BSG From the Boardroom

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    PEI Operating Partners Forum: October 19 & 20 – New York City


    This article was previously published on LinkedIn.

    Key Takeaways

    Here are some of the highlights that resonated with me...

    I. Current Trends in PE Impacting the Operating Partner Role

    • Pressure to create value from LPs is pushing GPs to cut HQ costs and push them out to portfolio companies, compressing growth trajectory for many OPs
    • More emphasis on industry specialists and ex CEOs with specific industry backgrounds
    • Role is evolving, smaller operating staffs and more integration with deal teams

    II. Talent - Improving Hiring Outcomes

    • More emphasis on outside independent assessment protocols such as Hogan and Scorecards
    • Have a clear idea of who you are trying to hire
    • Use assessments and scorecards during diligence
    • Insist on a consistent approach to interviews
    • Consider how culture will impact performance
    • Ask if the position spec is realistic
    • Invoke onboarding and follow up with new executive hires

    III.   Turnarounds - a How-to-Guide

    • 68% of attendees polled cited incompetent managers as the single biggest cause of business failure
    • Belief is that good leaders build companies that can withstand competition and cost pressures

    Best practices include:

    • Flatten the organization
    • Find the “go-forward” team
    • CEO needs to communicate with all employees
    • Reorient employees to what the real business is
    • Focus on the sales team 

    IV.  Growing Revenue in Portfolio Companies

    • Conference attendees believe more focus is needed in driving revenue growth in their portfolio companies.

    How to motivate portco CEOs to improve in this area?

    • Bring in outside advisors; let them choose between two firms
    • Share opportunities discovered during diligence
    • Ensure that the CEO is aligned with value creation model of PE
    • Develop a systematic approach to tracking and measuring sales growth
    • Be agile, reallocate people, money and time every 90 days

    I’d be interested in your comments ….

    I'm Replacing A Key Executive

    -by Alison Estabrooks on Oct 30, 2016 10:00:01 PM


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