Private equity investors expect the following:

1. Timely Exit: To exit an investment on time (with an IPO or sale of the company) at the highest possible value.
2. Profitable Initiatives: Executives who discover and execute profitable initiatives that make the largest impact in the shortest amount of time.
3. Value Creation: A constant reprioritization of initiatives in response to changing conditions (including the pandemic) with a focus on value-added projects and value engineering.
4. Operational Excellence: Project implementation happens at an accelerated pace by attracting and hiring highly-skilled people, pursuing processing rigor in operations, and implementing technological solutions wherever possible.

Why the Pandemic is NOT an Excuse for Poor Performance

Contained within every crisis is an opportunity. On the macro-economic scale, Amazon had to nearly triple its operating capacity in less than one year, which was expected to take another decade. On the microeconomic scale, a small restaurant owner prevented from serving clients inside the restaurant can focus on non-contact home-delivery and embrace a new marketing opportunity.

MarketWatch reports that the delivery-apps business doubled during the pandemic.

In this general category of delivery services, four companies include DoorDash, UBER, Grubhub, and Postmates, pulled in $5.5 billion in combined revenue from the early part of the pandemic in April 2020 until September 2020. These revenues were more than double the combined revenues from the same period during the previous year.

DoorDash has a 50% market share in home-delivery services. DoorDash reported that it had 435 million orders during the first nine months of the pandemic in 2020 compared to 181 million orders for the same period during the previous year. DoorDash took advantage of this surge in revenues to schedule its IPO on December 9, 2020.

Forbes reports that the IPO debuted at 12:45 p.m. (Eastern) and quickly rose by 86% from the offering price of $102 to $188 on the first trading day. This valuation made the private equity investors in DoorDash very happy, and those who exited at those prices were well-rewarded.

If any organization suffered an earnings loss in 2020 due to the pandemic, now is the time to consider strategies to make up for those losses. It is time to get back on track for positive value creation that private equity investors appreciate. The predicted, widely-deployed, mass vaccinations of most Americans, if completed by summer 2021, should make the balance of 2021 a banner year.

Here are some strategies to consider for making up lost ground.

Value-Creation Acceleration

Four strategies can be utilized to improve the creation of value, which are: 1) reprioritization; 2) focusing on high-impact projects; 3) reducing costs, and 4) project implementation improvements.

1. Reprioritization

Project reprioritization in the face of challenges is accomplished by creating a comparison matrix showing the impact on earnings versus each project’s difficulty level. Create a simple timeline diagram showing the impact on the EBITDA starting from zero on the vertical (X) axis and rising. Then, show the project placement on the horizontal (Y) axis timeline, from zero time going out to the right by monthly increments into the future.

The highest priority project initiatives are those that make the greatest positive impact on the EBITDA in the shortest possible time. On the matrix, the priority projects are high on the X-axis while also being low on the Y-axis. By charting each project on such a matrix, it is easier to see which projects take priority over others.

2. Focus on High-Impact Projects

Take a second look at the matrix developed in step 1. Draw a red vertical line on the Y-axis to represent the month when the equity investors expect to exit. To the left of this line are projects that can be done in time for the exit. To the right are projects that are estimated to take longer.

If there are attractive projects with a highly positive projected impact on the EBITDA that fall outside of the exit deadline, make an effort to re-evaluate them.

Determine if a greater allocation of resources can advance the initiative more quickly to meet the exit deadline or if there are any ways to reduce the difficulties and still accrue as much benefit as possible. Perhaps, a project can be broken down into stages that allow benefits to accrue prior to completing the full implementation.

3. Cost Reduction

Cost reduction initiatives are essential. It is vitally important to the survival of an enterprise when the organization is under a severe market challenge, such as a pandemic. The best practice for cost control is to use value-added/value engineering (VA-VE) to reduce cost and eliminate waste to achieve operational excellence.

For most manufactured products, material costs represent the majority of the cost of the goods sold. The VA-VE method is more impactful than only improving purchasing strategies to reduce costs. An analysis is made of product and packaging design, along with transportation costs. A product or packaging design might be changed to adjust the materials, components used to make it, and transportation logistics.

The goals of a VA-VE strategy is to take a hard look at how things are done and not be restricted to doing things the same way that they always have been done when improvements can be made in the design or processes.

