About this Presentation
Allied Healthcare Products, a long-standing medical product manufacturer, was facing closure, employee layoffs, and minimal recovery for creditors. However, through effective leadership, critical TOC thinking, investment banking, restructuring attorneys, and liquidity support, the company managed to retain most employees, continue manufacturing important products, and provide substantial payouts to unsecured creditors. Overcoming challenges such as market demand analysis, environmental issues, labor shortages, supply limitations, and medical regulatory hurdles, the professionals successfully executed a turnaround using TOC and a 363 bankruptcy sale. Previously experiencing macroeconomic challenges and operational inefficiencies, the company utilized a TOC demand-pull simulation to identify additional value and cash flow. Collaborating with its advisors, Allied retained 70 employees and secured a $2.5M loan. This new liquidity allowed them to restart operations, negotiate with vendors, and streamline production. Despite retaining only 33 union workers out of 82, Allied achieved significantly higher monthly production per worker post-WARN notice. In May 2023, they secured a stalking horse bidder, Flexicare, for over $8.5M, resulting in over four times the projected liquidation return. The bankruptcy court approved the sale on June 30th, 2023, ensuring job retention, minimum lease payments to the landlord, substantial repayment to trade vendors, and continued availability of key life-saving products in the marketplace. Allied Healthcare's success demonstrates how a detailed demand-pull supply chain simulation can generate significant cash flow, either preventing bankruptcy or facilitating career advancement.
What Will You Learn
To help you get the most value from this session, we’ve highlighted a few key points. These takeaways capture the main ideas and practical insights from the presentation, making it easier for you to review, reflect, and apply what you’ve learned.
Allied Healthcare Products, a company in distress due to declining sales, antiquated systems, and ineffective management, was able to turn around by addressing key issues such as overpurchasing, labor turnover, and backlog management.
The company filed for bankruptcy, which allowed it to restructure and eliminate liabilities, providing a fresh start.
Through effective inventory management and a focus on demand, the company was able to reduce its inventory from $14 million to $6.5 million, freeing up significant capital.
Instructor(s)
Jennifer Eckman
Ms Alka Wadhwa
Alka Wadhwa is an experienced consultant and process improvement expert with over 24 years of expertise in the Theory of Constraints (TOC), Lean Six Sigma, and organizational performance optimization. She has successfully led projects in healthcare, financial services, and manufacturing, driving significant improvements such as a 67% boost in hospital operations and a 140% increase in outpatient visits.
Previously, Alka Wadhwa spent 17+ years at GE Global Research Center, where she led initiatives to enhance various GE businesses through advanced technologies, process redesign, and system optimization. Founder of Better Solutions Consulting, LLC, she specializes in using TOC, Six Sigma, and data analytics to streamline operations and build high-performance teams.
Her work has earned her multiple accolades, including the Empire State Award of Excellence in healthcare.
Dr Gary Wadhwa
Dr. Gary Wadhwa is a Board Certified Oral & Maxillofacial Surgeon with extensive experience in the field. He completed his Oral & Maxillofacial Surgery training at Montefiore Hospital, Albert Einstein College of Medicine in Bronx, NY, and has served as an Attending at prestigious institutions like St. Peters Hospitals, Ellis Hospital, and Beth Israel Hospital in NY. With a career spanning over two decades, he was the former CEO and President of a group specialty practice in NY from 1994 to 2015. Dr. Wadhwa holds an MBA from UT at Knoxville, TN, and has undergone additional training in System Dynamics at MIT, Health System Management at Harvard Business School, and Entrepreneurship and healthcare innovations at Columbia Business School. Committed to expanding access to Oral & Maxillofacial Surgery care, he is currently engaged in a meaningful project to provide healthcare services to underserved populations in inner city and rural areas through non-profit Community Health Centers.