Treadstone’s holistic and data-driven approach enables clients to achieve leadership in their core business, leverage their core strength to grow into adjacent opportunities, and operate at superior levels of performance to drive industry-leading results.
We start by analyzing what full potential means in practical terms–for a whole company, a business unit or a function. Our first step is to perform a diagnostic and size the opportunity based on hard factual data. Our strategic and cross-functional approach helps clients unlock value beyond cost containment measures within a specific area of the organization. In fact, in our experience, addressing operating problems at the nodes–the points where business units, functions, geographies, and layers of management intersect and have to make and execute critical decisions–creates between three and four times as much value as traditional approaches to right-sizing and functional excellence.
Treadstone’s strategic services will provide you with the knowledge and decision-making support your business needs to exceed expectations.
The Treadstone Philosophy
We help our clients with both large-scale integrated transformation solutions as well as more focused, specific functional solutions.
Our integrated solutions include:
- Performance Improvement Diagnostic℠: Change industry boundaries to redefine full potential
- High Speed Cost Diagnostic: Quick diagnostic to identify immediate and longer-term opportunities
- Sustained Cost Transformation: Strategically transform the cost structure across the organization to obtain cost leadership and gain competitive advantage
- Treadstone Accelerated Transformation: Rapid cost transformation approach for an urgent turnaround and restoring profitability
- Complexity Management: Effectively manage all elements of complexity to unlock value and turbocharge the organization
- Lean Six Sigma: Working back from the customer to deliver better outcomes with lower cost and higher quality
- Business Process Redesign: Achieve operational excellence at a company’s most critical processes to deliver high quality service at a competitive cost
- Capability Sourcing: Acquire the right capabilities from the right source, and the right shore, at the right price
- Cash and Capital Management: Create cash visibility and a disciplined capital allocation process
Our process-specific solutions include:
- Procurement: Make procurement a source of competitive advantage by finding quick cash and building procurement capabilities
- Supply Chain Management: Turn supply chain into a source of competitive advantage for meeting short- and long-term cost, flexibility and service-level goals
- Manufacturing Optimization: Optimize the manufacturing footprint and shop-floor operations
- Service Design & Operations: Deliver the promised customer experience at the right cost across service channels
- G&A Optimization & Org Design: Create lasting improvements in efficiency and effectiveness of G&A functions, aligning process goals to business objectives
- R&D/Product Development: Optimize the R&D function to maximize the return on investment in R&D
There is a constant stream of business fads and approaches, but a good general manager will conduct a hard-nosed, comprehensive review of the business to identify the most critical areas for improvement. Treadstone has developed a full-potential, performance improvement diagnostic framework that points the way. It starts from our understanding of the four critical variables in any performance improvement undertaking: costs, market position, changing customer behaviors and–perhaps the least understood–complexity.
We help firms attack complexity in order to serve customers better. Our research shows that companies with the lowest complexity grew 30 percent to 50 percent faster than their average competitor. High complexity is often a symptom of a larger problem, such as poor understanding of customers’ needs in the case of product proliferation or poor accountability and decision making in the case of organizational complexity. Tackling the root cause pays off handsomely. For example, by providing the right level of product variety, companies can grow revenue by 5 percent to 40 percent while reducing costs by 10 percent to 35 percent.
The High Speed Cost Diagnostic has the ability to identify and deliver cost reduction and cash improvement opportunities that can be implemented quickly for results within the fiscal year.
While not intended to replace a full cost evaluation and detailed action plan, Treadstone’s High Speed Cost Diagnostic can be used as a first step diagnostic tool during early opportunity-identification stages to offer a comparison of company performance against key indicators and best practices. Combined with Treadstone’s expertise and collaborative approach, the assessment offers a means for informing decisions on improvement opportunities.
Achieving a low-cost position is critical for most businesses both because of the obvious improvement to the bottom line, and for the ability to fund investments and growth initiatives that otherwise would be out of reach. Our clients typically use a portion of the captured savings to invest in R&D, marketing, new market entries or simply more competitive pricing.