A few ways to analyze VA-VE opportunities are:

• Make an analysis of the parts count for each manufactured product to see what can be eliminated, consolidated, and standardized across an entire production line.
• Conduct a thorough margin analysis to discover insights into products with low margins that can be eliminated.
• Liquidate non-performing inventory.
• Extend any discovered VA-VE savings for a specific product across an entire product line or the entire enterprise.
• Outsource processes that are not done efficiently to more efficient production partners.
• Re-evaluate all transportation logistics.

4. Project Implementation Improvements

Project initiatives that make a positive impact and can be implemented quickly should be done as fast as possible. Smaller returns from quickly implemented project improvements add up to a larger positive impact on the EBITDA.

Here are some helpful strategies to consider when making project implementation improvements:

• Initiate more projects in parallel to make up for the lost time.
• Focus on the points that create the maximum positive impact with the engagement of the front-line workers.
• Stay focused on the big picture and do not get bogged down with the minor details.
• Track progress with high visibility for all constituents and stakeholders.
• Leverage all synergies possible by driving success with a leader who serves as a powerful change agent with the full support of upper management and actively-engaged employees.
• Use proven process improvements and deploy the most helpful support technology.

Summary

A major challenge, such as the pandemic, is rife with an opportunity too. The powerful motivator of responding to an emergency can be focused on project initiatives to make up for the lost time. Companies, who experienced a loss of momentum, have to adjust rapidly and become reinvigorated to move forward on the most valuable project initiatives right now. Focus on cost reduction, earnings generation, and continue to strive for operational excellence.

The superb news is the stock market is prepared to overly-reward excellent performers with high valuations. Yahoo Finance called the DoorDash IPO amount of $32.4 billion at the IPO price of $102 per share the “most ridiculous” valuation in 2020. Private equity investors in DoorDash, of course, disagree with Yahoo’s opinion. The stock market thought DoorDash was worth almost double that amount ($188 per share) on the first trading day!

Without a crisis of this magnitude, the momentum for change would not have risen to such a fervent level. The crisis demanded absolute agility, resiliency, and cost management. This article explores how to use this momentum as a springboard to increase cash velocity, continue to improve cash management efforts, optimize supply chains, and achieve operational excellence that results in value creation…Click here to read the complete article or Click here to Download a PDF Copy.

FlexJobs reports that the growth of remote workers increased for the past five years before the pandemic. Remote work steadily increased by about 8% year-over-year from 2015 to 2019, then suddenly everyone had to work from home. In 2019, about five million Americans worked remotely. This was about 3% of the total employed in America.

After the pandemic hit in 2020, 64% to 85% of employees worked from home. This represented up to 100 million workers. The growth was suddenly off the charts with up twenty times more remote workers than the year before. The response to the pandemic proved that sudden, dramatic change is possible.

In 2020, Statista surveyed CFOs to ask them how many of the newly-created remote positions will continue permanently. About half of the CFOs said that at least 10% of the newly-reorganized positions would remain remote jobs after the pandemic subsides. A quarter of the CFOs said that the newly-created, permanent remote jobs would be 20 to 50% of the pandemic levels. This change was a huge surge, and it will not go back to zero after the pandemic passes. Probably remaining will be between 10 and 50 million newly-reorganized remote positions.

Another example of massive sudden change is the growth of online sales that Amazon and other big retailers experienced. The growth rate from the pandemic nearly doubled Amazon’s sales by May 2020. This growth over a few months was expected to take another ten years to achieve. The surge in demand was not all rosy either. Shipping delays, mistakes, and the policy Amazon implemented for the early part of the pandemic, of only accepting essential items for sale for its member-vendors, harmed many companies who sell on Amazon.

Those are just two examples of gigantic changes. There are many others. About 86% of CEOs now say their companies are undergoing major changes.

Change Transformation

The changes caused by the pandemic were forced upon us; however, it is the way that companies dealt with the market changes that determined whether the companies thrived, survived, or perished. Transformational change is better when driven as a business strategy, not a reaction to unplanned outside forces. No matter what, CEOs have to deal with change.

Now, it is reasonably clear for most companies the extent of the pandemic’s impact on operations. Moving forward, transformational change will come in two phases: 1) adapting to the full extent of the pandemic and; 2) planning for the post-pandemic environment that starts sometime in late 2021 after widespread vaccination. Moreover, long-term planning must consider what would occur if another pandemic hits and the impacts of climate change. All of these dynamics create the need for ongoing change management.

Change as Continuous Improvement

A new motto for the vast majority of organizations should be “Change is Job One” (with a tip of the hat to Ford’s old slogan of “Quality is Job One”). The reason why change management has become the priority is that the changes occurring are not isolated. Change is not happening in one company or industry sector. Changes now occur across all companies in all industries in the entire world at a pace that is accelerating with no end in sight.

