Case Study 1
The company was experiencing a downturn, revenue declining from over $52 million to $36 million and gross margin shrinking from over 50% to under 40%. The core business was declining. The stock price of the company had declined from a high of $24 to a low of $3.50 within two years.
In addition, the company was trying to cope with the aftermath of a 25% reduction in workforce and was having difficulties executing day-to-day business activities. Morale was at an all-time low. Change in direction was needed.
The company needed to understand its strengths and weaknesses, the present and future market and business opportunities and threats. This information was vital to making an intelligent assessment of the future. The goal was to insure the company would survive and thrive in the long run.
We organized and facilitated a strategic planning process, working closely with the CEO and COO, key employees, and board of directors. The first action was to identify corporate issues, both present and future. Our task was to do the background research, analysis and assessments. We conducted internal and external interviews of key stakeholders and assessed the company’s strengths and weaknesses. We performed a competitive analysis; we researched and evaluated market and technology trends and opportunities.
Once the research stage was complete, we created a “straw man” business plan of various strategic business options. With a straw man strategic plan in place, we began the formal strategic planning process with the rest of the senior management team. We presented the straw man, and facilitated the conversation for the group in evaluating technology and market trends and opportunities.
At the end the planning process, we compiled and created a coherent strategic plan, which included a new product planning process. We presented the plan to the board and to the employees.
The company not only survived its crisis, but also was able to revitalize itself by defining new markets, products, and businesses. The company went from declining sales of less than $35 million to growth of over $50 million. With a strategic planning process in place, the company became proactive and less reactive to market changes. They now have a process they can rely on to plan for the future.