Applying RapidKnowHow Breakthrough System Architecture (BSA)
A) CASE SETUP (Realistic Mid-Size Industrial Gas Player – Europe)
Revenue: €500m
EBITDA Margin: 22%
FCF: €55m
ROCE: 11%
Multiple: 12x
Market Value: €660m
Problem Signals:
• DSO increasing
• Energy cost volatility
• Inventory build-up
• Margin leakage in merchant segment
• Capex pressure
B) BSA STEP 1 – DEFINE 90-DAY OUTCOME
Target:
+€10m sustainable FCF improvement
ROCE from 11% → 13%
Signal reduction in capital pressure
Action:
“We release trapped cash and protect margin before chasing growth.”
C) BSA STEP 2 – IDENTIFY HIGH-VELOCITY LEVERS
We choose 4 levers (impact × speed × control):
1️⃣ Working Capital Release (DSO + Inventory)
Current:
DSO = 62 days
Inventory Days = 48 days
Target:
DSO –5 days
Inventory –8 days
Impact:
€500m revenue / 365 ≈ €1.37m per day
DSO –5 days → €6.8m cash release
Inventory –8 days → ≈ €11m release
Conservative realization (50% effective in 90 days):
≈ €9m net cash improvement
2️⃣ Energy Pass-Through Timing
Lag in contract indexation: 2 months
Energy volatility compressing margins
Action:
Align pass-through monthly
Renegotiate 30% top contracts
Impact:
1% EBITDA margin recovery on €500m
= €5m EBITDA
≈ €4m FCF uplift
3️⃣ Pricing Leakage (Merchant Segment)
0.6% hidden discount leakage
Fixing 50%:
0.3% × €500m
= €1.5m incremental EBITDA
≈ €1.2m FCF uplift
4️⃣ AI Invoice Audit
Historic overpayments + billing errors
Recovery potential estimated:
€1–2m one-time cash
D) TOTAL 90-DAY IMPACT
Working Capital Release: €9m
Energy Adjustment: €4m
Pricing Fix: €1.2m
Invoice Recovery: €1.5m
Total FCF Impact ≈ €15.7m
Conservatively sustainable: €10–12m
E) VALUATION EFFECT
Original FCF: €55m
New FCF: €65m
Multiple 12x:
Old Market Value = €660m
New Market Value = €780m
Δ Market Value = +€120m
Action:
“€10m sustainable cash × 12 multiple = €120m valuation effect.”
This is leverage.
F) ROCE IMPACT
Capital employed remains stable (no major capex).
EBIT improves +€6–8m
Working capital reduces
ROCE shifts:
11% → approx. 13–14%
Capital efficiency improves.
Risk perception decreases.
Multiple stability increases.
G) EXECUTION LOOP
Week 1–2:
Signal deep dive
Top-20 customers review
Energy contract mapping
Week 3–6:
DSO acceleration team
Inventory reduction sprint
Pricing guardrails enforced
Week 7–12:
Energy renegotiations closed
Automation activated
Weekly cash capture dashboard
Reinforcement:
Monthly contract clause standardization
Weekly cash cadence institutionalized
H) STRATEGIC INSIGHT
This is not cost cutting.
It is capital release + margin protection + structural discipline.
And it is executed without:
• Major restructuring
• New growth investments
• Layoffs
• Strategic risk
It is internal leverage.
I) WHY THIS MATTERS
This case proves:
Your AI-Orchestrator Leadership + BSA
is not theoretical.
It directly impacts:
FCF
ROCE
Market Value
Strategic Autonomy
This is board-level language.
And in Industrial Gas — capital discipline is king. – Josef David
