Fast data wins: Quick projects from pre-deal to 100 days
AUG. 21, 2024
Demonstrating value in the first 100 days is critical, regardless of the timeline.
Private equity (PE) deals are as varied as the companies they involve. Some get done in a matter of weeks, while others drag on for months or years. Regardless of the timeline, demonstrating value in the first 100 days is critical.
The real magic happens when data-driven insights are integrated into the due diligence process, leading to quick wins that showcase your capabilities and build traction for larger-scale initiatives.
Creating a strong foundation in the pre-deal phase
The clock starts ticking the moment a private equity deal closes, and the pressure to deliver results is intense. It’s common to feel like there aren’t enough hours in the day, people on your team, or available funds to hit the ground running.
“Even though our clients routinely tell us that they’d like to standardize the value creation process in the first 100 days, they tend to end up recreating the wheel each time,” Lumenalta’s Dave Price explains.
The right partner can help overcome these challenges by supplementing resource gaps at a reasonable cost. They can assist in aligning data governance, validating data quality and compatibility assumptions, and identifying low-hanging fruit opportunities.
Data due diligence
Dive deep into the target company's data landscape. Assess the types of data available, their origins, and how they’re currently utilized. Pay special attention to data quality — its accuracy, completeness, and consistency.
Also, evaluate the company’s current data governance practices. An often overlooked but crucial aspect is examining the target company’s code base. Is it well-written and maintainable? These details can reveal significant risks that might not be immediately apparent.
Data migration strategy
A well-crafted plan serves as a guide to the technical aspects of moving and integrating data while aligning with overarching business goals.
Prioritize projects that offer high potential for immediate impact at a reasonable scope. Break down the migration process into manageable phases to ensure a smooth transition and minimize operational disruptions.
Clear and regular communication is key to keeping stakeholders informed and engaged.
Resource planning
Take a close look at the existing data team’s strengths and weaknesses. Identify gaps in skills, experience, or expertise. Craft a plan to address these gaps, whether through targeted training programs, strategic hires, or bringing in external experts to supplement your team.
Maximizing value in the first 100 days
The first 100 days post-acquisition are critical, much like a new presidential administration.
As Lumenalta’s Dave Price recommends, PE leaders should “focus their first 100 days on turning potential into tangible results.”
This initial period sets the tone for future success. By securing early wins, you can prove the business case for continued investment, gain crucial leadership buy-in, and pave the way for more ambitious data projects down the line.
Quick-win data projects
Implement the high-impact, low-complexity projects identified during due diligence. Showcase the ROI of your early successes — they should act as building blocks and ignite enthusiasm for future initiatives. Use Agile methodologies and rapid prototyping to accelerate progress and quickly iterate as unforeseen challenges arise.
Data integration roadmap
A comprehensive data integration architecture is your organization’s North Star. It outlines the long-term vision for your data strategy and aligns it with your overarching objectives and key results (OKRs).
This roadmap should not be a static entity. It should be a living document that evolves alongside your business. That being said, even as it flexes and changes, your roadmap should always include clear milestones and measurable metrics that keep you on track.
Change management strategy and communication
A well-thought-out change management strategy is key to winning hearts and minds. Put yourself in your employees’ shoes — proactively address concerns, build buy-in, and show empathy for their pain points. Highlight the positive impact changes will have on both the organization and individual stakeholders.
Provide comprehensive training and support to empower your team to navigate the transition smoothly. As Price points out, “Data is only as powerful as the people who use it.”
Best practices
Effective project management
Strong project management is the linchpin of successful data initiatives. Embrace agile ways of working, breaking projects into bite-size pieces to prevent overwhelm and create opportunities for rapid iteration.
Consider working in two-week sprints to keep your team focused on immediate goals and foster a sense of urgency and accomplishment. Adopt a minimum viable product (MVP) approach to prioritize features that deliver immediate value.
Collaboration and stakeholder engagement
Data transformation is a team sport. Focus on building bridges across departments and ensuring that everyone has a voice.
Communicate with stakeholders from both the private equity firm and the acquired company early and often, seeking their input, addressing concerns, and celebrating shared successes. Sharing and celebrating early wins reinforces the value of your efforts and creates a positive feedback loop.
Continuous improvement
Quick wins are just the first steps on your data transformation journey. To unlock the full power of your data, embrace a culture of continuous improvement. Always be on the lookout for ways to refine and optimize your data integration strategies.
Encourage your team to embrace a data-driven mindset, constantly seeking new insights and pushing the boundaries of what's possible. Invest in upskilling programs and foster a collaborative environment where data and analytics are valued at every level.
The data journey never ends. A culture of continuous learning and improvement ensures that your data strategy remains agile, adaptable, and consistently aligned with your evolving business goals.
The advantage of a data-driven organization
Private equity pros know what it takes to de-risk investments and accelerate value creation. The data landscape is similar — prioritizing data projects from day one can help you secure a lasting competitive advantage.
A truly data-driven organization is more agile, adaptable, and innovative. It can spot opportunities others miss, make confident, data-driven decisions, and quickly pivot when needed.
Prioritize these foundational data plays in your M&A strategy. It's your key to unlocking the transformative power of data and propelling your portfolio companies to new heights.
