Magyar Interim management case studies
Autóipar – struktúraváltás"Beugró" gazdasági igazgató
Removal of a factory
"Flying financial manager"
Calm maternity
Ratiopharm Hungária Kft
BorgWarner Turbo Systems Kft
Csősz Kft
Nypro Hungary Műanyagtechnika Kft.
Schiller Autóház Kft., Budapest
Managing Director: Gábor Schiller
The assignment involved the followings:
Schiller Kft. has gone through significant growth in the last few years, but this growth was not always accompanied by simultaneous improvement of the structure and operation of the company. At present the group is engaged in the sale and servicing of four brands of vehicles and intends to continue its activities at an even higher standard. At the same time the new EU regulations present further challenges for dealers and service providers of cars. The owners of the Schiller group of companies realized the peril and wanted to face the challenges. They decided to manage the problem with the participation of an interim manager.
What they needed was an interim manager who, having the proper skills and experience, is able to change - according to needs and successfully - the organization system and operation of Schiller Kft. and to increase its competitiveness.
The task was undertaken by Hungarian Interim Management Kft. (HIM). HIM provided an interim manager who was in possession of the experience required for performing the task, who in this case was personally one of the founders of HIM, Mr. László Steiner. HIM - in compliance with its quality assurance system - also provided a project manager for the term of the agreement, who followed up the fulfilment of the tasks laid down in the contract and had monthly consultations with the Employer in order to make the project successful.
The tasks performed by the interim manager were basically the followings:
- reshaping of the organizational structure in order to make the firm a "flat" organization;
- reorganization of the financial and controlling processes;
- elaboration of the operational parameters of the organization and the methods of measuring them.
At the same time a new overall system of calling to account, reporting and controlling was introduced. The new system enabled the owners and managers of the company - in addition to a daily review of the tasks performed - to see the effects of their decisions and work on the results, and to measure elements that were formerly known just as estimates.
The new structure also required the introduction of a new system of responsibilities, decision-making, reporting and settling of accounts. The managers' competence had to be reviewed in view of the new challenges. In function of the outcome of the reviews, decision-making became necessary in respect of keeping former managers, the trends to be followed in training and further training and the change of managers on a qualitative basis.
In harmony with the organizational structure, a new system of parameters and calling to account had to be elaborated for each managerial level Part of the system was calling to account by and reporting to the owners.
Simultaneously, the system of wages, premiums and benefits had to be reviewed and changed in order to increase the profitability of the company for the short and the long run. The system of measuring and calling to account had to be made part of the controlling system because reports had to be based on non-manipulated and reliable data gained from the management system of the company. Proper staffing for up-to-date controlling had to be ensured, as well as the wide-range and disciplined use of the integrated system of information.
The operation of the material management system had to be reviewed as well. Based on the outcome of the review, measures had to be taken in order to achieve the following goals:
- a significant increase in the speed of material replacement, at least by 50 percent;
- as a result of introducing the new system of responsibilities and the system of measuring, the efficiency of operation became measurable and it is expected to increase at least by 5% within a year.
By eliminating the activities not having key-importance, costs efficiency has improved. It was also necessary to elaborate and efficiently operate a quality insurance system covering the entire operation of the Schiller group of companies. The purpose was to make the principles of "do it well at the first time", internal control and continuous improvement prevail, in order to eliminate costs arising out of unnecessary controls and avoidable repairs.
Expressz Magyarország Rt.
CEO: Zsolt Szokolay
Interim Manager: Csaba Zsigmond
The Trader Classified Media Group that also includes Expressz Magyarország Rt., has acquired the publisher of Kisokos Directory publications. As a result of certain problems that had arisen during the merger, substantial changes had to be made in the management of Kisokos, and the filling in the post of finance director by a permanent staff member was delayed. Therefore a decision was made to fill in the post temporarily by hiring an interim manager.
The assignment involved the following fields:
Performance of the financial tasks related to the business activity of Kisokos; consultancy, with the participation of persons having the required expertise. Obviously, only such persons could come into the picture who had enough skills and experience to perform the tasks - properly and successfully - related to the financial and economic management of Kisokos for three to six months in compliance with Kisokos' needs.
The duties of the interim manager basically focused on the following areas:
- Operative management of Kisokos' daily financial tasks;
- Adaptation of the standards of the owners to Kisokos; organization of the financial systems and processes, including the standard reporting system and the establishment of the financial processes and financial system of Kisokos;
- Setting up of Kisokos' independent financial system, and as part of the job, to make preparations for the complete handover of the work to the final financial director.
The interim manager has performed all of his duties perfectly, which was also proved by the fact that his contract was extended by the Assignor for a further period of few months.
