Case Studies

M-Tec

Manufacturer

Elkhart, IN

The Situation:

From it’s founding in 2003, M-Tec experienced rapid, debt-free growth. In 2006, the company recognized several market opportunities that would allow it to both diversify its business and acquire new capabilities. At the time, M-Tec was using a local bookkeeper for basic month-end services and had an administrative person on staff performing all of its other back office needs including payroll. In addition, M-Tec was banking with a small, local bank that had been an important partner in its start-up phase, but lacked the capacity to fund future growth.

That summer, M-Tec simultaneously acquired a company and launched a new division. Despite plenty of pre-planning, both the start-up costs for the new division and integration timelines for the acquisition got off track. Furthermore, M-Tec’s new lender that provided the financing for both moves began pressuring M-Tec to hire a controller in order to provide better financial controls and reporting. Despite the bank’s pressure, the management team at M-Tec did not feel it required the services of a full-time controller, but rather needed help with sales and on the floor. Hence, instead of searching for and hiring a full-time controller, M-Tec elected to outsource its entire back office function to Reach360 (note – it was Banks Corp at the time, not sure if we should change chronology to accommodate).

The Approach:

Reach360 evaluated the services provided by the current bookkeeper as well as the demands from its new lender. In addition, it looked at the current HR practices in place at the time. Like many fast-growing companies, M-Tec was focused on sales and operations and the administrative work was left to the office manager. As M-Tec grew, so too did the work load for the office manager and as a result, many of the basic HR functions were omitted entirely. Based on its assessment, Reach360 crafted a hybrid proposal including both accounting and human resource management. Reach360 developed and implemented the necessary financial metrics and reports to placate the bank and to assist management with better decision-making. In addition, Reach360 re-wrote M-Tec’s handbook and implemented new HR structures that alleviated the workload on the existing team so they could focus on the core business and eliminated blindspots that were mounting as the company grew in size.

The Impact:

With the help of Reach360, M-Tec successfully integrated the acquisition and the start-up of the new division. The bank was happy with the results and continues to be their lender today. Instead of hiring a controller, M-Tec entered into a fixed fee arrangement with Reach360 and saved 25% versus the cost of hiring a controller (savings are even higher when you add in the HR services that are part of the arrangement). Finally, by using Reach360, M-Tec was able to increase sales without increasing administrative costs and when the financial turbulence of 2009 struck, Reach360 was able to scale down as the business went into survival mode.

YMCA

Nonprofit Service Organization

Elkhart, IN

The Situation:

The Director of Finance of the YMCA of Elkhart County was retiring. This was a full-time position that handled all the accounting and reporting functions for the organization. The director provided several months notice prior to his retirement date. The Y’s management and BOD were looking for a cost effective solution to replace the Director.

The Approach:

Reach360 spoke with the Executive Director and the Treasurer of the organization about assuming the accounting and reporting functions. Reach360 was able to spend a month-end with the retiring director to gain insight on the key areas of the month-end close. Manual processes (manually posting daily sales and cash receipts to the GL) were automated using existing import functions. The purchasing cycle was refined to ensure that management approved expenditures prior to purchase. Cash management was enhanced through better communication and reporting to management.

The Impact:

As one finance committee member stated, “Reach360 has improved the month-end reporting process to provide reliable financial information in a timely manner.” They now can trust the information and make informed decisions instead of questioning the information provided. The annual audit is completed in a timelier manner because the accountants can spend time auditing the work instead of doing the accounting and bookkeeping. Time is now spent on the functions that provide the greatest value to the organization.

AlphaGraphics

Printing Services

South Bend, IN

The Situation:

The company's owner lost his bookkeeper and needed an immediate accounting solution where someone could step in and get up to speed in a short amount of time.

The Approach:

Reach360 was hired within days of the employee's departure. Reach360 initially cleaned up the accounting records and implemented internal controls to ensure the owner was aware of all transactions. Reach360 additionally modified procedures for credit card payments to ensure proper documentation was received and in a timely manner.

The Impact:

After several months, the owner has grown to trust and rely on Reach360. He solicits Reach360's input with the business decisions relating to equipment purchases, buy vs. lease decisions, and business acquisitions. The financial statements are reliable and have the integrity needed to utilize them for sound business decisions. The owner is able to focus on running his business and doesn’t have to worry about the accounting functions.

Interra

Credit Union

Elkhart, IN

The Situation:

Interra Credit Union received the resignation of their internal payroll administrator. This was a full time position with benefits. The resignation came as a surprise and there was not an applicant in the applicant pool who had the qualifications needed and who was able to start the job immediately.

The Approach:

Reach360 spoke with the Director of HR about Interra’s openness to outsourcing the functions and informed them that they could start the following week to begin taking over the payroll responsibilities. During the first month the entire office was organized; files were backfilled that needed to go into storage; a process was set up for ongoing support; and the current vendors utilized by Interra were analyzed. Opportunities for cost savings were not only found by streamlining the payroll administrator position, also certain functions were being performed by others in the organization. For instance, accounting was handling the spreadsheets to track vacation time and sick time etc. Reach360 conducted an ROI on the total time/attendance and payroll solution that was in place at the time of engagement compared to the Reach360 recommendations for change. The time and cost savings proved to have significant impact on the credit union. As a result, Reach360 completed the conversion of the recommended products.

The Impact:

Reach360 continues to process payroll and provide a high level payroll reporting services to Interra Credit Union. Interra’s time for manual payroll processing tasks was reduced by over 50% and now more time is spent on reporting assistance and easy data access. In addition, employees are more efficient as they are able to schedule using the recommended time and attendance solution rather than spreadsheets and employees request time off electronically.

General Sheet Metal Works

Manufacturing

South Bend, IN

The Situation:

The company was facing a busy season of nearly double production workload than standard business. Employees were asked to work up to 20 hours of overtime per week. Management wanted to develop a program that would engage all employees to create a team environment and meet customer demand.

The Approach:

The TIP (Team Incentive Program) was customized for the company to focus on late hours, quality, safety, and individual accountability/attendance. Past metrics in each of these areas were researched so that the goals could be set to create an ROI for the organization and support a fair incentive plan for employees. The bonus program was instituted as a seasonal program to incentivize employees during the high volume period, show appreciation and ensure customer satisfaction. 

The Impact:

The first year the program was announced, late hours were reduced to record levels and quality numbers were improved; resulting in increased productivity and less quality issues. In prior years, the organization had three injuries per month. In the first month of the program, no injuries were reported. During the busiest time of the year, the organization was able to produce more, have higher quality, and lower safety issues. Employees were earning incentive dollars in addition to regular pay in reward for a profitable job well done.