Archive for the ‘Methodology’ Category

What Stands Between Private-Equity Firms and Their Companies, Part 5: PI (Project Inflation)

Wednesday, July 23rd, 2014

This is the fifth and final part or our short series about increasing the potential in the relationship between private-equity firms and their portfolio companies. The other articles are available by clicking on the “Private Equity” category here. Today’s topic is one of my long-time favorites: leaving/cutting things out.

How many “master plans” have peen drawn up? Sometimes they go by other names, such as “growth agenda,” “future map,” or “Roadmap 20XX,” or . . . You can probably think of others. How many management teams have agonized over this exercise? How many projects have been developed from these “master plans?” Countless numbers.

How many projects have actually been implemented? And in the final analysis, how many of them succeeded? Significantly fewer. But that stops almost no one from assessing a company’s health by the number of its growth projects. However, huge frustration can arise if priorities are constantly shifting in the face of an immense and confusing project-landscape, or when no one really knows, any more, what the priority of any particular topic is at the moment—which has the advantage that no matter what, you are somehow working on something important.

In my presentations, I have abbreviated this state of affairs “PI,” or project inflation. According to our observations, companies don’t have too few projects. They have too many. Not everyone who has MS Project on his computer is a project manager. Not everything that’s called a project, is a project. When used to justify a position, the idea that “I have a project, therefore I exist” is the enemy of growth. If PI suddenly develops in the relationship between a private-equity firm and a portfolio company, it has the additional disadvantage that the ambitious and generally established goals of investors are postponed far into the future. And then, quarterly board meetings become agony.

Cut 50 percent of your internal projects. Then add 10 percent market-oriented projects. In doing so, you will put yourself on a significantly better path than the one you are on today. We have developed a methodology that does exactly this, with a clearer evaluation of individual projects. The impact is striking.

© 2014, Prof. Dr. Guido Quelle, Mandat Consulting Group, Dortmund, London, New York. All rights reserved.

“I’ve Got a Camera”

Wednesday, July 16th, 2014

Recently in our narrow streets: A package delivery-service driver can’t make the uphill curve in one shot with his van, so he has to back down the hill. Meanwhile, a bicyclist emerges behind the vehicle, the two coming dangerously close to one another. Only a couple of inches separate them. The driver drives forward again, and then back, annoying the cyclist. On my way downhill in my car, I honk to signal the driver of the van that something isn’t right. Coming to a stop opposite one another, we both lower our windows. The following dialog transpired:

  • Me: “There was a bicyclist dangerously close to the back of your van.”
  • He: “I know. I’ve got a camera.”
  • Me: “Still, that was dangerously tight.”
  • He: “I’ve got a caaa-mmerr-raa back there!”
  • Me: “Didn’t help much.” It was pointless; I drove off. In the end, things turned out OK.

Despite the back-up camera, the driver barely escaped a collision with the cyclist—or the other way around. Having the tool was not enough. But how often do we use tools that others aren’t familiar with? How often do we use the wrong tools—or the right ones incorrectly?

Lessons for everyday life:

  • Don’t rely on your tools alone.
  • Don’t assume that others know that you know what you’re doing.
  • Use the right tool. A back-up beeper would have been of significantly more use to the cyclist. Namely, he would have know when he should or shouldn’t be behind the vehicle.

© 2014, Prof. Dr. Guido Quelle, Mandat Consulting Group, Dortmund, London, New York. All rights reserved.

Personal Growth: Speak Extemporaneously Instead of Following a Script

Friday, May 9th, 2014

As most of those who work with us know, I speak frequently each year about business- and personal growth, and generally speaking, the feedback I get tells me that the presentations are effective.  An essential aspect of their impact is that I do without PowerPoint® or other technical aids. Interaction with participants from the stage, a flip chart—perhaps projected from the camera for the audience if there are several hundred people in the room—and a good topic suffice.

Last year in Switzerland, I worked intensively, one-on-one with Matthias Pöhm, arguably Europe’s foremost public-speaking coach. The objective was to further my development in matters rhetorical and not to stagnate. Pöhm calls PowerPoint® presentations “assisted reading.” A superb concept.

