In his keynote speech to PEI’s Ope-rating Partners Europe Forum in May, Terra Firma chairman Guy Hands had all sorts of enlightening things to say about how his firm had spent the last 20 years working out better ways to “grind out” operational value creation.
Now First Round can well believe his theory that this is the best way to beat the market over the long term. But when he says this stuff isn’t particularly glamorous, he’s not joking. According to Hands, lots of the firm’s new joiners (the lucky six or seven grads who make it through a terri-fying-sounding application process that last year got 1,500 applications) are swiftly sent packing to somewhere their interpersonal skills can really be put to the test.
The question, he says, is this: “Are these the kind of people we can send out to Australia to work on a cattle farm, where the first thing they’re going to be asked to do is a preg-test on a cow? And once they’ve disgusted you by doing a few preg-tests, they’ll get you to do a few castrations. And a few days after that, they’ll put some little frogs in the toilet, so when you go to the loo at 11 o’clock at night, the little frogs are going to jump up at you…”
Thanks to the wonders of YouTube, First Round now understands exactly what he means by a preg-test (you can use your imagination, but suffice to say it requires a very long glove). Operational excellence must be a doddle after that experience.
Speaking of toilet humour, Hands also talked about how the firm’s €100 million overhaul of the “disgusting” facilities at German service station operator Tank & Rast proved to be responsible for nearly half of the company’s subsequent uplift in pro-fits. Talk about a wise way to spend a penny.