Operating Partner

D10 - Operational Leverage

Definition

A PE firm representative who works directly with a portfolio company's leadership team, typically with a focus on operational efficiency improvement, measurement standard elevation, and exit multiple enhancement.

An operating partner's presence accelerates the operational standards that a company would have eventually needed to implement regardless.

Understanding the operating partner's priorities, such as OLR improvement, documentation quality, and metric validity, gives an operations leader a clear brief for what "good" looks like in a PE context.

Indicators

• A PE operating partner has identified operational documentation or measurement gaps in a portfolio review.
• Standard PE reporting requirements are producing data that doesn't exist in current operational systems.
• The connection between operational improvements and transaction value has never been calculated.

Quick Win

• If you have an operating partner, ask them directly what one operational metric they'd want fixed first.
• Their answer is your priority list.

Assess

• Take the HQ Score Assessment

Apply

• The Operational Capacity Forecast Model
• The Operations Dashboard Builder

Related

• PE Operating Model
• EBITDA Quality
• Exit Readiness
• Value Creation Plan