To maintain continuous change, at this pace, requires a new approach. A change agent, whether it is a C-level executive, project manager, or a hired external consulting team, must deal with the practical matters of change resistance and move past blockages that prevent changes from being implemented.

How to Unblock Change

First, to unblock change, identify the obstacles and problems, and then try the following suggestions for strategies to work with these circumstances.

Here are the common obstacles and problems.

• Reduced Resources: External forces, such as the pandemic, cause a sudden reduction of resources. This drives the change initiative, including corporate restructuring, downsizing, cost containment, and, in the worst-case scenario, bankruptcy proceedings with a corporate reorganization or the liquidation of assets.
• Costs and Return on Investment (ROI) Considerations: Estimating the cost of the change must be done and a calculation made of the estimated return on investment. However, many changes are driven by factors that are not determined by the cost, and some needed changes have no ROI or have a negative return, yet must be done for the company’s survival.
• Fear of Failing: Fear is a strong motivator and can cause indecisiveness about making a change. Fear makes it more difficult to decide if it is the correct change and to determine the proper scope of the change needed.
• Employee Resistance: Human beings naturally become complacent and almost instinctively resist change.

Here are the strategies to consider for each type of problem listed above. The strategies can be used in combinations if there are multiple obstacles.

• External Support: When internal resources are limited, or you do not have the capabilities needed, the appropriate way to manage a change initiative is to bring in external support to make the changes happen. An external team provides a more neutral perspective. This helps when forced to make difficult decisions such as furloughs, layoffs, and downsizing. Often an external team can better prepare a plan for limited-resource reallocations. The external team can handle the changes needed while a reduced internal team manages the continuing operations.
• KPI Tree: A KPI tree is a graphical representation of key performance indicators. This system works by showing the relationships between lower-level indicators that measure activities and high-level financial goals. As a transformational change is underway, the results can be tracked as financial gains using this system. The KPI tree identifies accountability, the person who makes each decision, and the financial contributions of activities and business processes. This effort works by mapping the KPI tree and then training the employees to work with the KPIs.
• A.L.I.C.E.: Overcoming fear and determining the scope of a change initiative can be aided by using the A.L.I.C.E. method, which stands for 1) Articulate the problem; 2) List the ways to solve it; 3) Identify the means to do the work; 4) Capture the enablers needed to create the change, and; 5) Evaluate interdependencies and synergies. The transformation area and the scope of the change are decided by analyzing physical constraints, functional areas, and organizational effectiveness. Another important way to overcome fear is to reject inappropriate self-censorship that creates a pessimistic mindset. Instead, have confidence, formulate a bold vision for the company, and create a strategy of achieving the goals, while understanding what will be the challenges.
• Put Resistors in Charge: Rather than let highly-influential resistors within a company block the change, enable them to make the change and put them in charge of the process. Acknowledge the fear, show empathy, be honest, gain trust, and strengthen the team’s relationships between those responsible for driving the change. Be sure that key players know what benefits they personally get from the change that makes sense for that individual, which may be completely unrelated to the transformation’s overall objectives.

Conclusion

One thing is certain, change is here to stay, and it is accelerating. People don’t change just because they are told there is a better way to move forward. Instead, change is often forced on them when they realize that not making a change will not work. As a leader, you should see change as inevitable and embrace it as continuous improvement to make your company thrive.

Let’s take a look at a company’s culture and its creation and how to make its culture performance-based.

What is company culture?

A company’s culture is its identity comprised of its employees’ attitudes, beliefs, and values.

A company’s culture is somewhat intangible because it derives from formal rules in combination with the informal understanding of the people who work there. Culture encompasses knowledge, know-how, official rules, and agreed-upon norms of behavior.

The rules do not drive the culture. The culture arises from how individuals and groups within an organization respond to both the official rules and non-official yet compelling norms. Click here to read the complete article or Click here to Download a PDF Copy.

There are three commonly-used ways to analyze a company’s value.

1. For a publicly-traded company, market capitalization (market cap) is the value. The market cap is how much all the outstanding stock is worth at the current share price.

2. For a private company, the value can be estimated by using some multiplier, which is industry specific, times the earnings before interest, depreciation, and amortization (EBITDA). This gives an estimate of what most investors would think the company is worth.

3. Another way to value any company (public or private) is by calculating the economic profit. Economic profit is the profit less the cost of the capital used to create it. For comparative purposes, calculate the economic value-added (EVA), which is the net profit after taxes, minus the opportunity cost of the capital invested in the company.