While we many times work with companies to help them achieve functional excellence within individual areas of the organization, we unlock the most value by taking a cross-functional approach, and addressing operating problems at the nodes, or the points where business units, functions, geographies, and layers of management intersect and have to make and execute critical decisions. In our experience, this approach creates between three and four times as much value as the traditional approaches to right-sizing and functional excellence.
Complexity is a natural consequence of a company’s success. As companies grow, they enter new markets, expand their product lines and set out to conquer new customer segments. And on the way they build up their organizational, process and IT infrastructure to support that growth. Taken individually, each decision makes rational sense, but in aggregate, they create exponential growth of the “nodes”–points where business units, functions, geographies and layers of management have to interact to make and execute critical decisions. This often becomes the root cause of sluggish growth, high costs and poor returns.
We believe that some complexity is necessary, and even advantageous. For example, customers like to have some choices–and different segments have different needs; country or regional business units can be closer to the ground than headquarters and are more likely to know what customers want in their areas. However, if not carefully managed, the new interfaces and nodes of interaction can lead to bureaucracy, conflict and wasted energy. The key is not to eliminate choices and autonomy, but to consciously manage the benefits and costs of optimizing customer offerings, decision and operational processes, business and organizational structure, and the IT systems that support it all.
Treadstone has worked on over 100 projects across industries to help companies effectively manage complexity. While the cost savings are significant, the largest benefits nearly always come from achieving a better understanding of customer needs–and that leads to improved customer satisfaction, faster inventory turnover and, ultimately, higher revenues and margins. In fact, our research from 110 companies in 17 industries ranging from cosmetics to aerospace and medical equipment to mutual funds shows that companies with the lowest complexity grow 30 percent to 50 percent faster than their average competitors.
World-class companies use procurement as a source of competitive advantage but many organizations still undermanage this treasure chest because they lack a predefined, systematic playbook for reducing costs and identifying and implementing necessary improvements.
By taking a more comprehensive approach to what they buy and how they buy it, companies can reduce cost and free up cash. Full-potential savings programs can average 8% to 12% of total procurement costs and as much as 40% for some categories. Typically, these are sustainable cost savings that can be followed by a further 2% to 3% cost reduction annually. Furthermore, strategic procurement efforts often result in shorter cycle times and supplier-led product innovations.
Despite the increasing recognition of procurement’s importance, a recent management consultancy survey found a growing gap between what corporate leaders expect and what their supply management teams are able to deliver:
- Fifty percent of supply management executives interviewed considered their procurement organizations ineffective.
- Sixty-five percent admitted they don’t measure procurement’s performance in creating economic value and are unable to link procurement savings directly to their P&L.
Treadstone’s procurement consultants have worked on hundreds of engagements globally across all major industries, helping clients create world-class procurement organizations that can reduce their cost base, strengthen their supplier base and make the results stick.
We believe that a supply chain that is closely aligned with business strategy helps to advance business objectives and achieve sustained, profitable growth. While business strategy should drive supply chain design decisions, it is also critical to execute well on all of the supply chain’s tactical dimensions.
In a recent management consultancy survey, C-suite and supply chain executives agreed that supply chains are at the heart of outstanding performance. Nearly 90% of all executives surveyed felt that supply chains promote competitive advantage, are critical for satisfying customers and, at the same time, have significant room for improvement.
Our supply chain consultants have teamed with hundreds of clients on more than 1,500 engagements across all industry verticals. In working with client teams, we clarify supply chain priorities by bridging the gap between strategy and design and ensuring successful implementation, backed by operational expertise, to make the results stick.
The roots of poor quality and low manufacturing productivity often can be traced back to processes that happen long before the product hits the shop floor. They begin with product line complexity, product design, scheduling and sourcing. Treadstone helps clients address those sources of problems and implement lean manufacturing techniques that improve productivity 20 percent to 40 percent.
