• This Division is part of a $6 billion electronics firm.
• Designs and manufactures semiconductors for sale around the world.

• Shift in customer base from being primarily in the US to Europe and Southeast Asia.
• Intense global competition in two areas:
  • Price. This required finding a way to radically reduce the cost of producing product.
  • Customer Service. This required locating manufacturing facilities closer to customer locations.

• The Division’s response to this competitive pressure was to design a “factory of the future” which would produce a product at a cost that would be competitive for the next ten years.. The process followed was:
  • Feasibility. Given a cost per unit goal, a special task force, assisted by PDL staff, designed a “macro” organization system that would meet that goal. The design included processes, organization structure, staffing and management system. This design was ruled to be “feasible” by Division management and the project moved to the design phase. Elapsed time for the feasibility phase was six weeks.
  • Design. Detailed design of the facility was completed in six months.
  • Implementation. Facility was built in Malaysia and concept implemented in 18 months.

• New factory was world-wide leader.
• Subsequently, a price war broke out in this segment of the semiconductor market. Had it not been for this new facility, this division would have gone out of business.

Back to top

LCI Transformation Case Study

Background

• Start-up tele-communications company
• Had grown from $30 to $100 million in three years
• Projected growth to $300 million in next three years.

• CEO concerned about:
  • Need for an organization infrastructure that would support the planned growth.
  • Need for quick response to changes in the external business environment.
    • The ability to identify changes in the external business environment
      • Changes in industry relations
      • Changes in the offerings of competitors
    • The ability to respond quickly to these changes
  • Need to improve customer service
    • Internal processes struggling to provide the minimum level of service required to compete.
    • Intense competition, with new customer service and cost expectations being set every day by competitors.

• Over a three year period, PDL staff assisted the company in the implementation of the following major initiatives to move the organization toward operating as an “adaptive” system.
  • Conducted a high-level “organization system analysis” with the senior management team to identify fast growth “stress points” in the organization system.
  • Redesigned core corporate processes to handle the rapid growth and improve customer service.
  • Developed ad “green field” field sales and service organization complete with
    • Organization structure
    • Business processes
    • Management processes
    • Measurement system
    • Training

• The redesigned infrastructure supported growth from $100 to $300 million over the next three years.

Back to top

Sherwin-Williams (Stores Division) Case Study

Background

• 1400 store retail chain
• Nearly went into Chapter 11 two years before project commenced.
• Two years of extensive cost cutting to return to positive cash flow.

• Growth. Now that the organization case situation was stabilized, there were two primary reasons to shift the emphasis to growth:
  • Regain market share which had slipped during the crisis.
  • Improve profitability and return on net assets.
• Highly variable performance of stores, not necessarily linked to market.
• Need to implement a major shift in strategy, which included expanding the product line and entering the wholesale market.

• Conduct Organization Scan
  • District Level and 135 District Managers key to implementation of the new strategy. New strategy radically redefined District Managers job.
• Design and implementation components of a “performance infrastructure” to support the new strategy and growth plans, including:
  • Roles and Responsibilities necessary to support new strategy.
  • District Level Performance System
    • Identified, redefined key processes
    • Job Models for District Managers and District Staff
    • Measures – Stores and Districts.
    • District Planning System
    • Performance Management System
    • Outside Sales and Outside Sales Management Systems.
  • Store Manager Training and Development System
    • Store Processes
    • Learner Controlled Instruction Training Model
  • Store Management System

• New strategy successfully implemented.
• A major economic recession occurred following implementation. However, Sherwin-Williams Stores Division sales did not decline and they regained market share, which they attributed to having the new Field Performance System in place.

Back to top

Products & Services | Workshops | News & Publications | About PDL | Case Studies | Lab Blog | Contact Us
Copyright © Performance Design Lab 2006 • Website by Advance Design Interactive