Function: Operations

WHAT IS A VOICE OF THE CUSTOMER SURVEY?

March 13, 2023 Brad Gerick

Companies conduct voice of customer (VoC) studies to better understand how people interact with their product or service.

While there are many techniques to gather this information, the objective is largely the same: Ensure the customer is being heard and served as best as possible.

READ MORE: What Makes a Commercial Due Diligence Firm ‘Specialized’?

Private equity firms, portfolio companies, and private and public companies can all benefit from a strong voice of customer framework.

“Voice of the customer is extremely important to businesses because it allows companies to have visibility into where they are performing highly and where they are not,” says Brandon John, BluWave’s service provider relationship manager. “By hearing exactly how their customers feel about their brand, they can allocate the appropriate resources to improve some identified areas.”

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Let’s talk about some of the advantages organizations can gain with the information gathered in VoC research.

MSP

Benefits of VoC

There are several advantages to conducting a voice-of-customer survey. It come as no surprise, then, that it’s been top-of-mind for our clients for years.

“VoC projects are always going to be something PE firms prioritize with their portcos,” John says. “We receive steady demand in this space and have since BluWave was founded.”

READ MORE: Voice of Customer Process: Methodologies for Better Service

Deeper Customer Understanding

Rather than merely gathering feedback, VoC research helps companies reimagine their products and services to surpass customers’ needs by gaining an intricate understanding of who they are and what they want.

This includes how and when they use the product, as well as why they’re more (or less) likely to choose it over a competitor.

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Improved Loyalty and Retention

Listening to customers and resolving their concerns establishes trust and loyalty, decreasing attrition and boosting customer lifetime value.

A client is more likely to stick with a brand that it feels has its best interests in mind.

Better Business Decisions

Actionable insights gleaned from customer input can steer key business choices around product roadmaps, marketing campaigns, pricing strategies and service models.

Increased Bottom Line

An unparalleled customer experience not only spurs growth, but also a competitive edge. One study showed that companies with strong VoC programs boast 10X more annual revenue growth.

Enhanced Customer Satisfaction

Catering to customers’ needs and wants forges lasting connections. It not only enhances the existing customer experience, but makes it more likely to acquire new ones as you get a better grasp on your target market.

This can have a compound effect as a happy customer is also more likely to recommend your brand or service to friends, families, colleagues and industry peers.

Employee Retention

This might come as a surprise, but your own employees can also benefit from VoC studies. That’s because it gives them a stronger connection to the customer by putting themselves in their shoes. The more aligned the employees are with the clients, the more satisfied they tend to be, thus limiting turnover.

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Voice of the Customer Best Practices

Use Multiple Channels

To comprehensively capture the opinions of your customers, you should employ multiple avenues for feedback, including surveys, social media, reviews, emails and phone calls.

By using a variety of channels to gather input, companies can gain a multifaceted understanding of client needs and desires that fuels business decisions, improved experiences and financial gains.

Choose Timing Wisely

The timing of requests for customer feedback can significantly impact the quality and amount of responses. Businesses should choose a moment that is relevant, convenient and respectful for clients, such as after a purchase, service interaction or milestone.

Businesses that are considerate in their requests for input are more likely to receive thoughtful, actionable responses that can drive key business decisions and improved outcomes.

READ MORE: What is Commercial Due Diligence?

Act Quickly

The best moment to act on feedback received is as soon as possible. While you want to be diligent about understanding and applying what customers tell you, times is of the essence.

This is especially important when it comes to fixing problems, resolving negative feedback and staying ahead of competitors.

Segmentation

To gain business insights, companies should analyze customer feedback and group clients by factors like demographics or habits. Tailoring actions to different groups helps build loyalty and boost revenue.

It also establishes trust, decreases attrition and increases lifetime value by making each experience as tailored as possible.

READ MORE: 5 Steps to an Effective Voice of Customer (VoC) Strategy

Ask Clear Questions

The quality of your feedback depends largely on the quality of your questions. You should ask clear, concise and specific questions that are easy to understand and answer. You should also avoid leading, biased or ambiguous questions that can skew your results.

The value of customer input hinges greatly on the quality of the questions posed. Aim for clear, crisp and targeted inquiries that are easy to comprehend and respond to. Avoid being suggestive, biased or obscure lines of questioning that can skew results.

Your goal is to learn what customers think about your business, not try to convince them of something.

Acknowledge Feedback

One of the most important VoC best practices is to acknowledge your customers’ feedback and show them that you appreciate their time and opinions. There’s never been more competition for our time, so the fact that someone is willing to participate in your study means they probably have strong feelings.

Follow up with a thank-you message, sharing how their feedback will be used or even offering a reward (see below).

Share Findings Internally

To turn feedback into action, you need to share your findings with the relevant stakeholders in your organization. You should communicate the key insights, recommendations and action plans to your employees, managers and leaders. You should also encourage collaboration and accountability across different teams and departments.

Benchmark Against Your Industry

To measure your performance and progress against your competitors and industry standards, you should benchmark your VoC metrics against external data sources. You can use industry reports, surveys or benchmarks to compare your customer satisfaction, loyalty and advocacy levels with others in your field.

Test and Optimize

VoC best practices are dynamic, not static. You should constantly refine your program to ensure that it is effective, efficient and aligned with your overall business goals.

