Experience

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To develop a Value Growth Strategy

Situation

  • The company combines more than 10 production facilities at which building, agriculture, mining and forestry equipment is manufactured
  • The company conducted a number of operational improvements, which allowed for profitability to be significantly increased in the different companies. However, the rest remain loss-making, significantly damaging the company’s financial results
  • The market’s rapid growth in recent years presented great opportunities for growth, while at the same guaranteeing the business’s long-term development against other market player’s increased capacities
  • The company’s business plan did not provide any focused direction for the firm to help it combat growing scarcity 

Goal

  • To identify the range of business growth options, evaluate their potential and possible risks
  • To develop a company strategy which to the maximum degree possible achieve the potential for growth  

Our approach

  • Conducted a detailed analysis of the market for equipment and technology; interviewed dealers and consumers of equipment to define market trends, client preferences, and the key success factors
  • Performed an internal analysis of the company: financial data, strategic and investment plans
  • Completed a strategy audit of the company at the corporate level and at the level of business units
  • To generate options for the corporate portfolio, we analysed the business models used by international leaders and defined the parameters that would provide the greatest stock market value, as well as conducting interviews with industry experts and the company’s management
  • For each business unit of the company, we provided a number of strategic options, made financial models for each alternative, and carried out valuations of the attractiveness of each alternative according to financial efficiency and implementation criteria
  • Based on the evaluations of the options for the different business units, we formed several portfolios for the entire company, identifying the financial attractiveness and ease of implementation in each portfolio

Results

  • Strategic development options for the company were identified, evaluating their ease of implementation and attractiveness
  • Strategies for the business units were developed, and a corporate portfolio to guarantee maximum growth in company’s value provided
  • An action plan to achieve the strategy was developed

 

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