SG&A Transformation: How CRG Enabled $10M in Annual Savings for a Global Manufacturer 

The Challenge

In a competitive landscape where operational efficiency distinguishes market leaders, CRG engaged with a global manufacturing client facing a significant challenge; their Selling, General, and Administrative expenses (SG&A) were outpacing revenue growth by 22%. The objective was to identify and implement cost management strategies to achieve operational efficiencies

The Approach

CRG embarked on a structured, three-phase approach designed to address the unique challenges faced by the manufacturer: 

Phase 1: Mobilization & Insightful Discovery 

• Established project objectives, success criteria, and a comprehensive communication plan, ensuring alignment with the client's strategic goals. 
• Conducted a thorough analysis of SG&A expenditures to identify cost drivers. 
• Benchmarked the client’s operational practices against industry standards to refine cost allocation and accuracy. 
• Engaged with departmental leaders to unearth potential areas for operational improvement. 
• Identified and prioritized specific functions for in-depth evaluation, setting a clear direction for the analysis and intervention phases. 

Phase 2: In-Depth SG&A Functional Assessment 

• Undertook a comprehensive review of company operations, conducting detailed interviews with over 60 employees across various departments to understand existing processes and identify inefficiencies. 
• Analyzed current workflows and associated effort to separate value-add from non-value-add activities, establishing a foundation for improvement. 
• Identified 195 distinct operational challenges, pinpointing their root causes to inform the development of targeted solutions. 

Phase 3: Strategic Recommendations & Implementation Roadmap 

• Developed a set of 95 customized recommendations aimed at optimizing SG&A efficiency and enhancing overall operational effectiveness, supported by detailed business case analyses. 
• Projected future workforce requirements, aligning them with expected changes in revenue and business demand to ensure a sustainable approach to cost management. 
• Formulated comprehensive, phased action plans for each key operational area, providing clear guidance for the effective implementation of recommendations. 

Outcome

The collaboration between CRG and the manufacturer resulted in actionable solutions: 

• Delivered a detailed analysis of SG&A spending trends and cost components, providing the executive team with critical insights into operational efficiencies. 
• Identified 195 areas of operational inefficiency, laying the groundwork for targeted and impactful improvements. 
• The strategic recommendations facilitated a 16% improvement in workforce efficiency, equivalent to 42 FTEs. 
• Achieved an annual SG&A cost savings of $9.6 million, directly attributable to the implementation of the 95 targeted recommendations. 

CRG's engagement with the manufacturing client stands as a testament to our ability to convert complex challenges into strategic opportunities. By combining thorough analysis with actionable insights, cost savings were identified to pave the way for sustained growth and efficiency.  

Explore how CRG can unlock the potential within your organization, where insightful strategy meets operational excellence.