This can be done with A/B testing, analytics or feedback loops to evaluate and improve your VoC methods, tools and strategies.

Involve Key Stakeholders

To ensure that your VoC program has the support and resources it needs to succeed, you should involve key stakeholders from the start.

Identify decision-makers, influencers and beneficiaries of your program and engage them in defining the goals, scope and outcomes of your efforts.

Offer Participation Incentives

To increase your response rates and motivate your customers to share their feedback , you can offer participation incentives such as discounts, coupons, freebies or loyalty points.

Choose incentives that are relevant, attractive and proportional to the effort required from your customers.

READ MORE: Understanding Voice of Customer: Metrics, KPIs, Analytics

The expert service providers in the BluWave network know the importance of understanding your customers.

We constantly vet and re-vet the best third-party resources for this exact need, no matter what your customer type or industry.

“We have a solid bench of VoC providers in the BluWave network,” says John, who interacts with these third-party resources on a daily basis. “However, it is important to have the right group, for the right need, at the right time.”

Contact our research and operations team and walk us through your VoC needs. In less than one business day, we’ll introduce you to two or three exact-match options.

“Like all service toolboxes in the BluWave network, the VoC toolbox is always rapidly expanding,” John adds.

Once you make a selection, we’ll hold the service provider accountable from start to finish as they bring their voice of customer expertise to your specific situation.

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Business Intelligence Automation: What is it?

March 10, 2023 Brad Gerick

Business intelligence continues to be among the most high-demand services in the Business Builders’ Network.

One aspect of BI&A that’s popular is automation.

The founding partner of one of our BluWave service providers says BI automation is essential to modernizing data analysis.

“A lot of times the process involves people pulling data into spreadsheets manually, analyzing, cleaning, doing stuff with the data and then giving it to their bosses or whoever downstream needs them,” says the partner, Mike Datus*. “That’s usually a very error-prone process because it’s done by humans.”

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BI automation can change all that, and make life much easier for both the analysts as well as those downstream superiors.

Let’s talk in more detail about BI automation tools, their benefits as well as potential drawbacks.

READ MORE: What is Business Intelligence & Analytics?

business analytics

What is Business Intelligence Automation?

Business intelligence automation is the process of consolidating and streamlining your company’s data into a single warehouse that can be accessed in real-time.

Automation provides instantaneous insights that forgo manual input and data manipulation to give team members actionable, consistent information to drive their day-to-day decisions.

Put another way, it helps you automate business processes.

Companies that are older, or perhaps resource-challenged, can benefit greatly from automating their data collection and analysis.

Another data firm’s founding partner, who we’ll call Steve Holms*, puts it this way:

“Holding larger data sets and integrating more data sources to do analysis across several different places makes it a lot easier to analyze.”

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Business Process Automation Benefits

It’s no surprise that business intelligence tools are in such high demand. We have seen countless PE firms and other companies streamline processes and improve real-time decision-making because of them.

Here are just a few of the reasons why you should consider implementing or upgrading your automation efforts.

Save Time

Not only will you complete key tasks sooner, but you’ll be able to make important decisions faster, too.

“You’re talking about orders of seconds instead of hours or days, right? And then that’s huge,” Datus says. “With one of our clients, we built a platform, so instead of waiting a week, the CFO now had a live dashboard in board meetings. So when he was asked a question, he didn’t have to say, ‘I’ll get back to you next week.’ He literally just popped up his dashboard, did a quick filter, and had the answer.”

Our service providers often see situations where top executives need different versions of the same report depending on who they’re working with or what meeting they’re in at a given moment.

This often meant one-off iterations of the same data sets that take might not be available the same day, or even week.

“If the analyst has to go back, they have to go back and pull the data again, do the analysis, run it through, right? That’s another runtime,” says Holms, who noted that those iterations add up.

Another time-saving scenario is if an analyst leaves the company, is on vacation or has an emergency. Data analysis doesn’t stop as soon as that key player becomes unavailable.

“You only have to program it once, and you’re done,” Holms says. “It’s all in the database, and they don’t have to email anybody in case they didn’t get the report.”

READ MORE: Data Warehouse Types: How To Choose the Right One

Scalability

Have you ever tried to access a report so robust that you thought your computer might break down? You’re not alone.

Another benefit of business intelligence automation is the ability to scale.

“Sometimes your data’s so large, it’s hard for Excel to even open, right?” Holms says. “How does sales correlate with product performance, correlate with manufacturing, correlate with this? —putting it in one place makes things a lot easier to expand.”

Save Money

There are multiple ways BI automation can save your company money:

  • You may be able to reduce headcount on your analytics team and reinvest those savings elsewhere
  • The time you do save – as mentioned earlier – is time for which you’re no longer paying
  • The data itself could unveil inefficiencies in your business that are ripe for improvement
  • Manual intervention is expensive. By cutting out intermediaries, and empowering decision-makers more quickly, they can use expertise that no program can account for to make impactful decisions

Consistency

Humans are much more error-prone than machines. Especially well-designed and well-programmed machines.

While you wouldn’t want to automate a process so heavily that it’s no longer monitored, the correct calibration can set your team much more at ease.

“You’re building good processes to make sure it’s consistent. It’s done by computers, so once you do it once it’s pretty robust, unless the data itself changes or the business changes,” Holms says. “Sometimes you just get errors that are difficult to detect. And if you want to go back to see what were my numbers last week or two weeks ago or three months ago, you have to go into your email inbox and search for the report.”