Removal of a factory
It happened in the United Kingdom. One can well imagine how much problems it might cause if the supplier of a Boeing 747, that values more than 100 million English Pounds, falls in delay. The English company at issue 'has grown out' of its manufacturing site and the new location it had chosen was a couple of hundred miles away from the old one. The management of the company realized the perils involved in moving the factory including the risk of losing their most significant customer. It also became clear soon that the company had no expert of its own specialized in removal. The management could also clearly see that it would present a great risk if they assigned the job of removal to the project manager of the company, who was otherwise an excellent organizer, but had never participated in similar projects before. Finally, they decided to employ an interim manager for the implementation of the removal. In fact, they had no other choice; no company can afford to keep an expert in reserve for a special occasion such as the moving of a whole factory. So they contacted a well-known interim management firm and provided it with the description of the project. After having studied the job carefully, the interim management firm offered several candidates for the performance of the job within a few days. Finally, Mr. Peter Smith was selected as he had the necessary experience and pronounced project manager faculties and had been participating in the performance of similar projects for 25 years in Europe, Asia and Australia, especially for blue-chip companies. Mr. Smith soon turned up at his working place, and, to the management's greatest surprise, it took him only a few days to understand the special function of each division and factory unit and to prepare the schedule of the removal. Mr. Smith, with a newcomer's eye, could detect all anomalies that the people working at the company could no longer perceive in the course implementing consequent austerity programs. As Mr. Smith kept telling them: "As a project manager coming from outside, I have the faculties to become an integral part of the company within a short time and to prompt the management and the workers to co-operate. However, it does not mean that I can overlook the shortcomings I have revealed in the company's operation." The removal went on smoothly and did not cost more than planned. Boeing, the biggest customer of the company, congratulated its supplier. The letter of congratulation stressed that the expertly implementation of the removal had further increased confidence in the supplier. Next year, at the time of deciding about acquisitions and the customer judged suppliers' offers, secure supply was a decisive factor in awarding the tender to the company at issue.
"Flying financial manager"
When a firm is about to 'fly away', it is the time for the 'flying financial manager' to come and to make efforts to keep our feet on the ground.
When a company wants to increase its sales return from 3 million Euros to 70 million Euros within 3 years, such a dramatic growth changes the role of its financial manager.
The company at issue - let us name it 'Sunflower Ltd.' - is engaged in the supply office furniture and provides full-range services with a pronounced emphasis on high-tech. Sunflower Ltd. faced the situation described above at the end of the 90's. The company successfully survived the recession of the industry in 1989 and 1990, and, during the subsequent boom, it won tenders for more and more complex projects that required much more skill than their former practice was in the field of finances and complex planning.
Former tasks did not require more than the employment of a part-time financial manager, who concentrated mainly on precise book-keeping and cash management. The new tasks called for a financial manager of higher caliber. However, since they were only at the beginning of the upward trend in business, Sunflower Co.'s management and chief executive officer did not want to take too great risk by employing a full-time financial manager with high salary, although the need for such a person was growing from day to day.
Then they found the right solution; the person they needed was an interim financial manager. Interim Management, together with the responsible managers of Sunflower Ltd., defined the task to perform and the qualities of the person required. Within a few days, Interim Management found the right candidate. Mr. Eugene Griffin, who was known by the profession as the 'flying financial manager' - as he had earned his fame mainly by acting as an interim manager - had plenty of experiences in financial planning and controlling of growth targeted projects, in managing company growth and in the implementation of international transactions. Mr. Griffin signed a contract for a definite period of 3 months. The effects of his work could already be felt in the second month and the volume of orders increased exponentially. The extension of Mr. Griffin's contract by another 3 months became a must.
By the end of the 6th month, it was clear that the company had achieved the planned rate of growth and that there was need for a full time financial director of high caliber. Since Mr. Griffin earned great respect at Sunflower Ltd., the management decided to offer him the post of full-time financial manager. To their great surprise, Mr. Griffin thanked for the confidence put in him, but refused the offer, because he wanted to continue his carrier as a 'flying financial manager'. The management of the Sunflower Ltd. also realized that it is flexibility, objectivity and independence that make interim managers capable of facing great challenges successfully, namely the lack of any former personal records and involvement in the internal corporate matters of the company helps them to concentrate solely on the achievement of the targets and this is what makes them so efficient. After having found his successor, a full-time financial director, Sunflower Ltd. gave a small farewell party in honour of Mr. Griffin and, encouraged by the good experiences gained, they still regularly use the services of interim managers.
Calm maternity
The branch manager of one of the Hungarian based international companies happened to be a woman. She was successful, enjoyed her work and she and her colleagues made up a very good team. Time passed by and Judith wanted to have a child. But what about her job? She did not want to give it up because she was at the peak of her carrier and found it improbable to find another job with similar challenges after the performance of all duties accompanying motherhood.
What did she do? She decided that in case the child was born healthy, she would go back to her work as soon as possible. She agreed with her superior that already in the second month following birth giving she would go back to work for a few hours daily, and later, from the fourth month on, she would continue working as before. In order to be able to do so, she asked for the help of the grandparents, hired a nanny, etc.
When her time came, she rushed to the hospital from her working place, and from her bed in the maternity ward she still made some official telephone calls that could not wait. Everything happened as it was planned. Judith gave birth to a healthy little girl, and, already in the fourth month following birth giving, she focused solely on her work again and worked with full blast.
