Client: Large producer of smaller, specialized ships, ship designs and ship equipment for the North European and World market. Group consisting of 35 company units. A family company with sales of close to USD 300 million.
Situation: Group and individual units faced tough competition from the Far East on large ships and increaslingly also on smaller ships built for special purposes.
Issue: How utilize Group skills on specialized ships, designs and ship engines, and how improve product/marketing strategies and financial results in Group and units?
Study: Business Strategy BSAG identified competitive strengths of each unit and entire group, plus current and significant potential profit contributions by company and segment. Identified weaknesses that should be remedied, and units/segments with too low potential for priority.
Findings: Key ship designs were highly advanced in world market terms although sold as designs only, not regularly in combination with own shipbuilding contracts. Further, large and smaller ship diesel engines lost world market share, but were atttempted sold without proper reference to key existing product advantages which we defined. Company units were ran with great independence and partly not cooperating well enough to maximize Group world market share. Group profits were substantial but could be improved substantially.
Solutions: Through targeted cooperation with unit managers, sales and financial people, and engineers, arrived at sound approaches to attack world markets more effectively and more profitably. For instance, focusing on own, advanced ship design to also help obtain shipbuilding contracts. And for the large engine company, to properly define existing product advantages which actually were beyond those of Far East competitors.
Implementation: All our recommendations were accepted and to 90% actually implemented during a short interval. Business Strategy BS AG was positively referred to in the Group’s next Annual Report.
Results: Given a new, clear impetus on both unit and Group performance, profitability increased rapidly and overall Group world outlook was substantially improved. This enabled top manager and key owner (at retirement age) to divest of most of the Group at a remarkable price. Decision was taken to maintain specialized shipbuilding, a relatively large company in the Group, for family business reasons. This was followed by substantial company growth and sustained profitability.