With BI automation, you can leave the inbox behind and find everything you need in your dashboard.

“It’s all in the database,” Holms says, “and they don’t have to email anybody in case they didn’t get the report.”

Dynamic Reports

As we already hinted at above, automated dashboards and visualizations are essentially living, breathing databases.

Instead of plugging new information into a spreadsheet every time you want to update a report, it’s available instantaneously. Not only that. Since it’s connected to the source, you don’t have to input the data at all.

“Once you have it all there getting updated predictably, you can create these really rich charts and graphs, because with these tools you can get these visuals that aren’t static,” Datus says. “The real-time dashboards update as the data comes into the system. So if you want to see one chart or the set of 20 charts for last week just for finance, you can click a few things, and you can get that report.”

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Risks of Automation

While automation can be valuable to a business, it doesn’t come without some potential downside. With the right help, though, we believe all of these can be overcome.

Job Loss

Automation may replace human workers and lead to job losses – at least in the short term.

A benefit of this, though, is that it frees those some people up to learn and use new skills that are equally valuable to the business. Money saved on one area of human capital can be reinvested in your talent.

System Failures

Automated systems can experience technical issues, thereby disrupting business operations. You would hope that this is the exception and not the norm, but even so, manual intervention may be required to fix the issues.

Expert service providers, however, are familiar with the most common vulnerabilities, and will know how to not only fix them, but also proactively prevent them.

READ MORE: What is Technical Debt in Due Diligence?

Lack of Flexibility

Automated systems are designed to handle repetitive, routine tasks in a predetermined manner. They may lack the flexibility to adapt to unexpected situations or changes.

This is quickly changing, though, with the implementation of more and more AI tools that can often course-correct much faster than humans.

This perceived “risk” is quickly becoming a moot point in many senses.

Cost

Implementing and maintaining automated systems can be expensive. This is most likely to be an issue for very small businesses that have less to automate and can handle all their data by traditional means.

Large companies with more robust budgets will probably find that the investment is well worth it in the long run. This includes private equity firms, their portcos, and private and public companies of all shapes and sizes.

While automation involves these and other risks, it’s an increasingly valuable and in-demand facet of business intelligence. Based on the feedback we receive from our clients and expert service providers, we wouldn’t shy away from exploring how your business can benefit from automation.

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BI Automation Tools

Now that you have considered the pros and cons of BI Automation, it’s time to look at the tools at your disposal. While all of these can have a significant impact on your business, you want to make sure you’re using the right ones.

Let’s get familiar with a few of the high-level categories, as well as some specific business automation technologies within them. That way, when our research and operations team connects you to a tailor-made, niche-specific firm to set up your BI automation, you’ll have an idea of what you’re looking for.

Dashboards

BI automation dashboards display key performance indicators, data points and other important metrics in an easy-to-understand format. They provide a 360-degree view of performance using charts, graphs and other visuals.

They offer a quick-glance overview of your organization’s most important metrics, allowing users to quickly identify areas of strong or weak performance, spot emerging trends and gain data-driven insights. Some examples include Power BI, Tableau and Qlik Sense.

READ MORE: Platform Modernization: App, Software Upgrade

Common metrics used to evaluate business performance are cash flow, customer satisfaction and website traffic. Others include sales revenue and customer loyalty.

When you work with an experienced data analytics firm, they’ll be able to match your business needs to the right tools.

Visualizations

BI automation visualizations enable end users to execute automated workflows based on insights within a report. The workflows can be data-contextual, meaning they can change based on filters.

They are often used to connect multiple data sources, create interactive dashboards and charts, provide real-time visualizations and alerts and utilize natural language processing.

Power Automate visual, DataBox, Datapine, Domo and IBM Cognos Analytics are a few of these tools. They can be used to connect to Excel spreadsheets, SQL databases, social media platforms and more.

Predictive Analytics

This type of BI automation tool leverages artificial intelligence and machine learning to automatically generate and apply predictive models based on data insights. Predictive models are employed to forecast what may occur in the future dependent on historical and current data.

These are often used to predict things like customer churn, sales revenue and product demand. They’re especially utilized in the healthcare, finance and marketing industries.

Some of the more popular tools include RapidMiner, Alteryx, SAS Visual Analytics, KNIME, and SAP Analytics Cloud.

Data Mining

Data mining techniques to extract valuable insights from large data sets for making more informed decisions. It’s a branch of data science that searches for patterns, anomalies and correlations in using statistics, artificial intelligence and machine learning.

READ MORE: How To Extract Data from ERP Systems

It’s often used to solve customer segmentation, fraud detection and market basket analysis. Many of the tools listed in the sections above can also be used for these tasks.

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If a lot of this sounds new to you and your team, that’s OK. In fact, Holms says that even a well-composed manual report can be a great launching point for BI automation.

“I would say even if you have an Excel report and it’s a good Excel report, you’re already ahead of the game,” he says.

If you don’t know where to start, set up a scoping call with our research and operations team. We’ll connect you to world-class firms like Datus’s, Holms’, or other PE-grade service providers that can serve your exact needs for your particular industry.

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*Privacy is important to us. While the source and company name have been changed, these are real quotations from a real service provider in the BluWave Business Builders’ Network.

Product Vision Roadmap: What is it?

