Explore the challenges faced by a Brazilian company in the commercial vehicle market, as it navigates through a crisis without recognizing early signals. Learn how strategic intervention, process reevaluation, and a proactive approach to succession planning are crucial for survival.

The case study serves as a valuable lesson in crisis management and the importance of recognizing early warning signs. From inefficient production practices to the need for succession planning, the blog highlights the multifaceted approach required to navigate a crisis successfully. Companies are urged to learn from this example and prioritize transparency, optimized administration, and strategic planning to ensure long-term prosperity.

In 2012, the economic situation in Brazil was still largely unproblematic. The country had the longest phase of an economic and social upswing in democratic times behind it. The financial crisis of 2008-2010 had been overcome extremely well, without really causing major upheavals. A new sociological- economic middle class had emerged in the context of the emerging global economies.

Starting in 2014, Brazil's situation deteriorated rapidly and an economic downturn occurred, which has not really stopped until today.

After one year, growth of over 25% was achieved at the beginning of 2017 and profits increased by 100% compared to the previous year. The installed simple financial control system improved efficiency and cash flow in the small local coffee store chain. All installed coffeeshops were back in the blue zone.

A global company specializing in property facades and energy efficient windows and doors executed the most emblematic projects in Brazil, but the company had not returned a profit from its Brazil office since 2001 and had recognized that a strong brand and quality product were not enough to succeed in the current market. The company’s headquarters in Europe was considering closing the Brazil office. However, it also recognized that Brazil is an emerging market with a large social middle class and an average age of 29 years, making this a potentially lucrative location if a successful turnaround could be executed. The business model is not matching to the local requirements. To survive, the model would have to be adapted, which would seem to be contrary to the European standard. Is that feasible?

How dangerous can paradigms be in a crisis?

Can an industry-wide paradigm lead to business blindness? Under what conditions has a paradigm developed?

If you think about costs too late, you ruin your company. Those who always think about costs too early kill creativity. Cost-cutting measures must be taken when you are earning a lot of money. Once you're in the red, it's too late. Many years of experience can sometimes narrow the view. There are people who think they know the bird very well because they have seen the egg from which it crawled out.

Sometimes you have to pull out trees to see if the root is still there. After many years of the paradigm of uncompromising outsourcing of all functions, we realize after many projects that this way has to be decided anew in every case and has to be checked at regular intervals for its still existing advantages. Paradigms must not be retained for convenience.

But to make a powerful decision, we turn the data into information. Our 360-Degree Program is not only so useful for your company because it contains a new insight, but because it covers all areas that need to be considered. Your data becomes information, we answer questions, we create a profound information basis.