Research conducted by Stern Stewart on companies that focus on creating EVA growth discovered that they usually outperform the market and competitors consistently, in terms of valuation. When the EVA of a company increases over time, the value also increases. Click here to read the complete article or Click here to Download a PDF Copy.

The wizard seems all-powerful until a closer look behind the curtain reveals strategic intent, intense due diligence, rate of return, and PE deal mechanics. What was once germane or even occult to entrepreneurs becomes clear when value creation is a shared objective where private interest and the middle market intersect.

Senior Transaction Advisors, leadership’s upper echelon who are often-times Managing Partners and/or Co-Founders borrowing extensive experience from investment banking in tandem with M&A, spend decades practicing in growth-stage equity, buy-side transaction execution, industry roll-ups, and business valuation. Click here to read the complete article or Click here to Download a PDF Copy.

Clutch recently released their list of the top highest-ranking change management consultancies on their site. This effort is part of Clutch’s Small Business Solidarity program. We are excited to announce that Avaltos has been listed among the leading change management consulting companies on Clutch!

Clutch is a market research firm headquartered in Washington, DC that features leading B2B companies. Their team interviews the former clients of B2B service providers and formats their comments into reviews. This direct feedback ensures that all of their ratings, rankings, and awards are fair and transparent.

We are also featured on The Manifest, an affiliate site of Clutch! The platform helps guide users through each stage of the buying process. The Manifest features shortlists of B2B companies and company project descriptions according to geographic location and service line alongside business survey data and how-to guides. We are thrilled to be among the top supply chain companies on the Manifest!

“Due to automation and globalization, the workplace was already highly dynamic prior to the pandemic,” said Clutch Analyst Dustin Sammons, “However, COVID-19 has even more radically changed how we all work, and companies often need outside perspective and advice in terms of how to navigate these unprecedented times.”

We are thankful for each and every one of our amazing customers, especially those that took the time to leave us a review on Clutch.co! We always love to hear feedback from our clients. Here’s what they had to say about their time working with us.

“Avaltos was very confident, which we needed for this project.” – VP of Strategic Procurement, Food Brands Company

We have appreciated the opportunity to work with so many wonderful partners over the years. This Leader Award was made possible by all of your support!

To learn more about us, check out our Clutch profile and read reviews left by our customers. Ready to get started on your next project? Contact us.

Fund backers continue to glean data from portfolio company stress tests. Run a magnifying glass over a Private Equity firm, and you’ll likely see analysts busy tinkering with a range of predictive problem solving, forecasting ups and downs in sales, revenue, and after-tax earnings. What if sales were to rise by 50%? Or drop by 30%? What happens when we play around with cost optimization principles? Good questions yield great intel, especially among limited financial models in which to base future action.

Main portfolio company approaches help mitigate obstacles to the equity fund’s functional progression, but on a smaller scale. By no means are they any less vital than gathering, cleansing, and extracting stories from the data analytics. Firms, must ensure the availability of liquidity and have the ability to measure the impact of supply chain conditions at a moment’s notice.

The bright side is that PE fund managers can use productivity and process enhancements and other value creation sources to drive returns irrespective of the macroeconomic environment. Here are four guaranteed ways of achieving exponential growth and profitability in portfolio companies.

1. Operational Enhancement: Top Down

Previously, quantitative engineering played a significant role in strategic development. High leverage defined organizational direction. Somewhere along the line, operational excellence took precedence for top-line performance optimization and efficiency. Enhanced structural operations with a concentration on human capital guide exponential growth.

Systemically and consistently generating double-digit percentages remains closely tied to the tactical arrangement within executive leadership. PE strategists could increase the equity stake and improve incentives based on the profile of each team member. The ability to attract, retain, and motivate top talent in the field with exit proceeds pre-planned keeps you competitive. The rapid change brought on by new incentives and new management strengthens board-level leadership. These managers must prioritize democratized communication among portfolio company hierarchies.

Bear in mind, quality management retains quality metrics. Root cause analysis – a handy methodology that identifies areas of improvement – can serve as a springboard to accumulate a comprehensive set of tools and resources that break down obstacles to internal proficiency.

2. Pricing Optimization

Investment friendly indicators should point to the need for an increase in margins, meaning significantly higher EBITDA and returns as a net result. Effective pricing protocols, call attention to the relationships between customer value, volume, and price negotiation power within the framework of each portfolio company.