March 7, 2023 Brad Gerick

A product vision roadmap defines your vision and strategy, creates your product roadmap, gains alignment and buy-in, and tracks progress and re-aligning.

These steps serve as a guide for your team and key stakeholders throughout the product vision process.

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Let’s take a closer look at each phase.

Define Your Product Vision and Strategy

Defining your product vision is the first step in creating a roadmap.

It should explain the purpose of your product, how it aligns with your company’s vision, the problems your product aims to solve and who it is intended for. It will guide all your product development efforts.

Your strategy should outline key objectives and priorities to achieve your vision. It should articulate how your product will be successful in the marketplace as well as differentiate itself from competitors.

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Map Your Product Roadmap

Once you have defined your product vision and strategy, it’s time to map out your product roadmap.

This visual representation involves determining key product milestones and timelines to achieve the product vision and strategy. It also provides a high-level overview of the product’s development, identifying major releases and features.

The roadmap should be detailed enough to guide the product team yet concise enough for leadership and stakeholders to quickly grasp.

It requires balancing short-term and long-term goals to keep the product competitive while focusing on key priorities.

READ MORE: Market Analysis: Growth Strategy for Businesses, PE Firms

Gain Alignment and Buy-In

Communicating your product roadmap to stakeholders and customers is critical to gaining alignment and buy-in. Sharing it and receiving feedback will uncover questions and concerns to address.

The project leader must explain how it supports the overall vision and company strategy. They should then be willing to adapt the roadmap based on feedback to ensure support. This is a critical step for the success of a product, which is why it’s important to take the time to listen to needs and build consensus.

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Track Progress and Re-Align

Once your product vision roadmap is in place, you must monitor key performance indicators to ensure it stays on track. Regularly revisiting your roadmap and vision will enable you to optimize your roadmap and achieve the best outcomes.

Some KPIs to track a product roadmap’s progress include:

  • Customer adoption and retention rates
  • Revenue and profitability
  • Customer satisfaction scores
  • Feature usage metrics
  • Market share
  • Product quality metrics

Tracking these metrics will ensure your roadmap is achieving key business and customer objectives.

Defining your product vision and strategy, mapping your product roadmap, gaining alignment and buy-in and tracking progress and re-aligning are key steps in this process. By following these steps and leveraging the resources available, you can create a clear roadmap.

READ MORE: Org Chart Planning: Aligning with Growth Strategy

The BluWave-grade Business Builders’ Network is full of experts with a proven track record executing product vision roadmaps.

Connect with our research and operations team to set up a scoping call and get matched with two or three best-fit resources in less than 24 hours.

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Data Warehouse Types: How To Choose the Right One

February 24, 2023 Brad Gerick

A data warehouse is an essential tool for businesses that need to manage large amounts of data. With the advent of big data, data warehouses have become even more critical for making the right data-driven decisions.

But with so many different types of out there, it can be tough to figure out which one is the best fit. Having an expert service provider help with the process can save you a lot of time.

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Let’s discuss the different types of data warehouses: enterprise data warehouses, data marts, virtual data warehouses, operational data stores and cloud-based data warehouses.

We’ll also explore the pros and cons of each type and give you some tips on how to choose the right one.

READ MORE: AI Data Analytics: Business Intelligence Tools

Different Types of Data Warehouses

1. Enterprise Data Warehouse

An enterprise data warehouse is a centralized repository that stores all the data for an entire organization. It’s designed to handle large volumes from multiple sources and provides a single source of “truth.”

One of the benefits of an enterprise data warehouse is that it can integrate data from multiple sources and provide a comprehensive view.

This makes it an excellent choice for companies that need to analyze large amounts of information from different sources.

Three examples of companies that might use an enterprise data warehouse are:

  1. A large retailer that needs to analyze sales data from multiple locations and sales channels.
  2. A healthcare provider that needs to consolidate patient data from different locations and systems.
  3. A financial institution that needs to integrate data from different divisions, such as banking and investment services.
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2. Data Mart

A data mart is a subset of an enterprise data warehouse that is designed to serve a specific department or business unit within an organization. Data marts are typically smaller than enterprise data warehouses and are used to address specific needs.

The upside of a data mart is that it can be designed to meet the needs of a particular business unit or department. Organizations that need to analyze data at a more granular level would be well-suited for this option.

Three examples of companies that might use a data mart are:

  1. A sales team that needs to analyze data related to customer orders and purchase history.
  2. A marketing department that needs to analyze data related to customer demographics and purchasing behavior.
  3. An HR department that needs to analyze data related to employee performance and retention.

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3. Virtual Data Warehouse

A virtual data warehouse is a logical view that is created by combining data from multiple sources. The idea is to provide a unified view without physically consolidating the data.

That’s one of the primary benefits of going this route – the ability to keep the data separate physically.

If you need to analyze various disparate sources of information in one place, consider a virtual data warehouse.

Three examples of companies that might use a virtual data warehouse are:

  1. A company that has multiple databases with different types of data and wants to create a unified view without physically consolidating the data.
  2. A business that wants to create a data warehouse without investing in physical hardware.
  3. A company that wants to test a data warehouse concept before investing in a physical data warehouse.
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4. Operational Data Store

An operational data store provides real-time data for operational reporting and analysis. It’s optimized for write-intensive applications, such as transaction processing systems, inventory management systems and order management systems.

