Business Rescue and Recovery In A Challenging Economic Time!

1. Business Rescue and Recovery In A Challenging Economic Time! (Lean May Not Be the Immediate Answer) Tom Davis Lean BusinessInitiatives TomDavis148@Gmail.com LBI

2. What is Lean ? A systematic approach to managing business activities to generate the maximum return. Simply….. The Identification and Elimination of Waste!

3. Components of Lean • Training • Facilities Improvements • 7 Wastes • 5’s • Value Stream Mapping • Kaizen • Visual Processes

4. Typical Process Waste Process 90% of Lead Time is Waste

5. Value Stream Mapping • A simple and powerful tool to model specific, finite business processes. • The core activities: • Current Condition • Ideal Condition • Target Condition “5 Whys” --- & --- “YaBut’s”

6. Kaizen • What does Kaizen mean? • What is a Kaizen event? • What is the key benefit of Kaizen? If everybody makes just 1 improvement a day.. 100 Employees X 5 X 52 = 26,000/Year Incremental Approach …… Baby Steps!

7. Change Management • Roles Will be Changing • People Will be Nervous • Trust Will be Key • Training and Clear Communications • Lean Initiatives Are Not Optional

8. KPI Traditional Lean • Too Little Space • Cost + Profit = Sell Price • Planned Overproduction • Some Defects Acceptable • You Have All The Space You Need • Sell Price – Cost = Profit • Zero Over Production • Zero Defects

9. What is Rescue and Recovery? Depends on the Specific Situation • Operational Issue? • Financial Issue? • Product or Market Issue? Usually it is a Combination of Factors

10. Initial Intervention! • Stabilize the Business • Assess the Business • Assess the Management • Assess the Products Liquidity? CASH IS KING!

11. Assessment • Operational • Is the plant Safe? Environmental? • Are there systems in place? • Are they sufficient? • Is the Staff Capable? • Is the Plant and Equipment Adequate?

12. Assessment • Financial • Review • Income Statement • Balance Sheet • Cash Flow*** • Are There Financial Systems? • Are They Being Used Properly? • Are They Robust?

13. Assessment • Product and Market • Is the Target Market(s) Being Served? • Does the Product(s) Serve the Current Need? • Where is the Product(s) in its Life Cycle? • What is the Product(s) Margin? • Commodity • Engineered • Custom • What is the Perceived Value?

14. Assessment • Management: • Is the Staff Properly Educated and Trained? • Do They Have the Required Experience? • Do They Understand the Situation? • What are the Deficiencies? • Skills • Leadership • Urgency • Do They Have and Understand the Expectations?

15. SWOT • Strengths • Weaknesses • Opportunities • Threats

16. Recovery Plan • Tighten the Focus • Market • Operational • Fiscal Control, Fiscal Control, Fiscal Control Baby Steps…….Take the Gain!

17. Value Stream Mapping • A simple and powerful tool to model specific, finite business processes. • The core activities: • Current Condition • Ideal Condition • Target Condition “5 Whys” --- & --- “YaBut’s”

18. Organizational Expectations“They Go Both Ways” • Instill Honesty by Being Honest • Let Employees Know What is Going on & Expected! • Most Times They Already Know Better Than You Do. • Employees Want & Deserve to be Well Managed • Clearly Communicate Expectations • Verify that Employees Understand the Implications of Failing to Meet Expectations • Individually • Collectively

19. Change Management • Behaviors and Roles Will be Changing • People Are Nervous • Trust is Key • Training and Clear Communications are Pivotal • Rescue Initiatives Are Not Optional

20. Management Behavior • Do Nothing Immoral, Illegal or Unethical • Appropriate Transparency: • Financial • Suppliers • Selected Customers • Employees • Maintain a Positive Outlook but Don’t Underplay the Risks!

21. Comments • Recovery is a Management Process • Recovery Benefits from Transparency • Recovery Requires Functional Integration • Recovery of Business Performance Benefits from Visual Monitoring Questions Contact: TomDavis148@Gmail.com Cell: 508 496 7210