While our approach varies depending on the client’s situation, our overall framework starts addressing strategic questions that impact production cost, quality, flexibility, service levels, and control. This includes a clear understanding of what is the current and future product portfolio, what should the company “make vs buy” based on core capabilities and needs, and what should the future footprint and capacity plan look like–including which sites should be closed, consolidated, or prioritized for optimization.
Originally developed to improve manufacturing efficiency and quality, Lean Six Sigma is now being widely adopted by financial institutions, retailers, hospitals and other corners of the services industry. Lean Six Sigma is a blend of two concepts: lean manufacturing, which is aimed at reducing waste, and Six Sigma, which helps companies reduce errors. Together they can help companies reap the benefits of faster processes with lower cost and higher quality. From our research and experience with clients, we’ve learned that despite its growing popularity and impressive results at some companies, Lean Six Sigma often fails to deliver expected results. Treadstone’s management survey of 183 companies found that 80 percent are not achieving their expected value from Lean Six Sigma efforts, and 74 percent have failed to achieve their savings targets.
Treadstone’s approach starts with a full potential diagnostic and embeds Six Sigma methodology with added efficiency and speed from lean. In each case, we first gain an understanding a company’s value stream, and then move rapidly to mapping out processes and costs. Next, we define a view of “full potential” through such measures as bottleneck analysis and internal and external benchmarking. Finally, we target areas for improvement, unleashing the trained teams.
Our experience across industries and geographies allows us to perform diagnostics quickly that help companies achieve sustainable improvements. Using the cash and capabilities assessment to focus on areas with the most potential for generating results, our clients avoid the extra cost and time of training and deploying more teams than absolutely required. We partner with the right suite of third-party companies to deliver the right tools and solutions that best meet our clients’ needs.
We work with organizations across all industries to help them deliver superior customer experiences through innovative service design and productivity improvements across both digital and physical environments. Our analytical strength forms the foundation of our work. Our design capabilities then allow clients to prototype and refine key design and operational requirements, helping to validate functionality and performance levels and enable scale deployment. We specialize in designing and developing efficient and effective customer service operations that support customer acquisition, retention, cost management and profitability.
We have successfully completed hundreds of service design and operations projects within and across every major service domain, including bank branches, retail stores, field service operations, service center networks, contact centers and self-service channels. Our efforts have helped clients solve a multitude of service-related problems, including: reducing unnecessary work volumes, improving first time rates, placing the right person with the right job, re-shaping capacity requirements, developing staffing models, radically redesigning for fast and flawless episodes, and more.
Our teams develop practical recommendations that deliver sustained results through our best-in-class analytical rigor, design capabilities and a broad set of tools, including experience and work design, supply and demand management, and performance-based capacity management.
Business process redesign (BPR) examines the efficiency and effectiveness of a company’s most critical processes. It is a key enabler to deliver the highest-quality of service, in the most productive way, at the most competitive cost and time to output.
Treadstone works with each client to prioritize key processes based on the value at stake. For each priority process we develop a view of the current state based on operational data, using detailed process maps and analysis to help identify major gaps. We then work together with a cross-functional client team to define a series of principles that will guide the solution generation phase, and create a vision of the future state of each process from the ground up, along with the roadmap to achieve the near and long term results.
We work very closely with our clients in this type of project, enlisting a team from all the functional areas impacted at the leadership and the solution generation level. This allows us to eliminate waste, unnecessary wait times, reports, handovers and sign-offs, while ensuring the integrity of the process.
To create lasting improvements in efficiency and effectiveness, we help companies focus on getting four things right:
- The appropriate role and aspirations for support functions: G&A leaders need to anticipate and adapt to evolving industry and functional trends. G&A functions are evolving their roles to focus more on enhancing business value as opposed to delivering transactional support.
- The service portfolio and service levels aligned with business needs: Top-performing companies build alignment with the business on which support services should be “best in class” and which services should be “good enough” to help meet business needs and manage demand.