If you need a real-time look at your data, this is an apt choice.

An operational data store provides real-time data for operational reporting and analysis. It’s optimized for write-intensive applications, such as transaction processing systems, inventory management systems and order management systems.

Examples of companies that might use an operational data store include:

  1. A retail company that needs to track inventory levels in real time and ensure that orders are processed efficiently.
  2. A financial institution that needs to process transactions quickly and accurately.
  3. A healthcare provider that needs to track patient data and ensure that medical records are up to date.

READ MORE: Business Intelligence Automation: What is it?

5. Cloud-Based Data Warehouse

A cloud-based data warehouse is a type of data warehouse that is hosted in the cloud. This type of data warehouse is designed to be highly scalable and can be used to store and analyze large amounts of data.

They are great choices to accommodate growing businesses.

Three examples of companies that might use a cloud-based data warehouse include:

  1. A startup that needs to store large amounts of data but doesn’t have the resources to build and maintain an on-premise data warehouse.
  2. A global corporation that needs to store and analyze data from multiple locations around the world.
  3. A company that experiences fluctuations in data storage needs and requires a flexible and scalable solution.
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How to Choose the Right Type of Data Warehouse

Choosing the right type of data warehouse depends on a number of factors, including your business needs, the size of your organization and your budget.

A small company might tend to use a cloud-based data warehouse, as it is a more cost-effective option for storing and analyzing data without investing in physical hardware.

A medium-sized company might use a data mart to analyze data at a more granular level, while a large company might use an enterprise data warehouse to analyze large amounts of data from different sources and provide a comprehensive view of all their data.

The cost of a data warehouse can vary greatly depending on the type of data warehouse, the size of the organization and the amount of data that needs to be stored.

An enterprise data warehouse can cost millions of dollars to set up and maintain, while a cloud-based data warehouse can cost a few thousand dollars per month.

A medium-sized company might expect to pay anywhere up to $500,000 per year for a data warehouse solution.

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Pros and Cons: Data Warehouses

When choosing a data warehouse, it’s also essential to consider the pros and cons of each type.

Data Warehouses

Pros

  • Provides a comprehensive view of all data
  • Integrates data from multiple sources
  • Handles large volumes of data

Cons

  • Costly to implement
  • Requires specialized expertise to design and maintain
  • May take longer to implement than other options

Data Marts

Pros

  • Designed to meet specific business unit or department needs
  • Analyzes data at a more granular level
  • Cost-effective

Cons

  • Limited in scope
  • May not integrate well with other data sources
  • May not be able to handle large volumes of data

Virtual Data Warehouses

Pros

  • Provides a unified view without physically consolidating data
  • Can keep data separate physically
  • Can integrate data from multiple sources

Cons

  • May require additional software or hardware
  • May not be as efficient as other options
  • May require additional time to set up and maintain

Operational Data Stores

Pros

  • Provides real-time data for operational reporting and analysis
  • Optimized for write-intensive applications
  • Can handle large volumes of data

Cons

  • May not integrate well with other data sources
  • May require additional hardware to handle large volumes of data
  • May require additional time to set up and maintain

Cloud-Based Data Warehouses

Pros

  • Highly scalable
  • Can accommodate growing data needs
  • Cost-effective

Cons

  • May require additional security measures
  • May require additional time to set up and maintain
  • May not be as efficient as other options

READ MORE: How To Extract Data from ERP Systems

Choosing the right data warehouse is essential to ensuring that your business can make data-driven decisions. If you need help evaluating options for your organization, don’t hesitate to contact us. Our research and operations team can connect you with a PE-grade data warehouse resource to help you make the right decision for your business.

If you’re ready to take your data analysis to the next level, schedule a scoping call with the BluWave research and operations team today. We’ll work with you to understand your business needs and connect you with best-fit resources within one business day.

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Post-Merger Integration: Framework, Keys to Success

February 22, 2023 Brad Gerick

Mergers and acquisitions (M&A) are not simply financial transactions. They involve complex changes in organizational structure, culture, systems and processes.

The post-merger integration (PMI) process is a critical component of any M&A deal. PMI refers to the process of integrating two or more organizations after a merger or acquisition.

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With the right strategies and framework in place, businesses can ensure a smooth transition.

Let’s discuss some of the key aspects of this challenging process.

READ MORE: Merger Planning & Integration: Best Practices for Private Equity Firms

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Preparing for Post-Merger Integration

Preparing for the integration process involves creating a PMI plan and timeline, as well as developing strategies for effective communication and stakeholder engagement. These are essential for ensuring buy-in and support from employees, customers and suppliers.

Here are some things that might be part of that plan and timeline:

  • Identifying key stakeholders
  • Creating a PMI team
  • Conducting due diligence
  • Developing a communication plan
  • Creating a detailed integration plan with clear target dates
  • Assigning responsibilities and roles
  • Establishing a process for issue resolution and decision-making
  • Developing a change management plan
  • Creating a risk management plan
  • Defining success metrics and benchmarks
  • Establishing a timeline for monitoring progress and making adjustments as needed.
PE-Grade M&A Resources

Execution of Post-Merger Integration

The execution of PMI involves several critical steps, including identifying and addressing cultural differences, harmonizing systems and processes, ensuring regulatory compliance and addressing talent management issues. Failure to address these issues can lead to a lack of alignment, lower employee morale and decreased performance.

