私募股权的长期视角

What can the gods of private equity teach us about managing for the long term? If you think that their lightning reflex, do-what-it-takes approach has nothing to tell us about the long haul, you’d be wrong. Maybe you imagine they simply take a business private, load it with debt, strip its assets, then sell it a few months later for multiples of the purchase price—a strategy that seems decidedly hostile to the long term. But the experience of properties put through what I’d call a “strategy workout” by PE firms suggests that the exercise can actually enhance long-term performance—and that ownership over the long haul is neither necessary nor sufficient to set a company up for the future. Private equity’s footprints across the world economy get bigger by the day. The London-based research firm Private Equity Intelligence estimates that PE firms may raise $500 billion in new money this year, 15% more than in 2006; a Credit Suisse analysis suggests that, with the customary leverage, it’s within their reach to buy one out of every five U.S. and European companies with market capitalizations under $30 billion. Predictably, in certain quarters, screams have gone up about this supposedly rapacious new form of capitalism, with its mercenary focus on short-term gains. Looked at from another perspective, though, what’s striking is the degree to which PE firms, in their treatment of the businesses they acquire, are merely putting to use many of the best ideas and analytic techniques that have been developed in the corporate strategy revolution—the 40-year-old historical process by which companies have converged on strategy as the framework for understanding what they want to do. The difference between the conventional and the PE approach to strategy is that the private equity buckoes put their acquisitions through the formulate-a-strategy-and-start-implementing-it process in months rather than years. Are we seeing in their handiwork a sort of apotheosis of corporate strategy? Most PE firms are still driven fundamentally by a passion for deals and an uppermost concern with finances, but as those attributes have become commoditized over the past 15 years, more outfits have come to take an increasingly active, hands-really-on managerial role in the businesses they acquire (if only to distinguish themselves in the eyes of potential investors). The workouts they put their acquisitions through typically entail at least five of the major tactics developed in the evolution of strategy. They use debt aggressively (something the early partisans of strategy had to encourage their clients to do, stuck as they were in Depression-era thinking). They focus on cash flow, not on earnings reported for accounting purposes (early strategy consultants discovered that their clients didn’t actually know their real costs, obscured as those were in the way they presented their financial statements). They reduce costs relentlessly (believe it or not, before the revolution most companies didn’t think you could do this systematically). They identify a strategy that favors the line of business in which the acquisition dominates its competitors, and then they often sell off its other businesses (it was the strategy movement that got companies thinking about their assets as a portfolio of businesses, with some stars and some dogs to be divested). They think imaginatively about who would constitute the best owner for the business and ask how long an owner should hold on to the property (the correct answer is seldom “forever”). Strategy consultants, who do a surprising amount of work for PE firms—providing strategic due diligence before the acquisition, putting together a new, more-focused performance improvement plan after—describe their PE clients as the most economically rational of owners. Often this means they’re willing to dispense with niceties that publicly held companies view as sacred (Why not outsource human resources?) and to hold managers tightly to monthly, even weekly, goals. But as studies like a recent one by Josh Lerner of Harvard Business School and Jerry Cao of Boston College’s Carroll School of Management indicate, businesses that have been taken public after being owned by a PE firm long enough to be put through a workout—at least one year—typically outperform both other IPOs and the overall stock market over three to five years. (Most of the individual examples of such successes are middle- to small-sized companies you’ve never heard of or businesses carved out of larger corporations, as Lexmark, a manufacturer of computer printers, was from IBM.) If the stock market truly values a company’s future prospects, then, at least for some enterprises, a short, perhaps even painful, strategy workout at the hands of a private equity firm is likely to boost shareholder value over the long term.

私募股权的长期视角

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