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Fit for Growth case study
A Fortune 200 company’s large-scale enterprise transformation
A global packaged goods company transforms its entire business thanks to an enterprise-wide effort
Client: Fortune 200 consumer packaged goods company
Our Role: PwC helped the client implement roadmaps to overhaul every department, streamline their business model, and realize $500 million in direct savings.
Industry: Consumer Markets
Services: Fit for Growth, Finance transformation, Operations strategy
Situation
Revitalizing and transforming a company to position itself for growth.
A Fortune 200 consumer packaged goods company, with billions of dollars in annual revenues, had become accustomed to years of steady growth. Like most of the industry, those years of growth began to stagnate. The company wanted to make big bets to fund growth in some of its most popular product categories and in key geographic regions, and it wanted to build capabilities in critical areas including digital, sales and innovation, but the company needed to free up funding to make this happen.
The company’s structure and culture provided some challenges to this, and like most companies, needed to step back and re-evaluate how it was making decisions and what it funded. For example, balancing the benefits of local speed and flexibility while ensuring it could embrace the right type of scale and efficiency on the global stage.
The client approached us with the initial goal of reducing expenses, but it soon became apparent that the company would take this opportunity to rethink its entire operating model in order to improve competitiveness globally.
Solution
PwC worked with the client to overhaul every department, with the goal of making the business more efficient and effective in a highly competitive marketplace.
PwC spent over a year meeting with the client to build alignment on the scope of the challenge. We began by working closely with management to build a level of competitive understanding, sharing information with each other to help analyze their market position. What began as a conversation about best practices in the finance organization ultimately grew into a large-scale enterprise transformation.
Our engagement ultimately evaluated the organization across more than 50 countries and virtually every function from the front office to the back office, requiring a vast level of expertise that touched a huge portion of PwC’s global capabilities.
“As a result of our engagement, the company has become more focused. It is now able to make clearer decisions with greater speed and its ability to execute on those decisions has improved.”
Refining the client’s operating model to restructure its activity on a global scale.
While our initial goal was to find ways to help reduce expenses and free up cash to fund growth, the engagement ultimately became heavily focused on the client’s operating model—how it worked across its critical business units and geographic regions. Specifically, we challenged the client to rethink how markets were resourced and what the appropriate level of investment in each of these markets should be. We structured our program around four pillars to uncover specific and actionable opportunities across the organization, categorizing them as commercial, operational, general/administrative or non-labor. We asked: Where could we reduce duplication of effort? Where could we standardize activities? Where could activities with less local customization be centralized or offshored to take advantage of scale?
Seeking out and eliminating duplicated effort by streamlining sales, development, and more.
We deployed our unique version of zero-based budgeting, challenging each client leader to identify potential solutions across a common set of levers. For example, where each function could eliminate activities that didn’t bring value or change demand to enable more efficient delivery - including self-service. We ensured teams were not just focused on addressing non-labor spend but also how the organization should work differently. Ultimately, we spent four months working with the client to develop an in-depth playbook designed to make the business more efficient and effective.
For example, we found opportunities to reevaluate and renegotiate various third-party contracts and to eliminate “non-working” spending on external marketing agencies. We proposed a new, streamlined sales model and advised reallocating research and engineering activities to clusters of lead markets which would be accountable for new product innovation, development and commercialization. Our ultimate goal was not just to cut spending but to redeploy the company’s significant assets and reprioritize them while speeding up the client’s decision making ability.
Seeking out and eliminating duplicated effort by streamlining sales, development, and more.
We deployed our unique version of zero-based budgeting, challenging each client leader to identify potential solutions across a common set of levers. For example, where each function could eliminate activities that didn’t bring value or change demand to enable more efficient delivery - including self-service. We ensured teams were not just focused on addressing non-labor spend but also how the organization should work differently. Ultimately, we spent four months working with the client to develop an in-depth playbook designed to make the business more efficient and effective.
For example, we found opportunities to reevaluate and renegotiate various third-party contracts and to eliminate “non-working” spending on external marketing agencies. We proposed a new, streamlined sales model and advised reallocating research and engineering activities to clusters of lead markets which would be accountable for new product innovation, development and commercialization. Our ultimate goal was not just to cut spending but to redeploy the company’s significant assets and reprioritize them while speeding up the client’s decision making ability.
