Defining and Implementing the Corporate-Banking Business Strategy for a Large Bank
A large French bank wanted to overhaul its corporate-banking activities. After calling in Burk to help formulate a global strategy, the bank asked us to detail all the implications of the new action plan and to help adapt the organization.
The consulting team, collaborating closely with client team members, set to work on supporting a deep transformation of the bank’s structures, mechanisms, and procedures, with a strong focus on the mobilization and engagement of its staff.
Two major objectives were set:
- Elicit the staff’s agreement on the soundness and relevance of the new strategy, and, together, define the broad outlines of an appropriate new organization.
- Adhere to the agreed-upon principles, while showing great flexibility in response to on-site constraints, and maintain a productive dialogue with all those involved: network manager, corporate-relations manager, and local functional (marketing, human resources, etc.) and operational managers.
The project was divided into three main phases over a 7-month period. The consultants’ immersion into the bank’s environment allowed us to help define the new organization to the smallest detail. Most important, it facilitated a dialogue that helped in persuading, rallying, and engaging the stakeholders. The team was comfortable that all the conditions for implementation were met, allowing it to prepare the migration plan with precision.
In essence, the Burk team worked as an intermediary between the group’s different members. We were the catalyst that allowed ideas to emerge, and then assisted in their fine-tuning and tailoring. Further, our activities were concentrated over a relatively short period so as not to destabilize the organization.
Transforming IT into a Revenue Stream
Facing adverse market conditions, escalating production costs, a deteriorating subscription base, and decreasing advertising revenues, a print-media company wanted to develop a quick cost-reduction plan. But the company also wanted to preserve capacity for growth over the medium and long term. It asked Burk to help it make IT operations more efficient and effective.
Burk created a joint team for the project, bringing consultants with industry experience from our Media Practice together with technology specialists from our Business Technology Practice. The team’s initial analyses revealed that rather than cutting costs the client had an opportunity to add a new dimension to the activities of the IT department. This would enable the department to sell services outside of the parent company. After persuading client executives of the concept’s value, the scope of the consulting project was redefined. The objective became to reposition IT systems to have a strategic position within the company and create opportunities for new revenue streams. The engagement had three stages.
First, the Burk team worked closely with the client to analyze the current state of IT systems: alignment with company strategy, financing, organization, infrastructure, applications portfolio, etc.
Second, the team developed recommendations for changes that would be required to support the repositioning. The organization and its processes were rethought to enable the company to fully exploit the potential of its IT systems. Instead of acting as a support function, IT had to become a strategic imperative.
The third phase was implementation, with a focus on managing the human dimensions of change. Client teams were trained and guided to envision themselves delivering concrete solutions to attain the agreed objective. Project-management skills were built to support lasting change.
By the end of the project, the Burk team had helped the client to develop an agreed-upon, well-defined objective, a means of realizing it, and momentum which produced tangible results within the first few months. For the client company’s staff, the need for cost cutting was avoided and their status in the organization was enhanced.
Merging Two Formerly Competing Manufacturing Entities
Few economic adventures are as risky as merging two former competitors. The work entails making sure that the resulting whole is more than the sum of its parts, creating a shared future vision, and producing the dynamic needed for it all to work. At any given moment, the human element can get in the way of plans which, on paper, appear perfectly realistic. Burk was invited by two heavy-industry firms to tackle this delicate task.
To begin with, we confirmed the project’s rationale. Three or four months of investigation and analyses were needed to explore the possible synergies, imagine a common purpose for the two companies, and present them with the reality of the various issues at stake.
Once the two parties approved and accepted the project’s purpose and rationale, the time came for action. They had 16 months to transform the vision—the shared ambition for a successful merger—into reality and to strengthen it by uniting the advanced skills, IT systems, customer portfolios, expertise, values, and energy of both companies. This meant that we had to define the new organization and its operations in great detail—a genuine intellectual challenge that also called for deep expertise in operations improvement.
We then dealt with the merger at a practical level. Our main role was as facilitator: not only motivating, guiding, encouraging, and, when necessary, reassuring the employees but also clearing up misunderstandings and defusing personal conflicts at all levels of both organizations. We had to support each of the managers concerned—50 on each side—helping them understand their new roles, see how these would interact with those of their counterparts, and fully exploit all the merger-related improvements and synergies.
The process took an entire year to complete and enabled the implementation of the different associated action plans. The merger of the two companies was a resounding success. It also planted a seed: a few months later the two groups, satisfied with their shared experience, decided to merge. But that is another story.
Rationalizing Stock Management in Retail
Product availability is a key lever in customer satisfaction, as well as in sales. But can management increase product availability while lowering stock levels and allocating more staff time to customer contact than to supply management? That was the question posed to Burk by a major retailer in Europe.
We proposed to implement an original operational improvement plan—first in a few stores and then rolled out to the entire network. The idea was to take the lean techniques that have proven successful in manufacturing over the past 30 years and apply them to large retail outlets. The method’s general principle is to eliminate muda—waste in all forms—by asking the operators themselves to identify improvement opportunities.
The initial diagnosis confirmed the value of our approach. In the stores studied, the staff spent over 60 percent of their time shelving or labeling products and only 15 percent helping customers. Because of delivery delays and errors in the supply chain, a number of articles were out of stock. At the same time, the store was overwhelmed by surplus stocks—often piled up in the halls or stuffed in overfull stockrooms, where they deteriorated.
Our teams set about tackling the main sources of muda: sales-forecasting errors, supply-chain problems, and organizational issues. By installing one-piece flow orders and reviewing relationships with suppliers, management managed to cut stock levels and stockout rates. More flexible planning and task simplification increased sales-staff availability and significantly diminished checkout waiting times. Finally, we helped management cut down on non-value-added operations, tackling the poor storage conditions, damaged or past-use-by-date products, redundant checks, and unnecessary maintenance work.
Driven by the lean manufacturing spirit, this approach got all of the staff involved in the search for improvements. The attitude prevailing in the stores clearly shifted toward better customer service and the continuous quest for operational excellence.