Digital Mindset for Growth Capital
Updated: Aug 25, 2020
Previously, we wrote about how Digital Mindset should be utilised in business turnaround strategies within distressed asset management. Having said that, the application of the mindset is not constrained within this scenario and can also enhance growth capital.
Growth capital, by definition, focuses on transformational events in the lifecycle of a company; be it expansion, acquisition or turnaround. The general approach projects improvements in operations, products and sales within the company’s traditional business boundaries, perhaps with some piecemeal digitalisation bolted on.
Such companies miss their potential to be a hybrid company.
Hybrid Companies will be Future Proof
Companies tend to stay in their own lane - either an established traditional business or a digital-first startup, each with their unique knowhow and expertise. These ecosystems rarely and truly intersect, but we believe that companies need to bridge this gap between traditional and digital ecosystems to transform themselves into hybrid companies, where you embed the best of both worlds for your future relevance and success.
Growth Capital is best placed for Hybrid Transformation
This stay-in-your-lane approach does not maximise the long term value of the investment as it does not take into consideration the rapid digitalisation of the economy - beginning with consumer behaviour and its impact on the company’s business model.
In order to create sustainable growth bearing higher multiples for investors, Digital Mindset needs to become part of the DNA of the company across all assets, processes and people. It is profoundly different from piecemeal acquisition of technology, as it forms the connecting tissue that lays under every operation of the business:
A Combined Approach: Traditional + Digital Mindset
We layer our digital knowhow on top of all the essential financial assessment, planning and execution stages owned by the business/financial consultants to create a truly combined force of long term value generation in growth capital.
In the Future Proofing Assessment stage; we review the digitalisation potential for all assets and processes of the company alongside adaptability of the workforce including leadership. It is a current picture of where the company stands from an asset, process and people perspective.
The Mindset Integration stage consists of the development of a bespoke Digital Mindset strategy and activation plan to be agreed by all stakeholders. As in everything else, people are at the core of the plan and the key to the long term success of the transformation, so training, coaching and hiring also happens at this stage.
The final but arguably the most crucial stage is the Transformation Supervisory where we help establish the transformation committee and run regular reviews carrying execution accountability. This stage ensures that the transformation is not a one time event but a perpetual process that leads to sustainable growth in the future without the need for further consultations.
If you'd like to discuss the Digital Mindset approach with your investments in mind, please reach out to us here.