Accelerating Growth at Multi-OpCo Businesses
Elias Mazzawi shares a company article that outlines three core strategies to accelerate growth for multi-OpCo businesses.
Growth is always top-of-mind. Never more so than when interest rates rise and recession looms. Strategies get revised, budgets and forecasts move, investment is more closely scrutinised and risk takes on a new profile.
The need to drive value gets more focused. Cost reduction is often a quick win but limited. The search for rapid and sustainable revenue opportunities moves to the fore. Multi-OpCo businesses start to look more eagerly across boundaries at whole-greater than the sum-of-the-parts opportunities.
Leveraging the client-base and product-set across the whole company represents substantial and possibly game-changing untapped revenue.
While the RoI from revenue synergy can be huge, few organisations reach full potential. Strategy is straightforward, implementation presents many challenges, and depending on business scale and organisation structure, can involve working across P&L and management boundaries; transcending business-as-usual processes, metrics and ‘turf’. Often, in the relentless focus on in-OpCo growth, ‘cross-OpCo’ just doesn’t get the attention and focus that the potential return merits.
Over the next 3 months, we are releasing a trilogy of thought-papers on how businesses drive activity across often independent-yet-connected OpCos. Our aim is to stimulate thinking and activity that requires little investment and can yield returns rapidly.
Part 1– included in this post, outlines the 3 core strategies.
Part 2 – draws on lessons from experience.
Part 3 – focuses on next steps.
3 core strategies
Straightforward in principle | implementation presents challenges
There are 3 core approaches to cross-OpCo revenue synergy: cross-sell, client management synergy and proposition synergy. Most organisations pick a hybrid. Strategy is typically straightforward to define; implementation requires activity across organisational boundaries, and can present cultural and operational challenges. Trust and alignment of targets, objectives and incentives at OpCo and individual levels is key.
Strategy 1 – cross-sell is usually where organisations start; selling a discrete product or service from one part of the organisation to a client of another.
In terms of potential, typically it delivers incremental rather than game-changing revenue; one product at a time.
Organisation and infrastructure-wise, it is relatively straightforward, requiring requires channels and processes to encourage cross-sell; which can be once-off or campaign-based. It needs mobilising typically through pragmatic CRM-based operations and incentives and fairly focused pipelines.
Key points include:
- Client management synergy
- Proposition synergy
- Cross selling
Read the full article, Growth at Multi-OpCo businesses, on 4H2DLtd.com.