Drive Value

Chevron 4

Another likely source of competitive advantage in this new [private equity]
landscape is the development of a more hands on approach to management.
(McKinsey & Company)

Given the changing landscape in the private equity space, returns must be created not only through financial engineering but through driving operational value. Approaches that have deliberate action plans and management accountability for the execution of those plans will have a competitive advantage.

Finding a balance between governance/oversight of the company and getting into the day-to-day operations of the company is critical for private equity companies. Tipping the pendulum too much in either direction could limit the ability to maximize the investment opportunity.

With an approach that is strictly governance and oversight, the desired amount of operational value creation may not be achieved. With too much involvement in the management of the company, the exit opportunity may be diminished by ambiguity around the management team’s ability to perform.

The RobinsonEdwards group can work with the private equity company and the leadership team of the portfolio companies to help create a plan that provides detailed strategic focus and the necessary management development and accountability to see those plans through to execution.

Benefits of Driving Value Phase

  • Detailed action and accountability plan to support strategic objectives to drive value
  • Processes that support innovation and accelerate learning and returns
  • Increased management capacity to continuously deliver value for the company

General Approach

Work with portfolio companies to drive the desired value articulated in the strategic agenda

  • Value Creation Road Map – develop a plan to meet or exceed the financial performance expectations of the fund managers
    • Work with management team and board to clearly articulate goals and measures of success for a 3 – 5 year period
    • Assess where the company is today relative to the measures of success and establish targets
    • Research best practices, benchmarks and industry data as necessary
    • Craft a plan that identifies the highest impact initiatives, defines implementation steps and determines accountability measures
    • Coach the CEO and leadership team through the execution of the plan
  • Strategic Innovation – establish a planning process supportive of innovation in an environment where learning is critical to an organization’s success
    • Review and design of processes, policies, structures to support the organization’s goals
    • Work with leadership team to build and/or maintain capacity for continuous learning and innovation
    • High Impact Initiatives – Execution of other consulting projects that will drive the most value out of the company
    • Identify high impact initiatives
    • Create action plan with implementation steps and measurements for success
    • Coach the CEO and leadership team through the execution of the plan
  • Management Capacity – build/continue to build the capacity of the management team to consistently drive value for the company
    • Provide executive coaching and leadership development support for the leadership teams