Skills in demand: initiating and adapting to change in private equity

Introduction: it’s no longer about growth

There’s no denying that this is a particularly challenging time in the private equity market, thanks to persistent global inflation, geopolitical uncertainty, US trade tariffs and a host of other factors. With private equity firms looking at tighter cost controls and forecasting cycles, the emphasis for portfolio companies has moved away from growth and towards delivering profitability, operational efficiency and value creation.

With the market shifting beneath their feet, private equity firms are looking to reshape their business to give themselves the best chance of adapting. That means a whole lot of organisational change. Let’s take a look at the skills private equity firms need to initiate and adapt to change.

1. Digital transformation

Many firms are carrying out digital transformation across all corporate functions, particularly finance and HR, to automate manual processes, integrate systems and utilise data to drive decision making. We’re therefore seeing significant demand for transformation and programme delivery professionals who can lead restructuring and carveout integrations or system overhauls.

Though adapting its tech infrastructure is an important part of an organisation’s evolution, tech professionals need to be able to do a lot more than support IT operations. Private equity firms are looking for data and tech professionals who can deliver insights that impact cost, margin and customer outcomes, all with the intention of delivering value.

2. Transformation and turnaround experience

In today’s changing private equity environment, private equity firms need leaders with deep transformation and turnaround experience to help them unlock value. In the case of companies in decline or distress, that means being able to achieve results in short timeframes, within a complex and pressurised environment.

That’s no easy task. Firms need turnaround chief transformation officers who can restructure the leadership team, implement urgent cost controls and realign sales execution to improve profitability and drive value creation.

3. Adaptable leadership

Private equity leaders who can quickly adapt, and take the organisation with them, are like gold dust in times of uncertainty. That means bringing in quality senior professionals who are incredibly good at their day job and also have a number of other strings to their bow. For example, finance leaders don’t just need to be able to crunch numbers and keep the organisation compliant. They also need commercial acumen to support the business’s value creation plans, and the ability to accurately model scenarios and improve forecasting accuracy so the business can futureproof itself. Similarly, COOs need to be strategic, transformative and tech savvy as the business looks to embed change.

4. Culture and communication

From an employee’s perspective, the cultural shift that can result from organisational change, whether it’s a new HR system, a restructure or a merger, can be incredibly disruptive – especially for those who have been there for a long time. Failing to properly explain and communicate a significant change to the business can really alienate your people.

It’s important that organisations first canvass employees’ views on significant changes in order to show that they value their opinions and are keen to make them a part of the process. When introducing a new tech system, for example, focus groups can be an effective way of keeping your people informed, ironing out any concerns and showing them that this isn’t just another bit of tech they didn’t ask for.

Restructures and mergers will not only affect your employees’ relationships and interdepartmental dynamics, but also potentially make them concerned about their job security. To help embed this kind of change, private equity firms are seeking people and talent leaders who can drive and navigate culture change post-acquisition or integration. Crucially, these are professionals who also know how to communicate change with honesty and transparency.

Talent demanding trust

Finding private equity leaders with the right mix of skills, who can essentially take your organisation in a different direction, is no easy task – not least because candidates are understandably cautious about moving in this challenging business environment. Our daily conversations with private equity leaders show that they want to work in agile environments where they can have an impact. That’s why it’s important to show them a clear vision and give them the opportunity to build something. Let them know that you’ll support them in challenging times and won’t revert to cost cutting and redundancies when things get difficult.

Conclusion: the leadership talent to help you adapt to change

Leaders who can help organisations adapt and initiate change are crucial in an uncertain market that shows no sign of stabilising anytime soon. Private equity firms are looking for adaptable and skilled senior professionals who can drive digital transformation, turnaround strategies and cultural change. But to do that, they need to be transparent about their vision and give these professionals everything they need to make an impact.