validus management consultancy UK

Chemicals Case Study

Chemical manufacturer subsidiary

Overcapacity in the chemicals sector affecting profits
Improvements programme developed and implemented resulting in major profit achievments


  • The German subsidiary of a major, multi-national chemicals manufacturer


  • Overcapacity within the chemicals sector
  • Group looking for common basis across the whole Group on which to make strategic investment decisions
  • Group looking for improved integration and profit improvement opportunities


  • Carried out detailed review of all operational functions
  • Engagement of the local management team in the review process and programme
  • Detailed commercial analysis of customer, product portfolios and levels of contribution
  • Examination of routes to market, processes, procedures and the cost of sales covering; direct sales workforce, agency relationships, effectiveness of sales administration procedures
  • Examined demand patterns and the basis of trading; global contracts, tenders and periodic demands
  • Detailed review of production planning and scheduling, including the effectiveness of recently installed SAP supporting systems
  • Detailed review of product changeover and set-up procedures
  • Review of purchasing procedures and effectiveness, identification of opportunities for purchasing savings
  • Reviewed procedures for evaluation and implementation of new product streams


  • Developed and agreed detailed implementation programme with local management team encompassing:
    • Product and Customer rationalisation programme
    • Design development and implementation of improved marketing plan and sales management procedures
    • Programme for targeted purchasing improvements
    • Establishment of new production planning and scheduling function
    • Definition of production planning parameters, based on EOQ principles
    • Integration and acceleration of SAP implementation
    • Improved management procedures for control of the direct workforce
    • Evaluation procedures for managed development and implementation of new product streams
  • Programme adopted, owned and implemented by local management and staff
  • Major profit improvements achieved