About the Client
EST Group is a reseller of computer products, as well as a technology consulting firm specializing in perimeter security. They service verticals such as education institutions, businesses, government and healthcare organizations.
In part due to a lack of clarity in EST’s reporting, timing, and insight into cash flow, EST Group wasn’t able to fully understand the constraints they were facing. As a result, they were experiencing a meaningful reduction to their net profit. On top of that, their reseller agreement was under tremendous pressure from one of their creditors. They were in desperate need of insight into their financial situation and potential options. On the consulting side, the firm experienced turnover that impacted leadership, day-to-day direction and execution of projects.
With 30 years of turnaround experience, CFO Craig Schwimmer jumped on the opportunity to assist EST Group. During the project, Craig helped the firm understand that the budgets and goals they were setting weren’t beneficial.
“For example, they assumed demand would be a certain number of billable hours on a yearly and monthly basis, and that number continued to drift south. This was happening partly because the operating group at the consulting level wasn’t driving towards realistic and sustainable goals.”
The first presentation Craig gave to the organization centered around how they were losing money every hour. In order for the leadership team to fully comprehend the gravity of the situation, Craig needed to be blunt and honest. After the initial shock and disbelief wore off, the team was eager to work towards the necessary changes.
The EST Group project started as a roadmapping exercise. After evaluating their corporate structure, roles and responsibilities, compliance procedures, checks & balances, and technical A/R + A/P processes, Craig built a roadmap for the future.
First on the roadmap was annual budgeting. This workstream started with drafting, iterating upon and finalizing a revised annual budget. It also comprised building easily-updated templates at the more granular Business Unit (BU) level budgets, resulting in streamlined consolidation into overarching corporate views. Once the budgets were in place, informative reporting and KPI dashboards / ‘flash reports’ were developed.
Over the course of approximately 18 months, Craig worked with EST Group to ensure that the roadmap was followed – making adjustments as needed, ensuring deadlines were met, and aligning the team at large. He also tackled a slew of new projects and strategies as they arose.
EST Group went through a reorganization, and the consulting firm was spun off and sold to a different business. To facilitate the sale, they created an independent set of financial analysis and financial performance standards: profit and loss, cash flow, and income statements.
With Craig’s leadership, a level of clarity swept across the team. Tightening up the definitions of metrics, eliminating underperformers, ironing out kinks and streamlining processes allowed the company to turn around their performance, gain more value, and ultimately led to its successful sale.