Private Equity Value Creation – Focus on What’s in Your Control

3 Levers PortCos Can Pull to Drive Value Creation and Control Their Own Destinies

These days, if a portfolio company is not delivering on its value creation promises, fingers are instantly pointed at the economy. True, portfolio company operations leaders and private equity partners cannot change the broader macroeconomic situation. But they can and must still hit their value creation targets despite inflation, the labor pinch, and ongoing supply chain shortages. The key to success is a shift in mindset that turns attention and focus to the performance issues that remain very squarely in the management team’s hands.

This article from Ranjith Rajendran, Managing Director of TBM’s Private Equity Practice, outlines three steps portfolio company teams can take to accelerate value creation even in these challenging times:

1. Fill order backlogs by diagnosing bottlenecks, prioritizing the right improvement projects, and engaging every member of the team in the effort. 
2. Put a scoreboard and management system in place to track progress on an hourly and daily basis and enable real-time course correcting.  
3. Establish a coaching and mentoring program for ensuring and sustaining the right every-day behaviors for success.

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