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Post IPO Turnaround

Client:

Major Transaction Processing Company

Division:

Entire Company

Contact:

CEO/Board

Major Functions:

BPO / Transaction Processing LOB, EFT LOB, ATM Management LOB, Risk LOB, Information Technology, Call Center, HR, Finance, Legal, Sales and Marketing

Situation

When a amjor US Corporation spun off a group of subsidiary units the IPO collapsed because of poor Management and execution problems.  The new entities stock price plunged from $16.00 to $8.00 per share. Additionally, an SEC inquiry was initiated into revenue recognition practices.

 The new management team engaged LoBue Group to evaluate entire global operating base including technology, sales and marketing, operations, organization structure and location strategy.

LoBue Recommendation

  • Restructure company with client-facing sales units and a shared services division for all back-end processes.
  • Consolidate, reorganize, and off-shore low value processing and centralize on-shore functions.
  • Migration of development activities to off-shore center of excellence.
  • Re-engineer all technology and operations functions.
  • Rationalize off-shore Contact Centers and employ state of the art practices.
  • Refocus sales and marketing departments and implement contact and pipeline tracking systems.
  • Re-engineer the global Telecommunications network.

Real Results

  • BPO and  LOB unit-cost reduction improved competitiveness and resulted in significant expansion.
  • Reorganization and establishment of consistent business processes resulting in dramatically improved efficiency of process operations.
  • Revitalized telecommunications network with significant new flexibility and reliability while reducing annual budget by several million dollars.
  • Dramatic improvement in Finance and Reporting operations and elimination of SEC issues.
  • Sale price of one business line significantly enhanced due to cost reduction in expense base.  Believed to be worth less than book price the business brought 2 times book.

The entire business was redesigned, including a realignment of the organization to improve market penetration, resulting in dramatically improved financial performance. Direct expenses reduced over $50 million and the $8.00 stock price improved to $21.00 by the end of the 18 month program.  The eventual sale of the company brought $32.50 pershare.

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