Virtas Partners identified SG&A cost reduction opportunities for an electronic component manufacturer following a planned sale of a business segment
Client Need
A global electronic component manufacturer faced a significantly reduced revenue base after divesting a business segment representing nearly 30% of total sales. The divestiture created substantial stranded SG&A costs, threatening profitability and limiting the company’s ability to reinvest in growth. SG&A data was fragmented across multiple ERPs, HRIS systems, procurement platforms, and spreadsheets, making it difficult for leadership to understand true labor efficiency, spans and layers, and third‑party vendor spend. Several functions had inconsistent delivery models due to prior acquisitions, and the IT operating model was constrained by a fragmented structure and delayed roadmap execution. Leadership needed a data‑driven view and outside perspective of SG&A performance to identify cost‑reduction opportunities and support a broader transformation agenda.
Tailored Solutions
- Ingested and harmonized disparate date using Virtas Partners powered by RapidCanvas solution using AI & LLM
- Automated Labor Cost, Spans & Layers, and Functional Trend Analysis
- Automated Vendor Spend & Contract Intelligence
- Developed an SG&A Transformation Roadmap
- Sized opportunities totaling 2% to 4% of cost baseline in Information Technology, Finance, Human Resources, Executive Leadership, & Legal
- Identified processes within Finance, Information Technology, Human Resources, & Customer Service requiring redesign & transformation to enable future cost takeout
- Recommended specific actions to execute for near and intermediate term cost savings and process improvement
Value to client
- Delivered a data‑driven, AI‑enabled view of SG&A performance across all major functions.
- Identified actionable cost‑reduction opportunities supported by analytics, benchmarks, and automated insights.
- Provided functional leaders with clear, evidence‑based recommendations that overcame internal resistance to change.
- Enabled the client to reset SG&A levels while supporting future acquisitions and strategic repositioning.
- Created a repeatable analytics framework for ongoing SG&A management and continuous improvement.
Capabilities
- Financial and Data Analysis
- Benchmarking
- Data Visualization
- Cost Optimization/ Performance Improvement
- Finance and IT functional and Operational Experience
- Unique Labor Efficiency Insight Gathering
- Ai and Machine Learning Solutions
- Data harmonization