Client Situation

A Western European aluminium extrusion manufacturer had been operating at a loss for several years. Despite a solid market presence, the plant suffered from an unprofitable product mix, inefficient structures, outdated equipment usage, and inconsistent performance across key operational indicators. The company needed a comprehensive restructuring strategy to return to sustainable profitability.

Objective

Develop and implement a restructuring concept that realigns the product portfolio, optimizes organizational structures, enhances operational performance, and restores profitability within a 12-month timeframe.

Approach & Implementation

1. Profitability and Product Mix Analysis

Working closely with the controlling department, we conducted a detailed profitability analysis across the entire product mix. Through a series of collaborative workshops, the product portfolio was segmented according to financial performance and market potential.

• Identification of profitable product groups with strong future demand
• Clear distinction of loss-making products with limited strategic relevance
• Creation of a focused product portfolio defining target segments

The management team agreed to discontinue low-potential, non-profitable product lines, providing the basis for a streamlined and future-oriented portfolio.

2. Commercial Reorganization

To support the new strategic focus, the commercial organization was restructured:

• Appointment of dedicated sales managers for each target product segment
• Establishment of cross-functional project teams aligned with these segments
• Implementation of segment-specific profitability improvement initiatives

This ensured transparency, accountability, and customer focus across the new portfolio.

3. Equipment Portfolio Optimization

The revised product strategy required a reassessment of the plant’s technical assets:

• Analysis of all equipment regarding utilization, capability, and relevance
• Divestment of equipment no longer required after portfolio restructuring
• Consolidation of production on modern, efficient machinery

This shift reduced complexity, improved operational reliability, and created a technological environment aligned with the new product focus. This increased customer focus, accountability, and transparency in the commercial processes.

4. Operational Excellence and Performance Improvement

Multiple cross-functional teams were created to address key performance indicators, including:

• Recovery and yield
• Quality performance
• Productivity and throughput
• Inventory levels
• Employee involvement and workplace organization

A Kaizen mindset was introduced, significantly increasing employee improvement proposals. A plant-wide 5S system was implemented, leading to cleaner work areas and more stable processes. Maintenance backlog was drastically reduced, improving equipment uptime and reliability.

5. Workforce and Cost Optimization

A bottom-up manning plan was developed to align staffing levels with the optimized production structure. This resulted in:

• More than 25% reduction in headcount
• Introduction of a strict cost-control and KPI-driven management system

These measures ensured long-term cost discipline and increased productivity.

Results

Within 12 months, the restructuring program delivered significant and measurable improvements:

• Record order intake
• First profitable months after many years of losses
• Streamlined product portfolio focused on growth and profitability
• Higher equipment reliability and improved KPIs across all major dimensions
• Stronger organizational structure with clear accountability and customer focus