May 26, 2010

WHAT IS OPERATIONAL DUE DILIGENCE?

It is a known fact that investment firms and professionals are spending a significantly greater amount of time analyzing the operations of a company during diligence . The years leading up to 2008 and 2009 saw the largest number of deals closed in history. During this time, many investment firms overlooked flaws in operational performance as they continued to pursue increasingly leveraged assets. Many firms learned this lesson the hard way. Countless PE backed deals were forced into bankruptcy as orders decreased rapidly and debt repayment became impossible. The firms that were able to navigate these waters and whose funds have re-emerged in relatively healthy positions were those that placed great focus on operational performance and were able to work with management teams providing guidance and direction during restructuring.

This month, TriVista is releasing the first installment in a whitepaper series titled “What is Operational Due Diligence?” This series will attempt to shed some light on the meaning of Operational Due Diligence and will provide guidance to investment professionals working primarily within the manufacturing space.

The series begins with an overview of Supply Chain Diligence, and will continue by focusing on the following areas:
• Supply Chain Management
• Engineering & New Product Development
• Factory Footprint
• Lean & Six Sigma
• Critical Operational Processes
• Plant Assessments
• Key Employee Interviews
• Productivity Analysis
• Industry Benchmarking
• Operations Team Assessment

We hope you enjoy reading these articles and look forward to receiving your comments and feedback. Please click here to find the first month’s article titled “Supply Chain Due Diligence.”


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