Situation

$700M+ PE backed global medical device company in transition. Transition process challenged by problematic ERP conversion resulting in disruption to A/R and cash collection process. Cash flow issues caused significant supply chain disruption. Company needed to unlock cash and free up their supply chain quickly while placing customers on allocation during the remediation process.

Action

Working with in house operational support staff, performed rapid diagnostic to quickly determine sources of A/R disruption in US and International operations and develop plans to remediate. Parallel activity to accelerate cash collection and apply cash to selective vendors in order to restart production on a prioritized basis. Cash remediation activities were mainly focused on dispute resolution primarily driven by erroneous invoices or cash application issues where cash was received but not applied due to matching challenges. Company developed a robust 13 week cash flow forecast to support financing and allocation discussions during the critical remediation period. Senior executive transitions occurred in parallel.

Result

Root causes and remediation plans were identified within 30 days of project start. Funding was secured to support the business through the remediation period. The supply chain was unlocked and production restarted quickly enabling the company to resolve product availability challenges in short order. Cleanup activities to resolve cash collection issues were executed systematically.