Transform & Thrive - Insights

Unlocking Value with Manufacturing Operational Due Diligence in Private Equity M&A

Private equity (PE) firms are increasingly turning to manufacturing operational due diligence (ODD) to unlock hidden value and mitigate risk. By conducting a deep dive into a target company’s manufacturing processes, supply chain and workforce, ODD enables PE firms to:

• Identify value drivers: Uncover opportunities for cost reduction, efficiency improvement and revenue growth.
• Assess operational risk: Evaluate supply chain vulnerabilities, quality control issues and workforce challenges.
• Optimise post-acquisition integration: Develop effective integration plans to accelerate value creation.

By leveraging ODD, PE firms can make more informed investment decisions, enhance post-acquisition performance and achieve superior returns.

Read the full article here to explore how manufacturing ODD can transform PE deals.

Positioning Commercial Organisations for Success?

L.E.K. recently helped a leading instruments supplier to the Life Sciences sector identify opportunities to drive their revenue performance. Like many others supplying to the Life Sciences sector, they faced a decline in demand as the COVID market boom gave way to a post-pandemic correction.

In these challenging market conditions, it is crucial for commercial organisations to operate efficiently, with agility, and adopt a proactive sales approach.

L.E.K. was engaged to identify concrete, actionable steps to help the supplier navigate these difficult circumstances.??

Diagnosing current commercial performance?

The first step in identifying improvement opportunities is to conduct a thorough diagnostic assessment of commercial performance – as this allows you to pinpoint the current challenges that need to be addressed.

To assess areas for improvement, we used L.E.K.’s Commercial Excellence framework (see Figure 1), leveraging a combination of inputs:?

• In-depth discussions: Speaking to various commercial management and sales reps across the organisation to understand current approaches and challenges already identified
• ‘Time spent’ survey: Conducting a group-wide survey of the commercial employees to understand which activities they invest their time in, as well as the pain points associated with their time allocation?
• Historical sales performance: Thorough analysis of recent financial outcomes and lead management performance?
• Customer feedback: Interviews with customers to understand their needs and current perception?
• External benchmarks: L.E.K. experience supplemented with targeted competitor discussions?

This approach can bring valuable insights, including:?

• Comparison of approaches across each element of L.E.K.’s Commercial Excellence framework against market best practices?
• Analysis of revenue performance in relation to L.E.K.’s understanding of market trends?
• Identification of trends over time in KPIs measured across the sales funnel?
• Recognition of current challenges within the sales organisation??
• Detection of misalignment between the client’s perceived value proposition and their customers’ view of it?
• Identification of areas where time spent does not translate into financial outcomes?

Identifying improvement initiatives?

Armed with a comprehensive understanding of current commercial performance, L.E.K. facilitated a brainstorming session with senior management to explore potential improvement measures. Emphasising an open-minded approach, we agreed that no ideas would be off-limits – there would be no "bad ideas." This unrestricted exchange of thoughts fostered the identification of innovative, effective and actionable initiatives.?

Approximately 40 actionable initiatives were identified that would help deliver across six objectives:?

1. Accelerate the conversion of current leads in the funnel through a short-term sales push.
2. Drive new leads and sales opportunities through structured customer outreach.?
3. Increase the number of inbound leads from new and existing customers through improved marketing and sales activities.
4. Enable sales representatives to increase their focus on pre-sales activities for the highest-value opportunities.
5. Introduce a more flexible product offering/bundling to be more attractive to customers.
6. Improve internal sales enablers (tools, systems, processes) to better support sales representatives.?

With these initiatives identified, L.E.K. could work with the management team to develop actionable plans including clear activities, milestones and cost impact. This allowed our client to take meaningful steps towards driving improved revenue performance.?

In case of any questions, please reach out to Claudio Molinaro (Paris), Tom Marshall (London) or Marc Seipp (Munich).?

Creating Sustainable Value from Performance and Operational Transformation

In a recent interview with CF News, Jean-Philippe Grosmaitre and Claudio Molinaro , Organisation & Performance (O&P) Partners at L.E.K. Consulting, discussed the firm's commitment to helping clients achieve sustainable value creation, combining dedicated teams with strategic and operational excellence insights.?

Jean-Philippe and Claudio highlighted key focus areas that make L.E.K. Consulting unique, including:?

• Strategic sector expertise: In-depth understanding of client’s core-markets and competitive positioning
• Commercial excellence: Seamless approach to go-to-market combining sector know-how and salesforce effectiveness approach
• Operational improvement: Identifying cost-saving opportunities and streamlining processes to boost efficiency, including building robust systems to drive accountability
• Organisational transformation: Redefining structures and roles to align strategic goals and to improve performance, while minimising disruption and leading impactful change

By working closely with clients and providing practical, actionable recommendations, L.E.K. empowers organisations to achieve sustainable, long-term success.?

Read this interview with CFNews to learn more about L.E.K. and how we can support your organisation.?

L.E.K. Thought Leaders

Connecting with us

Claudio Molinaro, Partner; Jean-Philippe Grosmaitre, Partner; Sebastien Beausoleil, Principal; Tom Marshall, Principal