Corporate Value Enhancement

Often there is a defining event in an industry that determines the optimal timing of an exit. When a consolidation wave is occurring, the business owner wants to be positioned close to the leading edge, so that his or her business garners the highest valuation.

At other times, there is no pressing need to sell, and there is time to enhance the value of the business to position it properly. We work with CEOs/owners to do just this.

Our starting is our Value Field Analysis (discussed in the business sale/divestiture) in which we inventory the assets of the business in the context of its industry, and adjacent industries. Having started with that view of what the business could become, we then work with the management team on our Value Enhancement Program involving goals, leverage points, and process

Value Enhancement Framework

• Goals, priorities, and metrics – One of the biggest problems we run into is that small business owners are not focusing on the right goals, establishing key a short list of critical priorities, or objectively measuring progress against their goals. Getting the team focused on the right initiatives, taking pet projects off the list (at least for now) and taking a sober look at progress. Goal realignment can release tremendous energy within the team, and within sales and marketing partners. Prioritization and results measurement are extremely beneficial in the step-by-step realization of a multiyear value enhancement program.

• Economic leverage points – The microeconomics of the business are the ground from which value enhancement can begin. Midmarket companies often pay tight attention to cost levels, but accounting measures are not always the source of deepest insight into fundamental business economics. We model the business so that the key points of leverage can be worked with. Typically, the levers we wind up working on include:
  
  
  • Product line profitability
    • Customer profitability
  • Project “sweet spots”
  • Pricing
    • Inventory turns
  • Go-to-market mechanisms including sales & marketing, distribution, and other channel elements
  • Rep alignment
    • Infrastructure alignment

• Processes excellence – Day-to-day business processes are the lifeblood of the business. Many businesses suffer from processes that are “20% broken.” We find, time and time again, that businesses have no processes for dealing with some recurring situations.
  
  Through our coaching, and the work of our affiliates, we help the business install robust, stable, flexible processes. We provide program management capabilities for organizations to manage complex undertakings.