A cost base that couldn't survive the next round.
The product worked and the deals were closing. What didn't work was the cost of each deployment, and the business was about to take that into three countries at once. I took the interim COO seat, set up the operations team and cut unit costs by 60%.
What I found
A margin problem that expansion would have multiplied rather than outgrown.
Every deployment cost too much. The revenue was real and growing, but the cost of delivering each installation put the gross margin somewhere no investor was going to fund.
The process had never been designed. It had built up, each step added by someone solving a real problem at the time, and none of it reviewed as a whole.
Three markets were about to open at once. The UK, France and Italy. Exporting an undesigned process into three countries would have created three versions of it inside a year.
What I did
Rebuilt rather than trimmed. You don't get to 60% by negotiating with suppliers.
Set up the operations team. Took the interim COO seat, reporting to the CEO, and built the team that ran operations.
Took the deployment process apart end to end. Every step costed, and each one tested against whether it still needed to exist at the current size of the business.
Rebuilt it as a designed process. A different sequence, with the expensive steps removed, moved earlier where they were cheaper, or absorbed into work already happening.
One operating model for three markets. One way of running a deployment, defined well enough to run in the UK, France and Italy at the same time.
Kept the P&L in view. The goal was a gross margin the business could raise against, which decides which costs are worth attacking and which are load-bearing.
What it changed
Unit costs fell 60%. Through process design rather than procurement, so it held after I left.
A margin the business could raise against. That was the real objective.
Three markets on one operating model. The UK, France and Italy, running the same process rather than three versions of it.
This is where I learned the pattern I now look for first: when revenue is growing and margin isn't, the problem is rarely the thing everyone is looking at. It's in a process that built up rather than being designed. The same instinct is behind the audit I run now.
If revenue is growing and margin isn't, the answer is usually further upstream.
If something in your numbers doesn't add up, I'm happy to take a look.