A multinational manufacturing corporation had struggled for a long period with low operating cash flows and high working capital ratios.
Performing a QuickScan of the situation revealed that there were no consistent processes in place and optimisation efforts were carried out selectively and from time to time. Due to unclear responsibilities, no one was held accountable for this issue.
Our financial expert team helped by clearly identifying the main levers to improve the working capital and by clearly defining the critical processes, responsibilities and actions to be taken. In this case, the focus was put on the order to cash process, purchase to pay process, inventory management and indirect tax optimisation.
After implementation of the agreed actions the main drivers of working capital were visible through a monthly reporting system, clear responsibilities and targets were defined to actively manage the level of working capital. Overall that led to a lower level of working capital and thus a higher operating cash flow.