September provides a timely window for private equity firms to initiate a strategic renewal process in their portfolio companies, setting the stage for a robust 2025. Good strategy provides both profit and growth, and ultimately, the opportunity for your companies to succeed at what they do best.
At its core, strategic renewal is a recalibration of a company’s direction and is a critical annual/semi-annual activity. It is an orderly investigation into your company’s alignment with emerging market demands, helping them make timely and sometimes pivotal adjustments to organizational resources, competitive strategies, and operational units.
Hope is not a strategy.
Companies must respond effectively to changing market environments and internal growth dynamics. The ProAction Group can help you take those first steps in taking a proactive approach to strategic renewal. Our process is an accelerated deep-dive into the actual performance of each company, focusing on both customer and product analysis:
Optimizing Inventory: Analyzing current inventory levels and recasting to prevent over/under-stocking. And using any dramatic results to trigger additional action (think – canary in the coal mine).
Addressing Pricing Leaks: Ensuring that pricing strategies are tight, and appropriate. Quantify where we are charging less than our customers are willing to pay.
Subsidy Identification: Pinpointing areas where the company may be inadvertently subsidizing customers, leading to expensive distractions and even revenue loss.
Operational Improvements: Identifying parts of the business that should be simplified or managed differently, as well as waste that can be addressed.
Start with your customer analysis – are they strategic, significant, and profitable? Then move to your products/services and use the same qualifiers – are they strategic, significant, and profitable? The outcome is a data-driven approach that not only sets benchmarks for improvement but also ensures alignment between the company’s strategy, operational realities, and market opportunities.
Why Start in September?
Beginning the strategic renewal process in September allows firms to integrate insights and changes into the upcoming year’s budget and strategic forecasts. This timing ensures that adjustments are not only reflective of the current state of the market and internal operations but are also forward-looking, setting a solid foundation for the next year’s growth and profitability.
Strategic renewal is not just about change—it’s about transformation and alignment that resonates through every layer of the organization, unlocking new potential and sustaining or growing your competitive advantage. As we step into September, let us support your portfolio companies towards a revitalized, strategically sound future.
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