Operational Excellence: Changing values

Welcome to our fourth annual Operational Excellence Awards Special, and while we’re at it, our heartiest congratulations to all 12 winners revealed within it. This is the publication where we collect and celebrate the very best stories of private equity value creation from across the globe.

It reveals how GPs added transformational value to the companies they bought, and then, in the very best cases, future-proofed them before they were sent off, better equipped to deal with the vagaries of a rapidly changing world.

Theme sound familiar? Well it should. At the risk of being repetitive, operational excellence should lie at the heart of the private equity proposition. The days of buying a firm, leveraging it to the hilt and then selling it on at a huge multiple for relatively little effort are (hopefully) long gone. The global financial crisis should have put paid to that particular business model.

We hope you will forgive us for stressing the point once again, but in an ever more competitive business environment, there really is no time like the present to showcase the skills that make your firm really stand out from the crowd.

For all our awards entrants, not just the winners, we say thank you. We appreciate that filling out often intricately-detailed timelines and collating a disparate set of metrics takes time. We certainly appreciated that fact when we sifted through every single one of them.

We received a very healthy selection of awards entries from GPs in the Americas, EMEA and Asia-Pacific regions, and what was particularly encouraging was that our battle-hardened panel of 11 expert judges told us they had found it genuinely tough to select the winning entries in each of the categories. That is testament to those GPs out there that demonstrated to us that they achieved true operational excellence for their portfolio companies.

Of course, there are a number of operating partner models out there that GPs can deploy, but as our feature on p. 8 points out, whichever one is chosen, transparency and open, honest dialogue between the GP, its investors and the portfolio company management team is paramount to its success.

And if your operating partner model involves working as a minority partner, our feature examines the intricacies of trying to drive the value-creation process, even when you are not the one behind the company wheel.

We have examples of a number of just such successful partnerships within this special supplement, and while there is nothing wrong with trumpeting their success, as hopefully we do within these pages, no GP can ever afford to rest on its laurels.

Against a fast-changing backdrop of disruptive technology and with ever greater competition for LP assets, continuing to be able to diversify and differentiate your offer should be front and centre for every GP.

Our awards supplement reveals a number of GPs that are doing just this, because standing still is simply not an option in today’s world.


Enjoy the supplement,

Matthew Goodburn