More Case Studies

  By Michael Neidle  |    Monday May 16, 2022

Category: Columns, Productivity, Recruiting



Here are more case studies from some of our management consulting engagements over the last 2+ decades. 

 

  • This company had just completed the start-up phase of the business, going from operating from the home of one of the partner’ founders, to a commercial office space. Billings at that time were $1.5 million, they added their first employee and started their management consulting engagement with us some 16 years ago. Over the next couple of years, the company doubled their sales (which is relatively easy given a low sales base). By year 5 sales were $14 million, by year 10 they were $21 million, in year 15 this was $44 million, and year last sales equaled $51 million. They survived the 2008 Great Recission (sub-prime housing crisis) and COVID-19. They prospered primarily by doing 6 things really well: 
  1. Investing in their people and did not lay off any staff for a short-term gain
  2. Adding a captive low cost RPO to reduce cost, allowing them to be price competitive across the board  
  3. Hiring, training, and use productivity/efficiency metrics to monitor and motivate their staff
  4. Maintaining their relationships with current/prior clients and not just to rely on penetrating new accounts
  5. Rewarding their staff with very attractive comp plans and motivational trips for their top performers
  6. Operate as a team in separate pods, each with a project manager, sales reps and recruiters 

 

  • This company grew internally and was run by a hands-on owner in with deep industry expertise, but who was a tough task master, a micro-manger with a controlling personality. The company dominated their local market but was unsuccessful in branching out into a markets due these issues. There were other problems. 
  • Firstly, their core business had a shortage of qualified people to hire within their specialty and their clients capped their prices which made it difficult to attract people with higher pay rates which would squeeze their margins too much. To compensate for this, they brought in a key manager who had loyal clients to build complimentary lines of business and doubled sales in 5 years. That person became insecure in their job for the reasons noted above and avoided hiring on a qualified second in command. Eventually, there was a falling out between the owner and the business manager, who quit and started their own business and taking away many of the client they brough in.
  • Secondly, family members who held key positions were ill equipped to do their jobs. 
  • Lastly,  the owner unfortunately fell ill, and the company became rudderless 

Sales and profits fell markedly as the core and new business lines saw a steep decline. Here are the details: 

  1. Sales in their company’s core business initially grew 80%, before plateauing due to the labor shortage
  2. The new business equal to the core business sales in just 2½ years and doubled the size of the company
  3. Following all these problems, sales fell to where the company was at the beginning of the story 

 

  • This company started out as a franchisee operation, in a small town and in a small niche of a large industry. These situations vastly limited their growth and profitability. We helped move them to a larger market and a bigger market niche. After many years, however the owner decided it was time to sell the company. He wanted to first see if his son would be a viable option, which proved not to be viable. We then created a management buyout option (MBO) for their savvy sales manager and based the buyout price on the company’s market value, to be paid out over 4 years from the free cash flow. Here are some of the highlights:
  1. We moved to larger city with a greater market and new business potential increasing sales 8-fold in 7 years
  2. They exited the franchise agreement which increased their profits and enabled them to sell to company 
  3. They opened an office for the son but after 18 months, this proved he could not take over for his dad
  4. The sales manager leaped at the MBO. She ran the company as expected for a win-win for both parties 

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