hen preparing for either a public or private exit, opportunities to improve the outcome are often overlooked, including executing a rapid performance improvement assessment.
Here is an outline detailing steps for rapid performance improvement opportunities.
Process:
• Identify – Identify improvement opportunities based on a deep understanding of industry and market positioning, operations, competitor benchmarks and original investment thesis
• Quantify – Quantify impact of opportunities, cost to implement, timeline to implement, and risk of implementation
• Prioritize – Prioritize opportunities based on strategic plans with clear prioritization among time, cost and scope
• Plan – Draft program plan and staffing to execute initiatives
Categories:
• Generally, rapid improvement opportunities are focused on operational process and policy improvements which do not require capital expenditures, and ultimately release cash
• Working capital, organizational design, risk management, and compensation and benefits are common areas for rapid improvement
• Typical working capital opportunities include: accounts payable/receivable process and policy optimization and standardization, inventory minimization, reduced SKU complexity and improved cash forecasting
• Opportunities should be categorized into immediate efforts, and those items to be completed going into the deal
Monitoring:
• Develop a clear expectation of revenue, cost and working capital improvements, then continually monitor timeline tasks-to-actual and budget-to-actual to maximize results
