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 Global producer of specialty minerals and Cost Reduction

Context / Scope of project

PIP was engaged by a global producer of specialty minerals to review its strategic position and portfolio of 30+ global assets. The business was profitable, but it was felt that some of the smaller assets may be sub-scale (although internal analysis of the decision to close any individual asset had always indicated that it was not economic to do so).

Outcome

PIP ensured that all the rationalisation activities proposed for the 12 months after the initial engagement were completed on time and to budget. The net impact on the business will (once the changes have been bedded down) be in excess of $50m per annum.

Client reaction

“PIP have been invaluable at helping us understand the true economic drivers of our business, optimising our asset portfolio and creating an actionable and practical plan to execute on this. Their ability to engage with senior management also ensured that the recommendations addressed stakeholder concerns and had the management onboard.”

VP European Operations

Key success factors

  1. The combination of strong consulting horsepower and seasoned professionals (with 50+yrs of management experience between them) enabled PIP to develop a radically different strategy, whilst rapidly formulating an actionable workplan that had the active support of the broader management team.
  2. In the subsequent implementation phase, PIP’s deep experience of successful execution enabled a much smaller team (2-4 people) to structure and manage an effective change programme.

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What we did:

PIP deployed a 6 person team in the US and Europe for an 8 week period to review the strategy of the business and make recommendations as to the structure of the portfolio. The team concluded that the client was not the natural owner of sub-scale assets, and that the costs of complexity justified a managed exit from roughly half their facilities over a 3-5 year timeframe.

The team quantified the upside opportunity and detailed the process for rationalising the assets using simple business cases, which were approved by all key stakeholders at a workshop prior to the end of the initial engagement.

The client recognised its lack of internal execution capability and retained PIP to support the transformation programme. In addition to providing a project management function that ensured closed loop accountability on delivery of the key activities, the PIP team also led the client in:

  • Confirming the succession plan for key assets to be closed
  • Developing a comprehensive customer migration plan
  • Preparing Information Memoranda for assets that were to be divested
  • Key negotiations with external stakeholders
  • Product line profitability analysis and SKU rationalisation
  • Identification of the key opportunities for business improvement at scale assets

 


 
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