Operations Governance for a Private Equity Firm

 

OPPORTUNITY

A large global alternative asset manager was preparing to go public within a year.

Due to the firm’s recent and projected growth as well as the desire to support new business ventures, the executives of the firm’s operations groups (finance, accounting, legal and compliance, IT and infrastructure, human resources, and business development) wished to discuss and define a strategy for the delivery of internal services in 2013. 

PROCESS

We reviewed key documents and conducted initial interviews of the participants, which included the firm’s general counsel, chief compliance officer, chief financial officer, head of IT and infrastructure, head of business development, and head of HR. We then developed and facilitated a two-day offsite planning session designed to organize the various department leaders into a cohesive, governing body. We provided the group with a summary written plan, or ‘blueprint,’ along with a plan for ongoing internal communications designed to obtain executive consensus and communicate key elements of the plan to various operations departments.

RESULTS

The participants reviewed and approved the plan, which included the formation of an operations management committee comprised of the offsite participants. The new governing body and internal strategy created transparency across business practices while also enhancing the committee's ability to: 

  • Manage growth, change, and risk;
  • Make better decisions;
  • Support continuous improvement;
  • Allocate limited resources against key risks;
  • Develop and sustain corporate culture;
  • Improve execution and accountability;
  • Provide for the early detection of conflicts of interest; and 
  • Promote efficiency.

The committee coordinates the efforts of all support functions in a collaborative manner using a risk-based approach to respond changing business needs.

The committee supports timely and consistent communication between support functions, drives internal communications, promotes ethical and interdisciplinary problem solving, contributes to the management of the firm’s enterprise risk management, fosters the firm’s corporate culture by actively promoting shared values, and provides transparency and insight to the executive committee through routinized reporting. 

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In two days, senior-level executives who had rarely worked together walked away with a shared purpose and mission. Three years later the operations management group continues to deliver outstanding leadership and coordinated internal service efforts.
— Michael W., Executive Vice President and General Counsel