Case Study 8
Detail of Major Contract

1. Original predicament

The financial directorate had been without a leader for over four months and the overall business was quivering from the effects of recent high raw material price hikes. Also the existing managerial drive appeared to be floundering due to the effects of resultant low profitability and after a period of heavy capital expenditure based upon previous good returns. The core business had much potential for development especially because of its products' high quality standards and its five star customer base. The financial reporting was suspect at best and sadly lacking overall for an organisation of its size. There was a lack of basic controls in the finance department over day to day transactions and misguided belief that the regime was adequately supporting the business. This shortfall was compounded by the differing bases from which information was gathered by various factions of the department who were acting independently and in isolation. Also the generally inadequate backgrounds of the department's incumbents and the widespread ill founded attitudes within the finance department as a whole. APS was appointed as the Director of Finance and Systems to control, redirect and develop the finance department and also implement improved systems company wide.

2. Suggested solutions

The paperflows within the company did not capture the movement of goods and a crusade was needed to facilitate proper recording. Fortunately the technical department had high exposure within the production process and this together with their drive for accreditation was to be used as a means to an end. There was a basic need for better information, greater standardisation and more cross functional co-operation. To achieve this it was proposed to incorporate the developing structure within the technical and production departments as a springboard to collect base data. It was also proposed to deliver a series of new reports regularly from the finance department to management covering subjects such as stock, debtors, cash, etc. and furthermore redesign much of the existing reporting to present it in a more meaningful way/easier to read basis and in a more professional manner. The staffing within the finance department needed to be of a much higher calibre and plans were proposed to transform the hierarchical structure and upgrade the IQ levels. It had been recognised in the past that the quality of management information was a key factor for the success of the business but due to a variety of reasons this initiative had stalled and, therefore, a series of discussions were started involving managerial staff to ascertain their requirements for a new computerised system. It was easy to see that the existing computer software was at a level far below the needs of the business and various general ideas were proposed to better provide the information so desperately needed. However, the cost of such a significant jump to a major software house needed time to digest and this was appreciated by APS. Therefore, our remit was limited to wetting the appetite and clarifying the major hurdles that would need to be cleared at every step of the venture.

3. Results

A total reorganisation and improvement was achieved to the structure of the finance department. The staffing was realigned to reflect the current needs of the business and plans were mindful of the requirement to make the finance department supportive of the high growth expected in the future. This was a drastic action but, due to previous lack of activity, was the only way forward to support the growth of the business and the ever increasing needs of the organisation. It was difficult in all of this reorganisation to properly plan major new computer systems for the future, especially as the location of the business was at all times subject to reappraisal. However, certain specialist computer systems, which delivered answers to specifically identified problems, were proposed after they had received endorsement from the management and these were primarily selected because of their integration potential with any future company wide system. A tremendous amount of progress was achieved during the contract and the APS assignment was a very great success. As a result the potential created to develop the business in the future was secured by the many building blocks and concrete foundations built.

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