Assignment 21. 2005-2006
XYZ GmbH / Services and sales of health care products
CEO (General Manager. Client was the parent company, listed on the stock exchange)
Turnaround. Improve the profit margin from -20% to a more stable figure while continually improving the profit trend. Grow the shareholder value by 60 million € in 18 m
The question here was: Are we a vendor or a service provider? The question had remained unanswered while an attempt was undertaken to grow the business in hopes of achieving ‘economies of trade’. The question of which regions to serve had not been resolved nor was there a clear strategy for cooperating with the parent company. There were also substantial financial obligations from the past that weighed upon future profitability without contributing anything to the business. The latter problem was dealt with first. It required no strategic action but rather, just addressing some unpleasant tasks. At the same time, we developed a complementary product and regional strategy since neither one could stand alone. Unprofitable businesses were discontinued with the result that the company emerged in good shape with a clear lineup of products and services.