What is this thing called 9Stucks?
9Stucks is a dynamic business diagnostic tool. It identifies nine distinct yet interrelated business challenges that cause a company to underperform.

“StorageCo” (Family-Owned Manufacturer)

The Diagnosis

Quick Facts:

  • Industry: Consumer Products
  • $65 million manufacturer of disposable packaging goods
  • 3 plants, 2 divisions
  • 100 yrs. old, family-owned, third generation
  • The Stucks (7): DitchSlow LaneAnother WorldRutFogMazeRough

What I Heard From the Leadership Team:

  • we need for an objective outsider to do an in depth look at the business
  • “we have a cost problem”
  • limited growth over many years
  • marginal profits
  • most personal assets of the aging family owners tied up in the business

What I Found After Digging In:

There was a mix of stuck stuff that had accumulated over the years…after all, StorageCo was 100 yrs old!

DITCH

  1. Family conflict over business focus and direction
  2. Struggling with how to transition to the 4th generation of family

MOMENT

Lots of sacred cows:

  1. Company’s original, slowly growing product lines were supposedly untouchable
  2. A long time, senior employee was disruptive and unproductive
  3. Family members in wrong roles
  4. Outdated, inefficient plant

SLOW LANE

  1. Overall management team was weak, lacking key skills in important areas
  2. Poor communication throughout the company
  3. Incentive systems only set up for a few employees

ANOTHER WORLD

  1. Rapidly changing industry and customer needs
  2. 3 of 5 business segments were flat and had tired products
  3. High potential growth segment not getting enough resources

RUT

  1. Taking customers for granted
  2. Not attentive to changing operational needs of customers (i.e delivery, quality expectations)

FOG

  1. Multiple product lines created unnecessary complexity.
  2. The overall business model created conflict amongst family members, added to the cost structure and pulled resources from more profitable product lines
  3. 3 of 5 product lines had low profitability (the 80/20 rule)
  1. The senior lender was upset with poor cash flow, growing inventories, low profits
  2. High capital expense requirements for ongoing maintenance and new equipment needed to remain competitive

ROUGH

  1. Hostile union
  2. Old systems
  3. Outdated processes that did not meet new customer expectations