Team and organisational strategy

Why is this important?

In our view, there are two fundamental questions investors should be asking themselves when looking at a team pre-transaction:

• Can this team, supported by these organisational arrangements, deliver the stated strategy within the time and resource constraints?

• What levers do we have to improve the chances of success?

These are important because (a) the biggest cause of post-deal failure relates to an inability to execute and (b) almost all mid-market companies need a dedicated strategic initiative to ensure that their management and organisational arrangements adequately underpin scaling.

Why can it be difficult?

Traditionally, management due diligence focused almost totally on a few senior managers. However, that rarely provides a full and well calibrated answer to the two questions. Consequently, post-deal planning can largely ignore management and organisation issues (apart from adding headcount) until issues arise and performance suffers.

How do investors and boards achieve success in this area?

The most important thing is creating an atmosphere where managers feel comfortable talking about internal barriers to growth and the various kinds of development requirements those imply. That implies skill in building trust through the transaction process – but also an ability to probe areas which can be naturally uncomfortable.

The other low-cost, high-value tactic is to arrange a roundtable of the main DD providers and then ask joined-up questions to understand a business in three dimensions and digest the implications and then plan accordingly.

How can Catalysis improve outcomes?

The limitations of traditional methods mean that we take a wider spectrum approach to understanding the ability of teams and organisations to execute. Consequently, we use a wide-ranging toolkit and grown-up conversations to explore individual, team, organisation and strategy issues – and the connections between them. We feed back conclusions through a report, calls and roundtables.

Then we use conversations with management, investors, other DD providers and the Chair (if already appointed) to convert our insights into a roadmap, as part of the overall post-deal value creation plan (or however you describe it).

To help get the improvement process moving, we may also directly support management teams, whether that involves individual development plans, workshop facilitation or helping create management processes.

Our track record

We have supported more than two hundred transaction processes and can guide investors and teams on how to extract most value for the least stress from them. See here for more details.