Carve-outs today are an increasingly pressurised environment, with the time to complete and start performing as standalone entities post-separation diminishing.
The mindset shift required from that within a parent company to a new standalone position can be characterised in a number of ways, but there are three that we think are vital for NewCo leadership teams to keep front of mind ahead of Day 1 and beyond, to ensure rapid self-sufficiency and successful realisation of value creation plans.
Prior to completion, it is critical align leadership of the new entity in a coordinated approach to the transformation ahead. Carve-outs present a huge opportunity to effect significant change and this roadmap should be documented and agreed well ahead of close.
A relentless focus on the customer
Maintaining business as usual operations during the various stages of the carve-out process can be challenging. Day 1 signals the start of a brave new world, but many customers will expect to receive an identical – if not better – service than that which they have become accustomed to.
Ensure adequate investments are made to improve customer service and loyalty, and target areas where insight can be gained from customer research, identifying opportunities to rectify previous missteps and proactively respond to any areas of unsatisfactory sentiment. This will minimise the likelihood of losing customers post-close, protecting value and vital revenue in the early stages of separation.
Be bold and disrupt yourselves
There is no better time to reimagine “a better way” for a business than in the carve-out process. Some major shifts in operations, people, and technological infrastructure will be necessitated by a new standalone structure, but push the boundaries on this to explore other ways to leverage innovative digital tools, reporting mechanics, and other industry intelligence to create the fittest, leanest business set for an aggressive growth trajectory.