Case Study

Oper­a­tional Excellence

A port oper­a­tions group stomps out fire­fight­ing and saves $10.3million

September 29, 2021

Key results

$10.3 mil

Reduc­tion in annu­alised labour costs

100%

Achieve­ment of pro­posed finan­cial results and cost reduction

4.8:1

Return on investment

About the client

Our client is a com­pa­ny that man­ages the move­ment of car­go from ports in var­i­ous parts of the world.

The chal­lenge

The com­pa­ny was fac­ing increas­ing pres­sure from var­i­ous stake­hold­ers. Share­hold­ers, for one, were press­ing for results, cost reduc­tion, bet­ter com­mu­ni­ca­tion and trans­paren­cy. Com­pe­ti­tion was also expect­ed to increase due to over­ca­pac­i­ty . The organ­i­sa­tion need­ed to be more effi­cient and pro­duc­tive to sup­port these changes.

How­ev­er, the organ­i­sa­tion lacked readi­ness for sus­tain­able growth.

Inef­fec­tive organ­i­sa­tion­al structure

The company’s organ­i­sa­tion­al struc­ture and sup­port process­es were not designed for rapid response to vol­ume vari­a­tions. Fur­ther, unclear strate­gic align­ment across the organ­i­sa­tion and the lack of clar­i­ty in report­ing lines ham­pered the company’s growth as man­age­ment had dif­fi­cul­ties dri­ving strate­gic plans to low­er levels.

The com­pa­ny also had a top-heavy man­age­r­i­al structure. 

Lack of Man­age­ment Con­trol Sys­tems and stan­dard processes

The company’s sys­tems had grown organ­i­cal­ly over the years but were poor­ly aligned with the company’s strate­gic tar­gets. Although much data and infor­ma­tion exist­ed, few KPIs mea­sured pro­duc­tiv­i­ty and per­for­mance. The com­pa­ny lacked vis­i­bil­i­ty on com­pli­ance and exe­cu­tion per­for­mance lev­els and had dif­fi­cul­ty in iden­ti­fy­ing vari­ances and root caus­es of prob­lems, which caused unwant­ed events to recur.

Organ­i­sa­tion­al behav­iour that did not sup­port growth

Employ­ees were often fire­fight­ing prob­lems of the moment. Due to unclear roles and respon­si­bil­i­ties and a lack of account­abil­i­ty, there were mis­ori­ent­ed efforts and low lev­els of sus­tain­abil­i­ty of imple­ment­ed actions and initiatives. 

What we did

To cre­ate a more effec­tive organ­i­sa­tion, we had to address more than the struc­ture alone. Togeth­er with a task force from the com­pa­ny, we redesigned the company’s organ­i­sa­tion struc­ture, sys­tems and process­es to work togeth­er to stim­u­late “want­ed behav­iour” and ever-increasing performance.

Designed a new organ­i­sa­tion structure

The struc­ture was redesigned to improve align­ment to work process­es and new tools were cre­at­ed to con­trol or scale future labour requirements.

Opti­mised processes

Process­es were reviewed and doc­u­ment­ed with stan­dard oper­at­ing pro­ce­dures. We designed and imple­ment­ed process man­age­ment con­trol sys­tems in all areas togeth­er with the task force, as well as improved for­mal com­mu­ni­ca­tion, man­age­ment per­for­mance reviews and action plans for increased func­tion­al performance.

Adjust­ed organ­i­sa­tion­al behaviour

Job descrip­tions were rewrit­ten in accor­dance with new struc­ture func­tions, roles and respon­si­bil­i­ties. After the new organ­i­sa­tion­al design was imple­ment­ed, all affect­ed per­son­nel were trained in the new ways of working.

Renoir also trained “inter­nal con­sul­tants” with­in the com­pa­ny to iden­ti­fy and work on future areas of oppor­tu­ni­ty geared towards pre­ven­tion rather than cure.

Results

In addi­tion to the $10.3mil labour cost reduc­tion, the trans­for­ma­tion pro­gramme delivered: 

  • A struc­ture for the oper­a­tions, admin­is­tra­tion and sup­port functions
  • Key process­es and inter­faces aligned with oper­at­ing procedures
  • Improved com­mu­ni­ca­tion lev­els with­in the organisation
  • Trained man­agers  
  • An inter­nal group of qual­i­fied pro­fes­sion­als to lever­age the knowl­edge acquired

The com­pa­ny is now a more effi­cient, future-ready com­pa­ny, work­ing with­in stan­dard­ised process­es and man­age­ment con­trol systems.

* We take client con­fi­den­tial­i­ty seri­ous­ly. While we have kept the brand anony­mous, the results are real.

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