One of the most significant challenges during the PMI process is identifying and addressing cultural differences. That’s because failure to address cultural differences can lead to significant issues down the road. An experienced interim CHRO can be a great resource for these situations.

Harmonizing systems and processes is another critical step in PMI. This involves aligning IT systems, financial reporting and other key processes. Harmonization ensures that the new organization operates efficiently and effectively, and that there are no redundancies or duplications.

READ MORE: Hire an Interim CFO

It’s also essential to identify and address any regulatory requirements and ensure that the new organization is compliant with all relevant laws.

Finally, addressing talent management issues is critical for ensuring that the new organization has the right people in place to reach its goals. By identifying key talent, developing retention strategies and creating a plan for integrating employees from both organizations, you’re much more likely to have a smooth transition.

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Measuring the Success of Post-Merger Integration

Working together to establish objectives and key results (OKRs) before joining the two organizations is essential. This is how you’ll know whether everything is going to plan and objectives are being reached.

Focus on the metrics that are most important to your business, when they need to be achieved by and how you plan to report them to key stakeholders.

READ MORE: Hire an Interim CHRO: Navigating Challenges, Creating Value

Success metrics may include financial metrics such as revenue growth, profitability and return on investment (ROI). It could also mean employee satisfaction, customer satisfaction and market share.

Whatever key performance indicators (KPIs) you choose, they should be directly tied to your bottom line.

PE-Grade M&A Resources

Post-merger integration is a complex and challenging process, but with the right framework in place, businesses can ensure a smooth transition.

If your business is considering a merger or acquisition, it’s essential to have a comprehensive PMI framework in place. The right one will help your business mitigate risks, harmonize systems and processes and address cultural differences, regulatory compliance and talent management issues.

The PE-grade resources in the BluWave network can help you create that framework and get the maximum value out of your new business relationship. Contact our research and operations team to set up a scoping call and get connected with a best-fit service provider in less than one business day.

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Interim CFO for a Financial Crisis

January 13, 2023 Brad Gerick

When a company faces a financial crisis, an interim chief financial officer can make all the difference in a successful turnaround.

Whether going through a restructuring, facing bankruptcy or other challenging financial situations, an experienced financial leader is essential.

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Situations for an Interim CFO

A financial crisis can be due to something within a company, external economic forces, or both.

Poorly responding to a distressing financial situation can destroy a business. A capable interim CFO, however, will know how to navigate the following scenarios.

Bankruptcy

The two most common bankruptcies a company will file for are chapter 7 and chapter 11.

When a company files for chapter 7 bankruptcy, it plans to shut down.

Chapter 11 bankruptcy, though, means a company is still viable but needs help relieving some of its debt.

While an interim CFO would seldom take on a chapter 7 bankruptcy, it’s common for them to step in and help a company try to avoid chapter 11 bankruptcy. If it’s not avoidable, a temporary chief financial officer can also help navigate the situation.

“A very good interim CFO can be a lot of help because they come in and they look at, ‘What are the things between gross profit and net earnings that are negatively impacting the business?’” BluWave controller Justin Scott says.

Cost-saving measures could include lowering headcount, cutting advertising costs or negotiating with creditors, which we’ll discuss more below.

Restructuring

While most restructuring situations are tied to bankruptcies, there are exceptions. Here are some of the more common ones.

Carveouts

An interim CFO who can adeptly perform carve-out tasks is key for organizations looking to sell off part of their company. That can mean getting their hands dirty setting up general ledger architecture or determining which employees to include in the sale.

“Let’s say 25 percent of the existing team is going with the carve-out, then I’ve got to decide ‘What’s the 25%? How are those processes going to work?’” Scott says. “Where you typically see the carve-out CFO come in is because they don’t want all of those activities to take away from the core business that the existing CFO is already managing.”

CASE STUDY: Interim CFO with Expertise in Commodities, Hedging for Manufacturing PortCo

M&A Integration

An acquisition, of course, is the opposite situation. The finance executive must determine how to integrate multiple teams in the same company.

“You likely have multiple sets of books. You have multiple systems. None of them talk to each other,” Scott says. “Essentially, you’re running parallel systems or parallel processes for everything. And then you have to manually consolidate everything and that’s just no fun.”

Ginessa Ross, who is often the first point of contact for interim CFOs BluWave works with, says lots of clients have been emphasizing M&A skills recently.

“All sides of it, whether it be due diligence, post-merger integration or prep for sale – having M&A experience, especially in private equity, is key,” she says.

Cost Savings

A turnaround CFO may be sought when accounts payable get out of control.

If the internal team has become bloated, they’re likely to partner with someone in human resources to reorganize the company more efficiently.

“It’s not typically just finance here. It’s typically that a new technology has been implemented that’s changed the field and headcount needs to be reduced,” Scott says. “How do we eliminate or mitigate the overhead expense of the SG&A of what’s happening today?”

They may also cut marketing costs or improve operations to find savings. This can be done by spending less on advertising, implementing automation tools or canceling automated subscriptions, for example.

Hostile Takeover

Although unusual, there are times when a temporary finance executive is brought in for a hostile takeover.

“It is possible to go to an interim CFO as a stopgap,” Scott says. “But it’s not a likely scenario.”

More often, the company executing the takeover will already have a CFO in place.

