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Lessons from Private Equity

Lessons from Private Equity

Define the full potential of your company

The target is increased equity value. Getting there requires strategic due diligence and the pursuit of a few core initiatives.

Develop a blueprint for change

This blueprint details how to turn your handful of initiatives into results, choreographing actions from a standing start to the finish line.

Accelerate performance

This step entails molding the organisation to the blueprint, implementing a rigorous programme and monitoring a few key metrics.

Harness the talent

This discipline requires creating the right incentives for managers to think and act like owners and assembling a decisive and efficient board.

Make equity sweat

The challenge is to embrace LBO* economics. This stage calls for managing working capital aggressively, disciplining capital expenditures and working the balance sheet hard.

Foster a results-orientated mind-set

This means making PE* discipline part of a corporation's culture and creating a repeatable formula for achieving results.

Principles to every single investment

"Define the full potential

"Develop the blueprint

"Accelerate performance Harness the talent

"Make equity sweat

"Foster a results-orientated mind-set

No single private equity firm that we know

consistently applies all of these principles

to every single investment."

Source: taken from "Lessons from Private Equity any Company can use"

by Orit Gadiesh & Hugh MacArthur - Bain & Co Inc. (www.HBSPress.org)

* LBO means Leveraged Buy-Out

* PE means Private Equity

'No single private equity firm that we know consistently applies all of these disciplines to every single investment'

This is a quote from " MEMO TO THE CEO - Lessons From Private Equity Any Company Can Use" by Orit Gadiesh and Hugh MacArthur of Bain & Company Inc, and the book can be bought from www.HBSPress.org,

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