Portfolio reshaping at a drilling equipment co.
After a prolonged industry downturn, a global provider of exploration drilling services and equipment was realizing new growth, but not the improved profitability it anticipated. Surviving the downturn meant aggressively going after new markets and introducing new products and services. When the market turned for the better, revenue was more widely distributed than before and previous scale efficiencies were lost. When efforts with another consultancy failed, WP&C was called in to take a fresh look, provide actionable insight, and help the company regain profitability.
The company had adopted a strategy of becoming a ‘one-stop-shop’ for drilling equipment. Aiming to satisfy demand for all needs often meant engineering products of which only a few units were produced for a single customer. This resulted in a massive expansion of the product portfolio which ballooned to more than 90,000 active SKUs. With manufacturing across six centers worldwide and a global distribution network—cost, inventory, and customer service levels suffered from the additional complexity. It was no longer evident which segments or products were actually making money and cash flow suffered. Immediate improvements were demanded.
WP&C embarked on a two-phase program. First, they assessed the performance of the company’s products business at
With a new view of performance aligned with the company’s strategy and value proposition, the team provided a plan to drastically reduce costs and improve profitability. This included transforming the company’s product offering and how they would deliver it. Recommendations included:
WP&C challenged the company to rethink critical aspects of their business in order to gain more meaningful and sustainable profitability. They offered insight into offerings, pricing, manufacturing and inventory deployment strategies, and customer service policies. Cost reduction would not come through a single action, nor by functionally-focused efforts—concurrent actions would be needed. WP&C made clear recommendations and worked with the company to develop specific solutions down to individual product and customer levels, evaluating technical and commercial feasibility. Results included:
The company had adopted a strategy of becoming a ‘one-stop-shop’ for drilling equipment. Aiming to satisfy demand for all needs often meant engineering products of which only a few units were produced for a single customer. This resulted in a massive expansion of the product portfolio which ballooned to more than 90,000 active SKUs. With manufacturing across six centers worldwide and a global distribution network—cost, inventory, and customer service levels suffered from the additional complexity. It was no longer evident which segments or products were actually making money and cash flow suffered. Immediate improvements were demanded.
WP&C embarked on a two-phase program. First, they assessed the performance of the company’s products business at
With a new view of performance aligned with the company’s strategy and value proposition, the team provided a plan to drastically reduce costs and improve profitability. This included transforming the company’s product offering and how they would deliver it. Recommendations included:
WP&C challenged the company to rethink critical aspects of their business in order to gain more meaningful and sustainable profitability. They offered insight into offerings, pricing, manufacturing and inventory deployment strategies, and customer service policies. Cost reduction would not come through a single action, nor by functionally-focused efforts—concurrent actions would be needed. WP&C made clear recommendations and worked with the company to develop specific solutions down to individual product and customer levels, evaluating technical and commercial feasibility. Results included:
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Lorem Ipsum Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud.
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