Not long ago, we stopped by our Lions Club in Dortmund’s Jewish community to learns something about working and living there. For almost 90 minutes the speaker, Mr. Katz, spoke to us inside the synagogue, explaining things and answering questions. PowerPoint®? No. It wouldn’t have fit in. At our recently-completed strategy session, each member of the Mandat team spoke individually about past successes and the associated templates for success, partly in English, as a matter of fact. PowerPoint®? That era has passed. If someone really understands something about a topic, he or she needs no transparencies that offer reading assistance to the speaker or the audience.

Freedom for speakers and the audience; out with assisted reading!

© 2014, Prof. Dr. Guido Quelle, Mandat Consulting Group, Dortmund, London, New York. All rights reserved.

Mandat Growth Tip of the Day: STRATEGY x TEAM = GROWTH

Tuesday, May 6th, 2014

We have just returned from our annual strategy conference which, as in years past, ran from Wednesday evening to Saturday morning. This year’s conference was arguably the best one yet. We conduct our conferences as we do with our clients including, of course, bringing in an outside moderator, a practice we strongly recommend to our clients. Five critical questions characterize our strategy conferences, :

  • During the past year, what have we achieved together?
  • What were the essential patterns of success along the way?
  • What does the “cool year” of 2014 look like?
  • Which path do we take to get us there?
  • How do we make headway during the year?

Not only does the strategy conference bring to light an excellent, precise road map, but also every team member has assumed responsibility for it – just as in 2013. That is also the essential point that I would like to make as today begins: An otherwise good strategy is not worth the paper it’s written on if the team is not on board. In this respect, the formula for success is: STRAGEGY x TEAM = GROWTH. If one of the factors is zero, the result is also zero. Work only with people with whom you are happy to work, and see to it that a mutually-supportive team developes.

When will you hold your strategy conference? And when it’s over, how are you to be certain that the results don’t sink into a sea of day-to-day operations, but are actually implemented?

© 2014, Prof. Dr. Guido Quelle, Mandat Consulting Group, Dortmund, London, New York. All rights reserved.

Communication in Key Projects

Thursday, December 12th, 2013

It should be common knowledge by now that, where growth is concerned, it’s not going to happen with simple project management. In this sense, the thick books on project management can be scrapped with confidence. But a theme that growth-project managers return to time and again is communication. Communication about the state of the project is critical, especially in the case of key initiatives that are essential to the health of the company and that also enjoy special attention from Senior Management.
Below is a communications matrix that contains certain essential aspects of the types of communication, their audience, and frequency. We have had excellent experience with this practice. Adapt frequencies and add additional elements to customize it for your organization.

Clixk to view:

Target Audience/Participants

Reference: Quelle, Guido, Instrumental Support of the Development and Implementation of Market Segment Strategies in Commercial Enterprises, Dortmund, 2003.

© 2013, Prof. Dr. Guido Quelle, Mandat Consulting Group, Dortmund, London, New York. All rights reserved.

Make a decision – the right way!

Friday, December 6th, 2013

If you look around your environment, you can observe a phenomenon similar to one that I see regularly in our consultancy and always address:
When it’s time to make a decision, there is almost always a discussion about alternatives and options, without keeping in mind the goal that is to be achieved. Decision-making tools are deployed, emotions run wild, and heated battles are fought, regrettably without direction.
The attempt to answer question like:
• “Should we deactivate Unit 1 and instead ramp up the output of Unit 2?”
• “Should we establish a branch office in France?”
• “What are we going to do about Business Unit A?”
• “When should we begin the customer survey?”
must backfire when neither the purpose nor the goals are clear. When you’re stuck in a traffic jam, you can turn off the interstate. But that only makes sense if you know where you want to go. Otherwise all you’ve done is to turn off the interstate.
Companies regularly squander their energy, time, and nerves, play pointless power games, undertake unnecessary experiments to answer questions that can’t really be answered because management has not yet fulfilled their responsibility: to clarify intentions and goals.
First the intention, then the goal, then the alternatives. This must be an iron-clad rule of decision making.

© 2013, Prof. Dr. Guido Quelle, Mandat Consulting Group, Dortmund, London, New York. All rights reserved.