It may be wise to ask some questions like: is there a pricing strategy in place? Are hidden costs and discounts causing losses? What does cash flow enhancement look like?

Arranging a beneficial cost-plus model under the supervision of Finance seems like a good first step. A capable sales team will give you an in-depth tour of the opportunities afforded to you when sales models closely match stated objectives.

To achieve sales effectiveness, they conduct a review of the following:

• Market opportunity segments
• Process mapping
• Resource deployment
• Productivity measures
• Compensation

However, the paradigm shift occurs when the pricing team is able to extract and utilize rich sources of information to build a pricing strategy based on customer research, cost optimization and micro-segmentation.

The simple, yet effective move in price showcases the power of market perception. And it shows in the numbers. While a reduction in business related costs yields a 2-5 times return depending on the company, EBITDA leverage improvement pushes those numbers up to 10-12 times respectively. Investment in a pricing program is hereby deemed critical for portfolio success.

3. Maximize Portfolio Value By Outsourcing

Support operational cost reduction could mean going outside the bounds of the organization to construct new partnerships with talent ready to tackle the legal as well as financial complexities of each company in the portfolio.

Maintaining skilled third party solutions teams has been shown to reduce expenses, but frees up human capital so more attention is placed on fund performance. Stand-by finance and accounting teams reveal new value creation pathways. In addition, they solve a number of issues related to portfolio company value:

• Lack of adequate staffing
• Bad reporting/inadequate communication
• Outdated system processes

In-house staffing serves its purposes, but for the sake of the topline, and given that efficiency is top priority, and considering regulatory frameworks such as the Alternative Investment Fund Managers Directive (AIFMD) & the Foreign Account Tax Compliance Act (FATCA), the case for outsourcing tasks to service providers grows ever so larger. The use of available technologies is quickly becoming a sign of operational excellence in the face of the portfolio company and its competitive effectiveness.

4. Marginal Expansion

Growth by merger and acquisition isn’t only condoned but encouraged when on a path toward revenue enhancement. There’s a downside to this kind of model – revenue leakage, and it is of the highest priority for analytical engagement. Putting a stop to this functionally debilitating processes in business is a great way to ensure sustainability; that growth and profitability are long-term.

Before recovery and assurance are achieved, the source of the revenue leakage must be determined…and there are many, unfortunately:

• Sub-par pricing
• Insufficient sales
• Inefficient billing
• Sub-optimized discounting
• Lead time mismanagement

Prevention is key, but there is a process for identifying and mitigating the leaks:

• Identify underlying issues
• Collect the data
• Quantification
• Run Root Cause analysis
• Implement improvements
• Measure impact

PE fund managers can go about increasing portfolio value and make their contributions by cash flow enhancement..keeping in mind revenue leakage; improving profit through efficiency or product repositioning; and a heavy reliance on the strength of corporate governance.

Value Creation

Value creation comes from a focus on initiatives that have a high positive impact on EBITDA. Time is of the essence. Booking earnings right now, during the short-term, is vastly more valuable than building earrings growth in some distant future. Every project initiative being undertaken by a company, which is either ongoing or planned, needs to be re-evaluated based on the projected earnings that can be generated, and the timeframe needed to garner such earnings.

The focus is very short-term and must be on initiatives that create a positive impact on EBITDA over the next fiscal year. The evaluation and ranking of initiatives need to be honest and reasonable in light of current market conditions.

This is best shown as an overview by using a matrix graph with the X-axis representing the positive impact on EBITDA (on a scale of one to 10) and the Y-axis representing the time needed for the initiative’s implementation (of one to ten months) with four quadrants, which are:

1. 1. Upper Left Quadrant – High EBITDA Impact/High Priority: These initiatives take less than five months to implement and have a very high (more than a five ranking on a scale of one to 10) impact on EBITDA. The absolute best projects will take less than one month to implement and have a 10 score as a positive impact on EBITDA. Few companies have such a beneficial project at hand; however, all other initiatives are graded according to this imaginary reference. Priority initiatives take less than five months to implement and score more than five for making a positive impact on EBITDA.
   2. Lower Left Quadrant – Low EBITDA Impact/Easy to Implement: These initiatives do not have such a positive impact on EBITDA and are ranked at less than five (out of 10) for EBITDA positive impact; however, they are very easy to implement. This means making efforts on them may be beneficial if there are not better alternatives that require the same resources.
   3. High EBITDA Impact/Difficult to Implement: These initiatives are worth considering due to the high positive impact on EBITDA when there are no other similar projects that are easier to implement.
   4. Lower Right Quadrant – Low EBITDA Impact/Difficult to Implement: Any initiative that ends up in this category should be avoided, postponed, or simply canceled. This is a source of major disruption from before when things were going along as usual, so it may be challenging to make these adjustments. Companies that can avoid working on such initiatives have a better chance of improving their valuations than others that do not make such an effort.