Seeking out and eliminating duplicated effort by streamlining sales, development, and more.
We deployed our unique version of zero-based budgeting, challenging each client leader to identify potential solutions across a common set of levers. For example, where each function could eliminate activities that didn’t bring value or change demand to enable more efficient delivery - including self-service. We ensured teams were not just focused on addressing non-labor spend but also how the organization should work differently. Ultimately, we spent four months working with the client to develop an in-depth playbook designed to make the business more efficient and effective.
For example, we found opportunities to reevaluate and renegotiate various third-party contracts and to eliminate “non-working” spending on external marketing agencies. We proposed a new, streamlined sales model and advised reallocating research and engineering activities to clusters of lead markets which would be accountable for new product innovation, development and commercialization. Our ultimate goal was not just to cut spending but to redeploy the company’s significant assets and reprioritize them while speeding up the client’s decision making ability.
Seeking out and eliminating duplicated effort by streamlining sales, development, and more.
We deployed our unique version of zero-based budgeting, challenging each client leader to identify potential solutions across a common set of levers. For example, where each function could eliminate activities that didn’t bring value or change demand to enable more efficient delivery - including self-service. We ensured teams were not just focused on addressing non-labor spend but also how the organization should work differently. Ultimately, we spent four months working with the client to develop an in-depth playbook designed to make the business more efficient and effective.
For example, we found opportunities to reevaluate and renegotiate various third-party contracts and to eliminate “non-working” spending on external marketing agencies. We proposed a new, streamlined sales model and advised reallocating research and engineering activities to clusters of lead markets which would be accountable for new product innovation, development and commercialization. Our ultimate goal was not just to cut spending but to redeploy the company’s significant assets and reprioritize them while speeding up the client’s decision making ability.
Seeking out and eliminating duplicated effort by streamlining sales, development, and more.
We deployed our unique version of zero-based budgeting, challenging each client leader to identify potential solutions across a common set of levers. For example, where each function could eliminate activities that didn’t bring value or change demand to enable more efficient delivery - including self-service. We ensured teams were not just focused on addressing non-labor spend but also how the organization should work differently. Ultimately, we spent four months working with the client to develop an in-depth playbook designed to make the business more efficient and effective.
For example, we found opportunities to reevaluate and renegotiate various third-party contracts and to eliminate “non-working” spending on external marketing agencies. We proposed a new, streamlined sales model and advised reallocating research and engineering activities to clusters of lead markets which would be accountable for new product innovation, development and commercialization. Our ultimate goal was not just to cut spending but to redeploy the company’s significant assets and reprioritize them while speeding up the client’s decision making ability.
Seeking out and eliminating duplicated effort by streamlining sales, development, and more.
We deployed our unique version of zero-based budgeting, challenging each client leader to identify potential solutions across a common set of levers. For example, where each function could eliminate activities that didn’t bring value or change demand to enable more efficient delivery - including self-service. We ensured teams were not just focused on addressing non-labor spend but also how the organization should work differently. Ultimately, we spent four months working with the client to develop an in-depth playbook designed to make the business more efficient and effective.
For example, we found opportunities to reevaluate and renegotiate various third-party contracts and to eliminate “non-working” spending on external marketing agencies. We proposed a new, streamlined sales model and advised reallocating research and engineering activities to clusters of lead markets which would be accountable for new product innovation, development and commercialization. Our ultimate goal was not just to cut spending but to redeploy the company’s significant assets and reprioritize them while speeding up the client’s decision making ability.
Results
Savings of $500 million, and a streamlined business model tuned for the future.
In the immediate term, PwC’s implementation roadmaps were poised to help the client realize $500 million in direct savings over the following 3 years, including non-labor savings of over $100 million.
While the client is still implementing some aspects of the plan, it is now a long way down the path and organic growth is once again on the rise.
Structurally, the company now has fewer regional layers, less overall complexity, a cleaner product matrix and better clarity into the operations of the global market. It is outperforming competitors in priority markets and placing fewer but bigger, faster and more focused bets on its future.
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