Questions to Help (Re-)Assess a Company’s Performance

Capital markets

What has driven our historic shareholder returns over various time horizons?
How does our valuation stack up to peers’ today, and why?
What are the highest-impact levers to change our valuation (growth, margin improvement rates, etcetera)?

Strategy

Are we in the right businesses, geographies, sectors, product lines, and customer segments?

How can we strengthen our competitive advantage in these chosen areas?

What are our highest-potential M&A, partnership, and divestment opportunities?

Commercial

What are our opportunities for revenue growth (volume and pricing)?
What is the current profitability of each area we choose to play in, and what is the potential?
What are customers saying and competitors doing by channel, segment, and product?

Cost and capital

Where do we have direct and indirect cost improvement opportunities?
How can we substantially enhance the ROI of our capital expenditures?
How can we make our capital structure more resilient?

Organization

What radical improvements can be made to communication and engagement?
How can we enhance our execution capacity and speed (for example, through structure, incentives, and review cadence)?
Where do we need to refresh talent and our talent proposition, and where do we need to build new capability?

Reputation

What is our impact on the environment, and how can it be improved?
How do we perform on social topics (for example, diversity, well-being, and community involvement)?
How strong is our governance model?

Those in the private equity world will recognize that pursuing clinical answers to these questions is taking a page out of their playbook. In that world, an asset is reassessed every two or three years, and bold actions are taken accordingly. The idea is to view a company through the eyes of theoretical new owners looking to form a new investment thesis and, in doing so, acknowledge that both the company and the external environment will have changed meaningfully since the previous investment thesis was formed. It also encourages important voices of dissent to “speak truth to power” where needed. This thought process is helpful in any organization.