CASE STUDY:
BUILDING A NEW DIVISION FOR A F500 COMPANY – FROM BOARD PROPOSAL TO $250MM REVENUE IN <TWO YEARS
The Situation...
After successfully revitalizing the consumer printer division for Lexmark, Steve was asked to create a business plan to penetrate the “Small & Medium Business” market.
Challenge
After 10 weeks of qualitative and quantitative research, Steve presented a plan for an industry-segmented approach, focused on market opportunity, customer needs/gaps, and product capabilities and competitive advantages. The three primary industry verticals were: Community Banking, Regional Pharmacies, and Direct Mail processors. Upon Board approval of the business plan, Steve was asked to build out the team to create this new division and deliver on the results outlined in the plan.
Action
Steve was given the ability to hand-select a leadership team, from internal and external candidates – including heads of product development, sales, and marketing. All other functional leaders were included as dotted-line reports from within the existing Lexmark team (R&D, Manufacturing, Packaging, Finance, etc.) Within three months, the combined team was fully operational and had already identified specific solutions for each industry vertical – MICR printers for Community Banks, Specialty Media for Pharmaceuticals, and Daisy-Chain software/hardware for Direct Mail processors. After six months, the product solutions had been developed and the go-to-market strategy was confirmed: specifically, an outside sales team was identified and put under contract, and marketing was executed through industry-specific vehicles – trade publications, industry conferences, etc.
Result
Within 18 months, the new division was generating ~$250MM in annualized revenue – well exceeding initial projections. Further, the team was able to leverage existing staff and products more than originally anticipated which yielded higher gross profit margins.