- The optimal service delivery model: Companies fundamentally change how work is done in order to simplify and eliminate low-value activities. These structural changes require a greater commitment than quick cuts to the current system but provide much longer-lasting value.
- The right people, processes, and systems: Optimizing the G&A function is not a one-time event. Ensuring the right people are in the right jobs with the right priorities and the right incentives ensures that costs don’t creep back in. Companies that get it right offer the re-training necessary for employees to succeed in their newly designed roles, invest in tools that drive productivity and create a culture of continuous improvement to ensure that processes keep getting better and costs don’t creep back in.
Capability sourcing improves a company’s competitive position by ensuring that processes and functions are obtained from the right source at the right cost. As sourcing matures, companies can leverage outsourcing and offshoring for more processes, in more countries, and to achieve a broader set of objectives, be it improved costs, quality, service levels or capabilities.
We help companies achieve sourcing excellence through a range of services including blueprint/design, outsourcing partner selection and transition, strategic offshoring implementation and support, and value delivery. Outsourcing and offshoring have evolved into much broader opportunities to drive transformational change. We help experienced users design disruptive sourcing strategies, implement low cost country footprints, monetize captive operations, renegotiate contracts and maximize ROI on existing programs. We also support less experienced users with issues such as blueprint/design their operation and expand the current scope.
In our experience, we find that complexity—in its many forms—slows innovation.Among the typical complexity pain points our clients experience: too many R&D projects that are not fully aligned with company or product strategy, too many processes—processes that may not be consistently followed or are not delivering what wins in the market, too many decision makers without a single point of accountability, and too many sites, capabilities and design methodologies without a clear understanding of what drives competitive advantage.
We work closely with our clients to untangle their complexity and install a clear and concise, repeatable R&D formula. Specifically, we enable them to innovate rapidly and spend more wisely by helping them to:
- Understand the customer ecosystem and prioritize customer needs
- Build innovation roadmaps to deliver on those customer needs
- Align R&D processes to deliver on a differentiated performance in time-to-market, cost and quality
- Optimize project team resources, organizational structures and infrastructure allocation
- Build a global footprint and install continuous learning systems
The outcome of our work is a finely tuned R&D engine delivering superior returns.
Treadstone helps clients around the globe in liberating cash, increasing the velocity of capital through the system, improving ROIC and instilling a disciplined approach to driving cultural change. In most cases, the effort is self-funded with very short payback periods.
We work with clients across the liquidity spectrum. This includes helping firms with strong balance sheets improve resource deployment across lines of business to generate higher and better returns for investors. At the other extreme, it encompasses recognizing if and when an imminent cash pinch will threaten a company, and devising ways to address the issues, no matter how severe.
Our approach combines strategic, tactical and organizational elements to ensure quick wins and creates a dynamic process and new, ongoing organizational capabilities to ensure sustained results:
- We begin with an assessment of whether case and capital are aligned with strategic principles, followed by a deep examination and prioritization at the product level. This process typically begins with charting a clear cash picture of the receipts and disbursements over a 13-week period to gain visibility into the real-time differences between expected and actual results. Detailed analysis of any variances highlights the differences between one-time, timing-related and persistent variances. Persistent variances are a warning sign that could indicate emerging problems in product lines, customer channels or vendor relations.
- Once we have this visibility, we model various scenarios informed by daily, weekly or monthly cash-flow and liquidity measures. These create a foundation for contingency planning. For instance, they can provide powerful insights into which rivals are vulnerable, which customers are strongest and which vendors might not survive. Unlike analyzing accrual statements, which are like reading yesterday’s news, cash focused analysis is forward-looking.
Hundreds of companies have relied on Treadstone’s cash and capital management expertise to help transform capital and liquidity management into a strategic platform of differential investment. Indeed, the downturn has only underscored the need for ongoing liquidity discipline and deep understanding of cash cycles. These inform the discovery of new and better ways to deploy scarce resources that strengthen business units, create desirable products, serve new geographies and meet customer needs better.