Working capital is often our biggest manageable control of cash and capital. Traditionally, we net if off to show the total, but each part can deliver cash – Reducing excess stocks and debtors and increasing (negotiated) creditors by say 10% – delivers a 30% improvement
Our experience shows around 70% of potential working capital improvement comes from implementing more effective internal processes – you control your performance and Working Capital Consulting can help!
Confidence through cash flow
We currently have uncertainty across global markets, trading agreements and currencies. Having the confidence that we are optimising cash flows and reducing risk won’t make the uncertainty go away, but it will increase our control and generate funds to cope with market movements.
Question: Who is responsible? Sales, Marketing, Manufacturing, Planning, Purchasing, Logistics, Finance etc.
Answer: All of them.
Working capital activity covers virtually every operating process we have – and as a result each part of our business has an impact.
For over 10 years we have worked across many industries and countries, helping to increase working capital performance and process efficiency.
Our objective is to deliver cost effective solutions that increase in-house skills and awareness and provide senior management with options to improve process efficiency.
But first we must identify the size of the prize.
Before we meet, we will have done our homework. How do we compare to our last few years? What is the gap to our peers? We will have reviewed these to identify where there is scope to increase cash flow.
Starting with initial discussions, we can review high level opportunities and share some insights – we value your time. This will help us understand the issues you face and the outcome you want – and what you perceive the barriers to be.
Our approach ensures a minimum of disruption to the business at each stage of activity. We need executive level sponsorship to help create awareness of the scope to improve and to support the change of day to day operating activities.
We work with staff and managers in their functional areas to revise, agree and introduce new processes and procedures into daily routines.
Our approach concentrates on identifying and confirming the scope for improvement as early as possible and building a cost effective delivery approach. We recognise the need for early payback of cash and cost and prioritise the programme to maximise benefit.
Finding, Delivering and Sustaining Cash and Profit from Working Capital.
Your objectives are achieved by introducing best practice working capital processes and growing the culture of cash and cost awareness.
Working on the drivers of operating working capital - to increase accuracy and avoid excess cycle times, we support behaviour change through training and coaching across the business.
Companies typically operate through functional silos, many with conflicting objectives and measurement parameters.
Working capital processes traverse these functions and can be slowed up and delayed by incompatible and inconsistent functional objectives.
We recognise these and actively review end to end processes to identify working capital potential and design the solution.
We use existing metrics and data to examine historical performance at a detailed operational level and with informal interviews with staff and management we rapidly identify where cash and cost is leaking - and confirm the changes.
The end to end working capital process shows...
Cash gets lost in the gaps between processes - we know how to fix this.
As working capital moves through an organisation it becomes more complex, is prone to error and cycle times can become extended. Cost and cash get trapped inside these process silos and internal efficiency and focus suffer.
We support development of process ownership and impact clarity for each stage of the working capital journey and ensure that company metrics identify the impact and responsibilities of each part.
By aligning working capital objectives and recognising and effectively dealing with the trade offs between different parts of the business, we can straighten out these processes and shorten them.
Solutions are implemented through a flexible approach that combines traditional hands on project activity and best practice with workshop based process design and training to match the level of change support needed.
Ongoing client support can provide clients with progress insight to ensure that benefits continue to be delivered and sustained and further opportunities identified and targeted.
