One Company’s Transformation
A global consumer-products company, which had once enjoyed a strong market position, was suffering sustained share losses across multiple sales channels. Its financial performance was declining in a relatively healthy industry and investors were losing patience with the management team.
A top-down assessment of the company’s performance and projected trajectory yielded a bleak picture. Compared with its peers, the company scored low on almost every aspect of organizational health: it was in the bottom quartile on several health dimensions, including employee motivation, innovation, and ability to execute.
But the management team was determined to find a way forward. In bottom-up planning sessions, the company’s executives and line leaders developed initiatives focusing on three cost levers (external spending, supply chain, and overhead) and three revenue levers (field sales, marketing, and alternative channels). Initiatives included a redesign of the supply-chain network, new pricing guidelines, an overhaul of the company’s e-commerce site, reconfigured sales management, and a revamped performance-bonus structure for salespeople.
The company immediately established a performance infrastructure, with the three components outlined in this article: a transformation office led by a skilled chief transformation officer, a weekly cadence of meetings, and a set of common tools that made it easy to gauge each initiative’s progress and results.
The impact of the transformation was significant: dramatically reduced costs, trend improvements across markets, and the development of new skills in important segments. The company now has a solid foundation for growth and resilience.