For initiatives that fall outside of the ten-month time horizon, they can be revisited to determine if there is any possible way to reduce the time needed to get the improved earnings benefit, even if only a partial benefit. Perhaps, the scope and depth of the initiative can be adjusted while keeping all the success parameters intact. For example, a national roll-out can be reduced to a regional roll-out or an in-person effort can be taken online as a virtual effort. The goal of this process is to make highly-positive initiatives more achievable in the short-term.

Consider the following factors in making the analysis:

• Can you speed up the timeline of any high-positive-impact initiatives?
• Can you reduce the difficulties for initiative implementation?
• Can you can adjust the scope or size of the initiative while maintaining a positive benefit?

Cost Optimization

Cost optimization is always an important factor in sustaining profitable operations. When earnings are hampered, it may require taking drastic measures to re-balance the cost structure of the operations. For example, product manufacturers may have a chance to improve purchasing strategies and production methods to improve the cost basis of their products.

One technique to consider is value engineering (aka value-added) cost structures. This method analyses product design, how a product is manufactured/sold/packaged, and looks for ways to improve the overall process. It may include altering components and materials used for product manufacturing. Under normal operations, these things have a tendency to be neglected, overlooked, or assumed to be too challenging to address.

To address these issues, it is usually better to hire outside consultants to review the manufacturing process from materials acquisition to the final product. They can more easily see the things that can be done and make recommendations for improvement. Consultants trained in value engineering look for design, materials, and manufacturing/sales process changes that can be implemented within a short timeframe using available resources. Similar efforts apply to service businesses and other organizations of all types.

In addition to cost analysis, value engineering techniques include:

• Outsourcing recommendations of external processes that can be used to better focus internal staff on core competencies.
• Components list analysis to help identify things that can be consolidated or removed.
• Competitive pricing analysis to discover opportunities for market share expansion.
• Gross margin analysis to uncover things that are more profitable.

Value engineering can start with a specific project initiative and then be applied across the entire organization.

Cash Flow Enhancement

Positive cash flow is the lifeblood of every business. Sufficient cash flow is needed to cover expenses, pay debt service, reinvest in the business, and pay dividends to investors. Cash flow enhancement comes from using the best practices for account receivables management to accelerate cash usage. The goal is to increase a company’s liquidity.

Eleven ways to improve cash flow are:

1. 1. Accounting: Send invoices immediately.
   2. Cooperatives: Create a buying cooperative for economies of scale.
   3. Credit Checks: Screen customers for credit worthiness.
   4. EFT: Accept electronic payments.
   5. Factoring Receivables: Take a cash advance on receivables to buy inventory at a discount and/or to increase sales volume and exploit profitable opportunities.
   6. Inventory Turnover: Increase inventory turnover and liquidate inventory that cannot be sold.
   7. Leasing: Lease equipment instead of making a capital investment.
   8. Leverage: Take advantage of leveraged opportunities by using as little money as possible and maximize the use of internal resources. Identify synergies between staff, processes, and enabling technologies.
   9. Payment Discounts: Offer discounts to your customers for the early payment of invoices.
   10. Raise Prices: Increase prices through value-pricing strategies.
   11. Supplier Discounts: Negotiate discounts with suppliers.

Operational Excellence

Operational excellence comes from focusing on what can make the greatest positive impact on EBITDA. Then, accelerate the implementation of those project initiatives. Every boost of EBITDA that can be accomplished in the short term thorough cost reductions, value engineering, and cash flow management should be fervently pursued by the company.

If possible, execute initiatives in parallel rather than in series to reduce the time needed to improve earnings. Move quickly and avoid any projects that could bog down without producing results. Track success and make this effort highly visible to staff so that everyone is in an “all hands on deck” mentality with the awareness their intense efforts right now can save the enterprise from failure.

Conclusion

It is time for companies to intensify efforts to improve earnings to recover lost value as rapidly as possible. The main takeaway from these suggestions is to focus on a shorter timeframe and improve earnings as fast as possible. Think about what can be done right now to improve EBITDA. Then, move rapidly and efficiently toward the initiative implementations necessary to accomplish that goal.