This PDF gives a brief overview of how we operate to create measurable value; followed, more importantly, by a case study demonstrating results in the first half of 2009.
3. ForteCEO
Who We Are
• ForteCEO is a boutique consulting firm.
– We implement profit improvement and turnaround action plans for middle market
companies
• The difference is our people
– Each ForteCEO Executive has over 20 years of proven success in leadership roles.
– ForteCEO Executives are all A+ caliber proven business leaders
– They are industry experts with the functional skills to assist businesses succeed.
• After assessing the needs of the company ForteCEO works along side the
internal management team to implement change and assure the
improvements will be sustained long after Forte leaves.
• We implement lasting sustainable strategies that quickly impact the
bottom line.
4. ForteCEO
What We Do
• We specialize in manufacturing, consumer products and
service industries. Our clients are business owners and
private equity firms.
• A ForteCEO engagement typically lasts from 3-6 months
and begins with an intensive period of analysis followed
by implementation.
• ForteCEO engagements yield outstanding ROI
5. ForteCEO
How We Do It
• We customize our approach to the needs of each client.
• ForteCEO Executives are all A-caliber seasoned business leaders.
They have deep industry and functional expertise to match the
needs of our clients. They are CEOs, Presidents, COOs, CFOs
and Functional Specialists.
• The experience and caliber of our Executives allows us to quickly
analyze your company and create a custom approach to fit your
unique culture and needs. Our recommendations are actionable
and sustainable. They don’t sit on a shelf after we leave.
• Clear goals and metrics are set at the beginning of the
engagement and updated monthly. The firm’s partners monitor
progress and collaborate with the consultant on a regular basis.
6. ForteCEO
Case Study
• GiftCo Company Timeline
• Initial Situation Analysis
• The ForteCEO Change Strategy
• Actions Instituted
• Results
7. Case Study
GiftCo Company Time Line
Private Equity Firm purchased GiftCo in November 2007
As of August 2008
• YTD Revenues: Down 34%
Mezzanine Lender introduces ForteCEO
• ForteCEO Engagement
• Phase I: Assessment Process begins October 2008
• Phase II: Implementation begins November 2008
8. Case Study
Initial Situation Analysis
GiftCo Company Strengths
• Licensing competency – excellent reputation in industry
• Licenses act as brand - retailer cannot source elsewhere, cannot source themselves
• Overseas sourcing competency
• No quality issues
• No serious delivery issues
GiftCo Company Weaknesses
• Insufficient sales infrastructure
• Product driven, but new product development process/strategy in need of
improvement
• Lack of disciplined inventory control
• Insufficient market intelligence
• Internal successor CEO inexperienced
9. Case Study
The ForteCEO Change Strategy
Previous Current
Function Licensing Competency / Sales & Marketing Competency /
Product Orientation Profit Orientation
Based on marketability, saturate the market place with
Develop appealing licensed product
Mission purchased by giftware retailers
appealing licensed product targeted to specific channel
segments to maximize distribution
Use aggressive, experienced sales people, reps, and
sales managers to execute a national account and
Sales Use catalogs to entice customers to buy independent dealer channel strategy. Measure sales
performance monthly against annual goals and prior year
sales (targeted, pro-active)
Maintain good working relationships with licensors but
License (Brand) Maintain good working relationships with partners with them on events, promotions, and targeted
Management licensors to promote their interests customers to promote GiftCo Company products while
promoting the license
10. Case Study
The ForteCEO Change Strategy
Previous Current
Function Licensing Competency / Sales & Marketing Competency /
Product Orientation Profit Orientation
After market analysis of pricing elasticity for licenses and
Control minimum profit levels by using a
Pricing pricing formula: 4 X product costs
products, maximize profitability by pricing product based
on what the market will bear, not on a set formula
Create an annual product development Track and analyze sales and profitability by license and by
Inventory Control schedule and periodically retire under- SKU. Maintain a set SKU range with disciplined pruning:
performing licenses and SKU’s one drop for every add
Create comprehensive new product development and
Introduce new product at shows and via launch strategy by license, including targeted account
New Product catalogs schedule, packaging, sales materials, and displays.
Establish new product sales goals and track monthly.
11. Case Study
The ForteCEO Change Strategy
Previous Current
Function Licensing Competency / Sales & Marketing Competency /
Product Orientation Profit Orientation
Clear organizational structure defined; roles held by
Organizational Post founder exit, lack of clarity / competent, experienced associates who are given
Structure leadership adequate training, guidance, and feedback based on pre-
determined, objective metrics (Clarity)
Establish critical sales and profitability goals. Using a
formal strategy deployment process, cascade goals
Focus on gaining new licenses and
Leadership creating new products
throughout the organization, assign metrics, and track the
execution of those goals in monthly management team
building meetings and monthly Company-wide meetings
12. Case Study
Actions Instituted
Immediate Expense Reduction & Financial Controls Initiatives
• Headcount reductions (warehouse and office)
• Suspend company 401K match
• Eliminate March catalog
• Create and distribute departmental budgets; monthly accountability
• Unrelenting attention on customer credit worthiness and on receivables
Inventory Reduction Initiatives
• Deep data dive to create meaningful statistics
• SKU rationalization - 70 SKU’s have been eliminated and 434 SKU’s reclassified
• Severe discipline applied to June introductions (209 in June 2008 vs. 20 in June 2009)
• Creation of Inventory Reduction Team meeting monthly and deployed against on-going
Action Items
• Sales focus on “Dollar” type discount stores where allowed by License Agreement to
quickly close out slow moving and obsolete inventory
13. Case Study
Actions Instituted
Sales Initiatives
• Deployment of a Channel Strategy to maximize sales through expanded distribution
• Created two sales divisions: Specialty and National Accounts
• Complete account re-alignment, independent rep evaluation (contract changes)
• New hire: experienced Director of National Accounts in place January 1, 2009
• Created a Focused New Customer Initiative (Walmart, Target, and beyond….)
Organizational Initiatives
• Re-deployed former CEO to previous role in Licensing and Marketing
• Hired new Director of National Accounts, Asst Controller, and Supply Chain Manager
• Rationalization of organizational structure
• Search for permanent CEO – 3 “finalists” to be interviewed week of May 11
14. Case Study
Actions Instituted
Culture Change Initiatives
• GiftCo Company is moving toward a data driven, metrics-oriented organization --
all associates are aware of our goals and our progress toward achieving them
• GiftCo Company now utilizes visual management; a strategy deployment process
is in place, and performance charts are publicly posted monthly
• Communication is open and frequent
• GiftCo Company is now a strong sales and expense control culture moving
towards being a strong sales, profit, and marketing culture
15. Case Study
Results
Improved operating performance
• April 2009 Revenue: 19% over plan and 34% over April 2008
• April YTD Revenue: 4% above Plan
• Orders in February, March, and April 2009 exceeded those months in 2008 by 7%,
45%, and 38% respectively
• Operating Income for Q1 exceeded Plan by 46%
• Net Income for Q1 exceeded Plan by 20%
16. Case Study
Results
Sales infrastructure established
• Several new key accounts added in both Sales Divisions New National
Account reps hired to pursue key accounts
• Programs in place or pending for new National Account additions in Q4 or
sooner
• Actively pursuing new business for Q1 2010 that would ship in Q4 2009
Organizational Change
• Compared to March 2008, headcount has been reduced by 16 or 39%
• 2009 Q1 Operating Expense is 14% below 2008 and 9% below Plan
• Search for permanent CEO entering final phase with goal of new hire in June
On-hand orders shippable in May and June are strong, anticipating achieving Plan and
exceeding 2008 revenue in both months.