Situation
The finance department of a manufacturing company was focused on accounting transactional work that was historic in nature. The close process was so significant that data was not available until 1 ½ – 2 months after the period and was not distributed beyond a few key executives. Data was typically presented in great detail, and was not understandable to those that did not produce it. Those that saw the data generally questioned the integrity and did not find it useful for making decisions.
Solution
Focused on key drivers of the business, simplified and automated systems, eliminated non-value added processes, instituted materiality, implemented budgeting and review process, engaged key managers in review of results before close. Skills and capabilities gaps were closed through key hires, roles and responsibilities were outlined and people were taught about the operations of the business.
Results
- Headcount was reduced by 1/3
- Close time was increased from 6 weeks to 2 days
- A standard reporting package was distributed to all management
- Margin by product, by customer was reviewed with sales and operations monthly and utilized to substantially increase earnings
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