plans developed and launched. The development of a follow-up system including reporting structure finalized our approach.

Value

The plans were developed with a target to improve the working capital turnover by more than 25 % during an 18 months period. The working capital turnover was finally improved by more than 30 % (150 MEUR) and new ever more ambitious targets have been set.

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