Andrew Csicsila
Partner & Managing Director, Co-Head of Americas
Chicago
In the final weeks of December, Alixpartners received a phone call from a large beauty company’s executive who had previously heard about AlixPartners’ capabilities in value creation. The global company had a number of challenges and they mentioned needing help on some headcount reductions. We quickly deduced that the challenges the company was facing would require more than small headcount reductions. The company had flatlining sales globally, select brands were experiencing sharp declines, and costs ballooning in several areas of the P&L from a percentage of sales and overall dollar amount standpoint, including: COGS, SG&A, marketing, sales, personnel, and E&O. The street had taken notice and the company’s share price had extravagant erosion.
AlixPartners proposed a much larger program to help stabilize the company and position it for growth. Prioritizing what was hypothesized to be the most impactful work quickly, a QuickStrike Diagnostic to look into improving the company’s operating model and third-party spend across multiple regions was suggested along with doing a full workup in one particularly underperforming region where a management plan was proposed that looked unlikely to realize. By the first week of January, AlixPartners had teams on the ground in the Americas, Asia, and EMEA.
A global coordinated effort was stood up to design and implement a transformation program that could track globally and drive impact locally. The result of the six-week Quickstrike pointed to a number north of $100M in improvement with >50% realization in year possible based on the early fiscal year start. Several management changes took place, and the AlixPartners team partnered with the new leadership and working teams to execute the plan that had been developed.
After nine months, more than $200 million in EBITDA improvements had been implemented. A leaner more transversal organization was in place across G&A, marketing, sales and operations, and all spend categories had been sourced with best procurement practices put in place, and increased spend under procurement’s control. The infrastructure had been built, and the muscle developed, for the company to continue on with the transformation program that AlixPartners established with teams across the world. Following the first phase of the global transformation, a strategic plan was shared that would help drive the next round of savings and help return the company to growth.
$200M+
EBITDA improvement
