Human capital is increasingly being used as a lever for value creation in private equity, as investors focus on optimising their portfolio businesses and finding ways to create competitive advantage. In the past, only large private equity firms had enough scale to employ a team of operating partners, or the budget to engage traditional consulting firms to access the skills and expertise they needed. This is no longer the case.

The continuing evolution of the interim market means that skilled value creators can now be deployed by businesses in a highly targeted, highly cost-effective way. In fact, interim professionals are fast becoming an essential part of the value creation toolkit. Businesses that fail to use them effectively risk falling behind.

Making interim a tool for value creation
The days of simply buying a business, refinancing on preferable terms and exiting at two times the return are long gone. As the cost of debt has risen, the focus has turned instead to value creation. Investors looking to maximise returns need to explore every available avenue for optimising business performance and gaining competitive advantage.

When looking to increase value through human capital, businesses are now turning to interim resources. Far from being a stopgap measure, the interim model enables investors to utilise specific skills and real-world experience to achieve maximum potential in a targeted way.

 

““Interims offer you a two-for-one solution. Yes, they will come in and manage the functional finance area… but they will also act as an internal business consultant. For the CEO and the investors, the interim can provide immediate and lasting value. ””

Paul Schmidt, recently interim CFO for payments solutions company Sycurio

Deploying interim finance leaders to maximum effect
Ask today’s interim finance leaders what they are doing in their current roles and very few of them will mention accounting. In a recent Bronzegate poll, the majority of interim CFOs said that their key priority was either business transformation or building the finance team. What we are seeing is that their remit often involves addressing and resolving specific business issues. This can be anything from fixing specific FP&A requirements in a business to driving growth through merger and acquisitions , through to business partnering and professionalisation.

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