Few years later, when she learned that she could have hired an interim manager for substituting her in the job of branch manager, she was really upset. She confessed that she had missed a very important experience of life; she did not spend enough time with her baby to see how her intelligence develops and could not give her as much motherly attention and care as the little new-comer would have deserved.
'If I hired an interim manager I could have been sure that I would not lose my job. The contracts of interim managers are concluded for a definite period of time and for a definite task. Besides, if I myself selected the interim manager, I would have taken great care to choose a good expert of the trade, someone good enough not to make our customers feel my absence.
Next time, instead of a nanny, I will look for an interim manager' - she said.
Ratiopharm Hungária Kft.
Managing Director: Mark Baumgärtner
Budapest
A consultant on human resources of good reputation recommended to Ratiopharm Hungaria Kft. that, while it is looking for the suitable CFO, it should use our interim management services.
We concluded an agreement about the service, then began the work without delay, because the former CFO had already left the company and Ratiopharm were forced to ensure the year end closing and reporting for 2005, for which Ratiopharm did not have well-prepared financial expert and it was clear that the search, introduction, decision and the engaging might last some months.
Both companies - Ratiopharm and the consultant on human recourses - helped us to outline the task and form the profile which is the closest to the expectations of the principal. We met the German managing director of the company, Mr. Mark Baumgärtner, and this meeting finally designated the scope of selecting the interim manager. Based on it, our data base and our consultant selected 8 interim managers from the system. We introduced the task to all of the 8 colleagues - in the first round without naming the person of the principal -, then we cut the list because of language problems and other occupations, to 4 interim managers.
The curriculum vitae of the selected candidates were sent to the general director, who selected two candidates from the list for a personal interview. Both candidates had the required practice, sufficient knowledge of the language and the reporting systems required at international companies.
The personal interview unanimously supported Csaba Zsigmond, interim manager and his person was accepted by the general director and our consultant as well. On the first day following his selection our candidate started to implement the task.
Csaba Zsigmond had little time to learn about his scope of work, since - as it became clear from the above -, he had to make the closing of the previous year and the necessary concern report until deadline.
Finally, our assignee supported Ratiopharm for 4 months. In the last week his job was to hand over tasks in detail to the Head of Finance and Administration, who was employed for the position. At the closing meeting the general director of Ratiopharm expressed his personal thanks for succeeding to close the previous year without problems.
We attach hereto the thanking letter of the German managing director, which he handed over to Csaba Zsigmond at the completion of his work.
BorgWarner Turbo Systems Kft.
Oroszlány
The Assignor contacted one of our Partners with the problem that their chief accountant all of a sudden left the company, and the end-of the year closing and the increased activity of the company presented greater complexity and load for the accounting department and the economic manager.
Therefore, until the new permanent chief accountant was found and started working, they wanted to make use of interim management (chief accountant) services.
We met the economic director of the company and in the meeting we agreed on the scope of the task and the targets. Then, our data base and our consultant selected 3 interim managers from the system, but it was obvious at the first look who was the most suitable candidate.
The curriculum vitae of the selected candidate was sent to economic director who summoned our candidate for an interview without delay. The personal interview brought about positive result; our company got the assignment and we concluded a contract with Ms. Anna Almási, interim manager. On the following week our candidate began her work.
Anna soon got acquainted with her duties and started to produce results.
Our assignee performed her tasks for nearly 5 months, until the permanent chief accountant was found, and she helped the new chief accountant to adapt himself to the company's work. At the final discussion the economic director of the company expressed his thanks for the smooth closing of the year, since the headquarters of the company practically "did not notice" at all the crisis situation emerged in the field of financial management.
Csősz Kft.
Nyíregyháza
The owners of Csősz Kft. (dealers of Opel-Chevy) were informed by one of our former client how successful interim management service proved to be in their case. Csősz Kft., similarly to the above mentioned former client of ours, has undergone significant growth, which was not accompanied by the creation of a new organizational structure, managerial liability system and accountability of managers.
Therefore the Assignor contacted us with a concrete task, requesting that Mr. László Steiner should assist them in this work.
Within the given financial limits we could solve the task only in a way that Mr. Steiner worked 1 or 2 days weekly with the managers and the owners and completed the following work:
- Testing of managerial skills
- Creation of the operation model
- Creation of the organizational structure
- Creation of managerial liability system in compliance with the above
- Elaboration of the system of managerial index numbers and accountability
- Elaboration of managers' incentive system
Meanwhile the owners had to face the fact the management of the company calls for different dimensions than they were accustomed to before.
As a "by-product" of the work, we created the means of planning and management control for the company. The application of such means gradually developed and it was partly due to this, that despite ever hardening market conditions, the company did not lose its profitability.
At the end of the assignment we worked out together with our Assignor the economic plan for year 2007, including managerial index numbers and the attached managerial tasks.
The good result of our work is reflected in the fact that the company performed well even in the very difficult year of 2007.
Thank you for reading the interim case studies.