Changes in PE market dynamics are giving rise to value-creating initiatives stemming from organizational health and talent insights.
In the past few months, we have seen changes in the dynamics of the PE market - with everyone looking for ways to accelerate impact. Entromy has become known for enabling PE investors and their portfolio executive teams with quality insights to unlock value creation around organizational health and talent topics. With tighter markets, increasing focus is now on translating the organizational and leadership insights data into how they will influence financial impact to prioritize change initiatives. Mapping talent to value and being able to speak to the accurate financial risk that can be mitigated by talent and operating levers has become the hot topic in conversations. I believe there are a few reasons why this trend is gathering pace: ➤ With holding periods becoming protracted and higher cost of capital to realize originally underwritten returns, deal teams that are relatively new to operational value creation are seeking ways to understand how Talent can be the ace up their sleeve. ➤ Talent partners are looking to move from a model where they are traditionally seen as support for executive search, executive evaluations and best practices on comp and performance management towards a model where they work hand-in-hand with deal leads and portco executives to speed up value creation initiatives. ➤ Higher interest rates make the time lost de-risking a deal from a Talent perspective much more expensive, as holding periods become more expensive. ➤ LPs are looking for exits in an environment where these can be hard to come by. As we see the interaction of deal and talent teams changing, our role in supporting our PE partners is evolving as well. #valuecreation #organizationalhealth #talent #privateequity #leadership