The media industry is in the midst of major changes. The way consumers use media is constantly evolving, as are the needs of advertisers. August’s client, a major media player, was getting pummeled in this disruption. The company launched a transformation program and enlisted August’s support to identify ways of boosting topline growth.
The media market had taken a nosedive and losses were mounting
The company had been consistently losing revenue and profit. There was a real danger that its offering and ways of working would become obsolete, as consumers’ and advertisers’ needs evolved fast. For example, its consumer portfolio was not meeting the changing demands of how consumers used media. On the other hand, advertisers were demanding a higher return for their marketing investments. The company was struggling. How to tackle these challenges? What kind of offering improvements needed to be done? How to better harness digitalization in serving customers? How to update pricing to ensure future profitability?
The transformation program needed to create measurable topline growth
The client and our team started by making a long list of hypotheses for improving the topline. These hypotheses had to do with both tackling the consumers’ changing media consumption habits and catering to advertisers’ more complex needs regarding, for example, the targeting of ads. The team did a complete analysis of the hypotheses and estimated the related topline improvement opportunities. Additionally, the client and August created a solid implementation roadmap that included key initiatives to ensure that the transformation would be completed successfully.
The company needed to regain control to survive in the new market environment
After the project, the company had clear a ”playbook” to counter the changing market environment. Also, the people within the company were committed to making the necessary changes. The project provided a great understanding of the big picture and of the changes that were happening in the company’s operating environment. The company now had a clear vision regarding prioritized development areas and could confidently start growing its topline.
Fighting back in a retail squeeze
A major retail company was unsure whether to attempt a turnaround or divest its Finnish operation. Together with the client team, August identified a very challenging but realistic path to profitability and growth. A year later, the company was once more profitable and had reclaimed its position as a Nordic leader.
The company faced deteriorating profitability and an industry in flux
The company had seen its profitability plummet during the past few years. Its business environment was changing rapidly and the value chain was evolving. This had created disruptions in its traditional revenue streams and squeezed its margins almost to the point of vanishing. In addition, the company was suffering from a series of internal challenges including lackluster cooperation between key functions and a scattered customer segment focus.
Growth was an absolute necessity to succeed in the transformation
In the initial diagnosis, it became clear that the company could not simply downsize its way to profitability. To change its course, August supported the client’s management in defining a growth strategy as well as defining a plan for a complete turnaround program.
After the planning phase, the client management took the lead in leading the program and engaged August in a series of projects that focused on solving key bottlenecks such as organization structure, pricing and performance management. The client management also sped up change by engaging August to co-create a change campaign to drive day-to-day profit improvement actions in its outlet network.
The transformation was rewarded with accelerating growth and good profitability
One year after the cooperation was launched, the company was back on a profitable growth track, reaching above-market growth rates and a substantial margin improvement. In addition to the support in strategy, organization, pricing and performance management, the company valued August team’s contribution in making the turnaround happen by steering the pilot initiatives side-by-side with the management team.
CLIENT CEO TESTIMONIAL
“In our cooperation, I have found August teams to be very diligent and productive. Most importantly I have learned to value having the same senior leadership that sell a project take an active role in the delivery with a resolute commitment to commonly set targets.”
Driving change by pulling soft side levers
The company, a construction industry player, had lost market share and several KPIs were indicating poor performance. A new Managing Director saw that the root cause was a poorly managed change program. August identified corrective actions based on an in-depth understanding of ‘soft’ organizational levers.
A new Managing Director needed change to be implemented
The new Managing Director faced a challenge: in recent years, his company had lost market share to competitors. Profits were modest and customer satisfaction and employee engagement were declining. The company had also been implementing its new “One Company” strategy as the organization was going through several changes. The biggest changes included the implementation of a new ERP system and the establishment of a centralized supply chain function in order to capture synergies from an integrated operating model. The changes were not progressing nearly as fast as expected. The managing director needed to understand the true road blocks for the change and reasons for the lagging performance and to launch pragmatic actions to fix the situation.
Organizational factors revealed the need for new focused initiatives
Using Organizational Performance Diagnostics, we were able to form a holistic picture of the true pain points and distinct root causes to these problems and understand what remedies would actually correct the situation. It quickly became apparent that the new operating model was not yet embedded in the organization. Local units were still focusing on optimizing their own performance by directly violating the new integrated way of working. As the evidence accumulated, our team was able to identify a set of operational challenges and an interlinked set of cultural challenges.
The team design focused initiatives to tackle these challenges. For example a fresh “One Company” campaign was launched. We believed the company needed to get a more positive tone to the change and ensure that the new way of working was understood on all levels of the company. Another example was shifting the performance management towards larger units. As the new integrated operating model required units to optimize the whole entity and increase collaboration, the executive team needed to focus on managing performance of entities would be large enough and include all key functions. Local optimization needed to be discouraged.
After a successful change, operating profit was up by 50%
The new initiatives made the change more meaningful and relevant for people around the organization. The project helped the management to tackle the key operational challenges and as a result, operating profit shot up by 50% in the following year.
Wild and free – a consumer transformation
The company’s financial performance had been declining steadily in an extremely challenging environment. A new CEO needed to take corrective actions and launch a transformational strategy to get the company back on its feet.
Only a complete transformation could protect the company from intensifying competition
The company operated in a challenging market, where established major businesses had been subjected to changing consumer demands and intensifying competition. As a result, financial performance had dropped as consumers were leaving products on the shelf. The organization was starting to feel the pressure as well. The mood around the office had become somber, as the future began to look increasingly bleak. The CEO needed to put the company back on track and knew that difficult choices would have to be made along the way.
An inspiring corporate strategy was the foundation for changing the company
In close collaboration with the top management team, August created a comprehensive understanding of the market and what the company’s position in that market should be. We put particular focus on identifying the company’s ‘Center of Gravity’ – the inherit source of its strengths and weaknesses. A deep understanding of the company’s Center of Gravity allowed the CEO to plan and execute a difficult transformation.
In addition, the strategy identified the competitive advantages of the company and defined in greater detail, which markets, product categories and segments were crucial for future success.
A powerful strategy to steer the company on its transformation journey
The strategy work forced the company to make difficult choices regarding its business. In addition, it set the ambition level for the way of doing business and clearly described the transformation path ahead .
Strategy book, written by the top leaders, was a powerful communication tool towards the organization. Also the broadly involving strategy process itself helped the organization regroup and start the transformation journey together.