Post-deal transformation: how to build a team that works
We explain the importance for private equity firms of deploying a cohesive team of independent consultants for post-deal transformations
Private equity firms have a clear objective when acquiring a new company. For the pre-deal buying process, they build a value-creation strategy to take the company from the current state to a future, remodelled state. Formed from initial due-diligence and research, this plan sets out the long-term ambitions for the business and establishes the scope for the proposed timescale of private equity backing. As these hold periods are elongating, the transformation opportunity is growing with more focus on implementing deep rooted lasting solutions.
Post-deal is where the initial draft of a strategy is converted to a detailed roadmap, clearly setting out delivery goals for business transformation. The plan encompasses every transformation need, from leadership and functional restructuring to organisation-wide digital change, with determined timelines built in to ensure long-term delivery of the primary objective: high reward exit.
In order to deliver this, a team of change agents has to be deployed. There are many options available for building a team, but the main point of consideration is that it has to comprise of people of the highest calibre that can realise the plan quickly, efficiently and with expertise. They have to be the ‘best of the breed’ with an in-depth understanding of the sector; knowing industry best-practice, such as optimal organisational structure and the most favourable IT solutions. Unlike other consulting offerings, independent consultancy offers impartial services; there is no vested interested in the solution and no corporate protocol to follow for delivering the transformation.
The mobilisation of a team is critical to secure a sound team dynamic. For this there has to be an initial selection process in which there is due diligence activity with an assessment framework to determine fit to the project at hand, to the team and to the client. Within this, there can be a division of labour to outline the project organisation and to determine who is who in the structure of the team. This is particularly critical for reporting responsibility and work fluidity between the segmented working areas.
Odgers Connect provides over-arching supervision for higher-level governance of the team that supports the consulting activity and gives transparency of project management to the client. When deploying a full team for extensive transformations, having such an intermediary to coordinate the individuals and guarantee delivery success gives more weight to the contracting of independent consultants. As the mobiliser of a network of highly skilled independent consultants, our organisation conducts an assessment process that ensures the consultant’s expertise and approach fits with that of the organisation. With this personal relationship and understanding of their expertise, Odgers Connect is able to select the right talent for the organisation’s needs.
An independent consulting team also gives greater authority to the client with the flexibility made available. As the transformation programme proceeds post-deal, private equity firms can build the team of consultants up or down to fit the needs of the organisation. Given that hold periods are elongating, even up to 15 years, it is critical that the firm has this agility to adapt to potentially vastly different market conditions made during the long-term investment from initial purchase to exit.
In the post-deal stage, private equity firms need to be implementing a long-term transformation strategy with a team of experts that can deliver the critical objectives set out in the pre-deal acquisition proposal. Bringing together a tight group of independent consultants can not only deliver the groundwork of the value creation strategy, but such a team will embed the transformation deep into the organisation for long-term change stability. For private equity firms, this is critical for a smooth exit.