Hire an Experienced Interim CFO for a Crisis

Skills Needed for a Financial Crisis

What skills does an interim CFO need in a time of crisis? Accounting and finance, of course, are fundamental.

“You have to know the full revenue cycle cradle to grave,” Scott says, adding that strong management is also a key trait.

There are other things, though, that are particularly important for a chief financial officer in financially distressed situations.

Internal Communication

When managing a company’s finance team, the interim CFO must be able to communicate their plan of action. Since they’re typically in the role for around six months, they don’t have as much time to win trust and build unity.

Focusing the early days on getting to know the team helps with buy-in for the duration of the project. One component of this is alleviating fears of the unknown.

“The first day, I think, is talking to as many people as possible in the company, on the finance team, and reassuring them that things are going to get better,” says one long-time interim CFO from our network of experts.

A temporary finance executive must also be able to communicate with his or her peers and superiors. Not only do they sit in the C-suite, but they may be a direct line to a private equity firm that has a lot at stake.

“They have to be able to build credibility going both directions quickly if they’re going to get anything done,” Scott says.

READ MORE: What’s the Difference Between an Interim CFO and a Fractional CFO?

External Communication

Beyond providing clarity for coworkers, a chief financial officer must also be skilled at working with clients, creditors, vendors and other outside entities.

If a company is in danger of filing for bankruptcy, the interim CFO will likely negotiate with creditors to lower their debts.

They may also ask clients to move up their timeline for accounts receivable so the organization can have more cash sooner.

In either case, being able to work well with others is paramount.

“The situations where financial executives most often fail to reach an agreement are when they don’t have any people skills, or they don’t truly want a result,” Scott says. “You have to be able to bend and give a little bit on some of these things just like in any negotiation.”

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Crisis Exit Strategy – Prep for Sale

Before taking a company’s financial reins in the midst of a crisis, an interim CFO should understand if the firm is planning an exit, and if so, what the strategy is. That allows the company to get the maximum benefit out of its new executive resource.

“Bringing in somebody from the outside allows you to access a broader set of skills and brings a fresh perspective,” BluWave managing director Houston Slatton says.

Here are some differences between prepping to sell the entire company vs. just a few assets.

Sell the Entity

If someone is brought on to prep for the sale of an entire company, their job is to get it in the best shape possible for the buyer.

Not only will this make it a more attractive purchase, but the seller will extract more value, too. This process should be planned for months, if not years in advance, when possible.

The interim chief finance officer brought on in this situation should have experience improving operations, cutting costs, increasing accountability and more. They should also be well-versed in evaluating and working with potential buyers and closing the transaction.

CASE STUDY: Temporary Finance Leader for a Creative Digital Agency

Sell the Assets

Even when parts of a company are being sold, as opposed to the entire organization, many of the same skills apply.

In this scenario, though, the company remains intact, and employees are not typically part of the package.

The right executive will help an organization receive a large return for those assets, boosting cash flow.

Each interim CFO in the BluWave network has been vetted and reference-checked before we ever put them on our roster.

That way, when companies in financial distress reach out, we can provide two or three exact-fit solutions in less than one business day. Whether your company is in the nation’s capital, Atlanta, our hometown of Music City, or any other major city, we have the resources you need.

This attention to detail and our private-equity speed turnaround give organizations a greater chance of getting back on track financially.

Learn more about the select group of private equity-grade interim CFOs we work with daily.

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Operating Partners’ Forum Recap | December 2022

December 20, 2022 Delaney Walker

Every quarter we gather operating executives in PE to discuss current industry topics and to offer peers the chance to gather, share information, and decompress with one another. In our most recent event, we gathered to discuss top lessons learned in 2022 and 2023 initiatives.

These forums are for operating executives at private equity firms only and follow Chatham House Rules, so listed below are high-level takeaways only. If you are an operating executive in private equity and interested in joining fellow operating executives during our next Operating Partners’ Forum, RSVP here.

Top Lessons Learned in 2022

  • Even the most resilient supply chains struggled in 2022.  We continue to be in a global supply chain crisis.  
  • Pricing strategy and related pricing strategy advisor usage was a major focus in 2022 to try and stay ahead of the inflation curve. 
  • Labor is still a big challenge and will continue to be. Turning to PE-grade recruiters as well as interim execs is a common solution.
  • PE firms and Portcos are doubling down on IT, data & analytics strategies, and implementation processes to be more agile, informed, and automated.  

2023 Initiatives

  • Debt has become less available and more expensive with rising interest rates, which will make it tougher to complete platform deals in 2023. 
  • Digitization efforts will accelerate in 2023. 
  • Having the right org structure in place is top-of-mind for 2023 as labor markets will continue to be tight.   
  • PE-grade, third-party resource usage will accelerate, offering force multiplication for PE Ops teams, bringing them specialized expertise, and enabling portcos to operate more variably.   
  • The PE industry is largely prepared for 2023 and a recessionary environment due to the proactive actions taken in 2022.

We thoroughly enjoyed getting to gather with PE Operating Executives to discuss these current topics. We’d be happy to connect you to the PE-grade, exact-fit, third-party resources you need, just contact us here.

Learn more about how we can specifically help ops execs here.

