A medium-sized German group in the technical services sector had entered the consulting business with IT services for cybersecurity and data protection. It had also acquired a start-up for security solutions (hardware/software) in order to accelerate growth. However, the new business did not meet expectations and had slipped significantly into the red. In addition, the differences between the rather conservative corporate culture and the start-up culture made collaboration difficult. These problems had already led to the departure of a number of top performers. The current interim manager was appointed as managing director to realign the company and lead it into the profit zone.
New service portfolio developed | consultants integrated into sales
In his analysis, the interim manager determined that the service portfolio was not sufficiently aligned with the requirements and needs of the key customer groups and, above all, offered few opportunities for cross-selling services and products. In an iterative strategy process with the managers, he therefore first revised the portfolio.
The next step was to address the consultants' sales mentality. The main aim here was to show how consulting and the sale of software and hardware could be better linked. Previously, the consultants (old company) had considered it a violation of their neutrality if they were also to offer products (from the start-up). In lighthouse projects with selected clients, the interim manager made it clear that the clients considered it compatible with neutrality if the consultants offered a handful of IT solutions, including those of the start-up. In fact, the clients even reflected that the pre-selection was welcomed. This also convinced the consultants to take on more serious sales tasks.
Business unit structure modernized and CRM system introduced
Based on the findings of the portfolio process, the manager then gave the subsidiary a new structure. Previously, there were two units in which service provision, product management and sales were bundled. He hived off sales from these units and structured a new joint sales unit to offer the revised portfolio of both units.
In order to make the central sales team fit for selling the integrated portfolio, the interim manager established a new key account management system. Intensive training and a new commission model made a significant contribution to promoting sales of the entire portfolio.
In order to improve coordination between the business units and central sales, he initiated the introduction of a new CRM system. This led to greater transparency for management and simplified day-to-day collaboration, for example through quotation templates, approval workflows, deployment planning, etc.
Improving capacity utilization and agreeing on variable remuneration
After setting the most important course for more sales, the manager was able to focus on further optimizing the earnings situation. Among other things, he improved capacity utilization management and the management of external service resources. After intensive discussions, the works council agreed to incorporate individual capacity utilization targets into the variable remuneration of employees in order to create the right incentives at employee level.
Return to growth and profitability | EBIT significantly improved
Thanks to his initiatives, the manager was able to return the Group subsidiary to profitability in less than 18 months. The EBIT margin improved by more than 20 percentage points. Overall growth amounted to more than 30 percent. After 2 years, he was then able to hand over the management to a new manager he had helped select.
