Case Study
Global Leader in Special Long Steel Products Unifies Two North American Forging Facilities, Delivering $13.6M Annualized EBITDA Improvement to Strengthen Liquidity and Covenant Compliance
$13.6M
Annualized EBITDA Improvement
Strategic Imperative
To rapidly increase cash generation and strengthen liquidity and covenant compliance across two North American facilities through lower unit costs, increased productivity, improved quality and on-time performance, and greater utilization of existing capacity
Client Background
- Global leader in special long steel products with 17 production sites, 60+ sales and service locations, and approximately 7,000 employees
- Board, lender, and liquidity requirements heightened urgency to improve EBITDA, working capital, cash flow, and predictable business performance
- Engagement centered on the North American business unit, employing approximately 950 people across two open-die forging facilities
- Business supplied forged specialty steels to automotive, oil and gas, mining, defense, aerospace, wholesalers, distributors, and direct customers
- Tariff shifts and planned volume transfers created urgency to prepare both facilities for increased demand without expanding installed capacity
- Reactive execution, past-due orders, high unit costs, and inconsistent profitability constrained the business’s role as a core investment
Key Issues & Barriers
- No comprehensive SIOP process linked sales forecasts, firm demand, capacity requirements, production schedules, and forward-looking financial performance
- Shift-level production expectations and schedules were not consistently published, limiting visibility to plan-versus-actual performance
- Neither facility had an effective System for Managing with disciplined reporting, escalation, evaluation, and corrective-action follow-through
- Management focused primarily on tons shipped, with limited understanding of profitable tons, contribution margins, capacity optimization, and unit costs
- Core operating processes relied heavily on tribal knowledge rather than validated standards, control points, set points, and documented routines
- Unclear accountabilities, cross-functional communication breakdowns, and inadequate variance coding obscured root causes and slowed management decisions
Key Implementation Components
- Developed a General Manager and leadership team centered on Business Principles, a customer-centered culture, and employee satisfaction
- Unified senior leadership and established a cross-facility SIOP and Supply Chain function with aligned Operations, Quality, Engineering, and Maintenance structures
- Designed and implemented a SIOP process linking forecasts, firm demand, existing capacity, forward-looking financials, and locked production schedules
- Validated control points, set points, and production standards to strengthen 4M readiness and absorb increased demand within existing capacity
- Implemented detailed variance codes, dashboards, visual boards, and escalation protocols to accelerate root-cause correction and schedule recovery
- Developed position profiles, expert models, scorecards, and leadership coaching to clarify accountabilities and shift management from reactive to anticipatory
Benefits & Results
$13.6M
Annualized EBITDA Improvement
150%
Productivity Increase
53%
Past-Due Order Value Reduction
60%
Reject Rate Reduction