Pricing strategy expert urgently needed for SaaS portco

Building out a new product GTM strategy, PE firm & portco needs pricing expert

A PE senior associate came to us with a critical need for a pricing strategy expert for their SaaS portfolio company that was developing a new application to sell into the healthcare sector. The firm and portco had been working with a GTM strategist on the commercial plan, but now urgently needed a pricing expert that could help them determine how to price the new product. With the product almost ready to roll out, they needed a pricing expert that could start within the next 2-3 weeks, had industry experience, and could develop as well as justify a pricing strategy for the application.

BluWave has in-network pricing expert with relevant industry knowledge

Leveraging our founder’s 20 years in private equity, we have extensive frameworks for assessing PE-grade pricing strategy needs. BluWave utilizes technology, data, and human ingenuity to pre-map, assess, monitor, and maintain deep pools of pricing experts that uniquely meet the private equity standard. We interviewed the PE firm and portfolio company to understand their specific key criteria, and then connected the client with the select pre-vetted pricing strategist from our invitation-only Intelligent Network that fit their exacting needs.

Firm selects best in class provider to move forward with pricing strategy

Within 24 hours of the initial scoping call, the PE firm was introduced to two PE-grade pricing experts that specialized in SaaS based businesses and were available to help the client immediately. The client selected their ideal choice and was able to confidently develop a pricing strategy and ultimately, roll out their new application to the healthcare market.

In the Know: Proactive Due Diligence Practices

November 19, 2022 Delaney Walker

As part of an ongoing series, we’re sharing real-time trending topics we are hearing from our 500+ PE firm clients. In our most recent installment, Keenan Kolinsky, BluWave Consulting Manager, shares some of the proactive due diligence practices we see PE firms take that separate the more innovative private equity firms from the others. Learn more by watching the video below.

Interested in connecting with PE-grade specialized due diligence providers for your next need? Contact us here to quickly get connected to the ones you need.

Video transcript:

Due diligence is a critical piece in the private equity deal cycle, and we equip hundreds of leading private equity firms with the right PE-grade diligence providers they need – and when they need them. Performing thousands of projects every year, we gain a unique perspective to some of the more proactive and innovative approaches to the diligence process, and I want to share two such approaches we’ve seen that are separating some of the more proactive private equity firms from the others.

Number one, using the right diligence providers for the right deals. Many private equity firms have a go-to list of commercial, IT, and operations diligence providers they leverage for nearly every deal. However, each deal’s different and may require a different slate of providers to get the most out of each unique diligence phase, or diligence stream, depending on a variety of factors such as the target’s industry, the deal size, target technology or operational nuances, timing, and more. Many of our proactive private equity clients realize these nuances, and we support them by connecting them with the diligence providers whose functional capabilities, expertise, and experience account for these factors – uniquely positioning them to deliver excellence on that deal. This allows private equity firms to gain better insights with more speed and certainty, which, in turn, optimizes the entire diligence process for the respective deal. In private equity, one size does not fit all.

Number two, expanding the functional breadth and depth of diligence. Times are changing, and it’s more important than ever to get diligence right and to gain the necessary actionable insights, not only to make a more informed investment decision, but also to begin equipping the value creation plan. Especially in today’s market, value creation doesn’t and can’t end with only commercial, technology, and operational levers.As such, many of our proactive private equity clients are institutionalizing increasingly common diligence streams such as HR, digital, data, and ESG diligence to inform both investment decisions and value creation plans. We continuously map the market for PE-grade diligence providers across various functional areas, industries, price points and more so that you don’t have to.

If you or your teams are using the same slate of diligence providers for every deal, it may be time for a refresh. As you start to consider your slate of diligence providers for your next deal, give us a shout at info@bluwave.net and let us connect you with the right diligence providers for the right deal.

In the Know: How to Action BI & Analytics Experts

November 10, 2022 Delaney Walker

As part of an ongoing series, we’re sharing real-time trending topics we are hearing from our 500+ PE firm clients. In our most recent installment, Jeremy Yoder, a BluWave Strategic Account Executive, shares how to action BI & Analytics experts, detailing the different use cases firms and other proactive companies have for bringing in data & analytics experts. Learn more by watching the video below.

Get connected to a BI & Analytics Expert.

Video transcript:

In our increasingly digital world, business intelligence and analytics is a growing input factor for companies to measure their level of growth and for private equity firms to evaluate the success of their portcos. PE firms come to BluWave with needs for data and analytics specialists who can help drive effectiveness and efficiency within their portfolio companies. Here are just a few of the most common use cases we see for why a firm brings in data and analytics specialists.

Number one, developing more measurable metrics at the portco level. The first step to making data-driven decisions is having the right metrics and reporting measures in place. Many companies are lacking this when their first PE sponsor comes into the picture, so our clients equip their new portcos with specialists who can help companies build a solid metrics and reporting foundation. This gives the PE firm visibility into how their portcos are tracking against those set goals.

Number two, data diligence. For companies with large sets of data on products and customers like companies in the B2C sector, there is often hidden value hiding within these datasets if they aren’t being analyzed. When companies aren’t actioning the data available to them, leading PE firms bring in specialists to uncover what stones are being left unturned and help glean risks and actionable opportunities from the data that already exists.

Number three, cleaning and assessing data. The most forward-thinking PE firms are using specialists to clean and assess their portcos data so that they can improve the precision of their evaluations and more deeply inform the health of their organizations. We have a deep bench of business intelligence and analytics providers at the ready for a variety of niche needs. To get connected to the PE-grade,exact-fit provider you need, contact us at info@bluwave.net.