The question
Pellam makes precision components for agricultural and mining equipment across four plants in Ohio and Ontario, with about $310 million in revenue. When a mid-market fund bought the company in 2024, the new board asked a simple question at its first meeting: why does it take 34 days to approve a $40,000 machine part?
The CEO had been asking the same thing for two years. Plant managers were waiting weeks for sign-offs, buying around the process with small purchase orders, or not asking at all. Two lines had run below capacity for most of a quarter waiting on replacement spindles.
What we found
We traced 120 recent requests from the plant floor to payment. A typical $40,000 purchase needed five sign-offs. Two of those came from people who had never visited the plant that raised the request, and one was a regional finance manager whose role had been created for an acquisition that no longer existed.
The CFO was personally reviewing about 300 requests a quarter, 80% of them under $100,000. Nobody owned the queue, so nobody could say where a given request was sitting. The longest waits weren’t at the approvals themselves. They were the days a request spent in someone’s inbox between approvals.
The one page
In week ten the board got a single page: give plant managers authority up to $250,000 against an agreed annual budget, and bring everything above that to one weekly capex meeting chaired by the CFO. The main risk was spending creep at the plants, so the page also set a monthly spend review with the board for the first year.
What happened
The new authority matrix went live in week eleven. In the first nine months, the average time to approve capex fell from 34 days to 6, and the backlog that had built up over the previous year cleared in seven weeks. Total capital spend at the plants rose 4%, inside the budget the board had set.
We stayed for the first 30 days, ran the first four capex meetings alongside the CFO, and handed the matrix and the meeting format to Pellam’s finance team. "The decision was obvious once it was on one page," the CEO told us. "Getting it onto one page was the hard part."
Results as reported by Pellam’s finance team, measured over the nine months after the new matrix went live.
