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I Need an Interim CEO or Interim President

I Need an Interim CEO or Interim President

There’s a number of reasons companies bring in an Interim CEO or Interim President beyond the most popular cause of a vacant position.

At Cerius, we have seen the strategic use of an Interim CEO or Interim President include:

  • Turnarounds
  • Company CEO does not want to be involved in the day-to-day operations of the company anymore so looks to bring in a Interim President while they stay on as CEO and Chairman of company
  • Family owned businesses to better prepare a family member to take over as CEO or President
  • Situations involving merger, acquisition, purchase or sale of a business
  • Partnership resolution
  • Founder of company is a scientist, engineer or technologist and does not want to run the company as the CEO or President

Interim CEOs and Interim Presidents (also known as temporary executives, part-time CEOs, or super temps) have already enjoyed stellar C-level careers in which they started, grew, and sold successful businesses. Now in their current careers these senior executives step into organizations like yours for a season to provide highly objective recommendations and lead your management team to deliver significant measurable results. They are ideally suited to not just fill a leadership gap, but to actually energize and grow the business.

We are seeing a current trend in the area of business exits. A number of business owners we know are looking at a near term exit. Either they have held on to the company longer than planned on due to the recession or a number of other factors leading them to consider now is the time. There’s a number of things that can be done to maximize a company’s value and the sell price for the owner. In many cases, the owner has been the CEO and/or President up to this point and though they were the best to grow the business, they may not be the right ones to prepare it for an exit. An Interim President not only brings an outside perspective and the expertise to create additional value, it also shows potential investors that the value of the company is not contingent on the owner running the company.

The right Interim CEO or Interim President can have a great and immediate impact on the situation and help better drive the company to its goals. Here’s a few of the most common ones we see from clients at Cerius, how they were addressed and the types of results the client experienced:

Family owned Manufacturing Company of Electronic Components

Interim President: 2-3 days/week, 6 months

Situation

  • Company losing money, one month away from closing
  • Father founded the company, currently run by one of the siblings
  • Concerns regarding sales organization and leadership
  • Non-performing team
  • No plan, goals or metrics, lack of processes
  • High inventory, low turnover

Implementation

  • Established strategic plan, goals, metrics with dashboards, daily quotas and accountability
  • Daily meetings with follow through
  • Prioritized quotes and engineering
  • Increased margins through charging for engineering, successful price increases, better metrics for purchasing
  • Corrected inventory
  • Reorganized with 20% force reduction, removed “C” players and elevated other employees
  • Created daily booking thermometer to allow for 13 week budgeting

Results

  • Breakeven in 2 months, profitable by 3rd month
  • 3% loss to 3% profit in 5 months
  • Returns reduced by 90%
  • Inventory reduced by over 16%

Sustainable Results One Year Later

  • 25% increase in product shipped
  • 13% decrease in COGS
  • Now, 7.5x more profitable

Family Owned Manufacturing Company

Interim CEO: 4-5 days/week, 3 months

Situation

  • Father (owner/operator) passed away suddenly
  • Succession planning had not been done so there was no clear leadership
  • Company was losing money, knew something was wrong
  • Lack of strategic plan and reporting for decision making
  • Lack of inter-department sharing
  • Inaccurate financials
  • Outdated ERP system

Implementation

  • Realigned culture to Expect Excellence
  • Implemented LEAN manufacturing
  • Initiated regular meetings & reporting
  • Initial dashboard formulated to drive key core metrics
  • Analyzed and addressed scrap, overtime, and returns
  • Aligned customer terms with industry standards improving profitability
  • Reorganized warehouses
  • Analyzed and implemented state of the art scanning system
  • Right sized organization to current business needs and conditions

Results

  • Provided savings equivalent to 4x increase in sales
  • 50% scrap reduction
  • 78% reduction in Overtime
  • 75% reduction in returns
  • Found additional $1M in sold inventory
  • 15% reduction in storage costs
  • 50% reduction in SKU’s
  • 10% reduction in workforce

Though no two companies and situations are the same, we find there are often common themes within organizations and at Cerius, we know how to find the right expertise to address the need and provide results. If you have more questions about interim executives and management consultants click here some of the most commonly asked questions and answers.

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