Hiring Strategic Technology Operating Partners
Technology is increasingly intertwined with business success, acting as the driving force behind innovation, growth, and in many cases, a company’s competitive edge. And for private equity firms navigating this landscape, the Technology Operating Partner has become a critical asset. This strategic advisor brings a blend of technical acumen, operational expertise, and industry insights. This combination enables private equity firms to maximise the value of their investments through the smart application of technology.
At the core of the Technology Operating Partner’s responsibilities lies the ability to navigate the complex intersection of business and technology. During the due diligence phase, their expertise is invaluable in assessing a target company’s technology capabilities, infrastructure, and digital assets. This comprehensive evaluation not only identifies potential risks and opportunities but can also inform investment decisions by aligning the target’s technology strategy with its overarching business objectives. Ultimately, the in-depth understanding of the technological landscape provided by the Technology Operating Partners helps the private equity firm ensure the right investments are made.
Once an investment is made, the Technology Operating Partner becomes an indispensable partner to portfolio company management teams. Collaborating closely, they help portfolio companies stay ahead of the curve, developing and executing technology strategies that foster innovation, drive business goals and boost sustainable growth. This includes defining long-term IT roadmaps that align with business goals; identifying high-impact areas for technology investments; and exploring how emerging tech trends like Artificial Intelligence (AI), blockchain, and edge computing can deliver a competitive advantage.
Unleashing AI-powered transformation
The emergence of AI has rapidly transformed industries, and private equity is no exception. In fact, PE firms are particularly optimistic about AI’s potential to drive revenue and efficiencies. Here, the Technology Operating Partner can play an important role in shaping a firm’s comprehensive AI vision and strategy. Harnessing the power of AI enables them to unlock new dimensions of data-driven decision-making and enhance due diligence through AI-powered tools.
Post-acquisition, AI can also be leveraged to optimise portfolio company operations, enhance customer engagement, drive revenue growth, and strengthen cybersecurity measures, among other transformative applications.
Driving operational improvements and efficiency gains
Beyond AI, the Technology Operating Partner is instrumental in driving operational improvements and efficiency gains through technology optimisation and automation. They assess existing processes, systems, and workflows, identify bottlenecks and inefficiencies, and recommend solutions to streamline operations, reduce costs, and enhance productivity.
Digital transformation is another critical area where the Technology Operating Partner’s expertise excels. By evaluating a company’s digital maturity, identifying areas for improvement, and developing strategies to accelerate digital adoption across functions such as marketing, sales, operations, and customer service, they empower portfolio companies to stay ahead of the curve and respond swiftly to market changes.
More than just an advisor, the Technology Operating Partner (TOP) bridges the business-technology gap, acting as a strategic partner and innovation champion.
Ultimately, the Technology Operating Partner’s overarching goal is to drive value creation within portfolio companies by leveraging technology as a strategic asset. By working collaboratively with company management teams, they implement technology initiatives that enhance operational efficiency, accelerate growth, and improve competitiveness in the marketplace.
Technology talent management
Talent is a key driver of success in every business. The Technology Operating Partner plays a crucial role in talent management, helping portfolio companies build and retain high-calibre technology teams, and ensuring that companies have the right talent in place to execute their technology strategies successfully. They achieve this by:
- Talent acquisition guidance: Advising on strategies for attracting and hiring top tech talent.
- Skill development plans: Creating plans to upskill current teams and address skill gaps.
- Organisational structure recommendations: Optimising team structures for maximum productivity.
Considerations for appointing a Technology Operating Partner
Carefully evaluating three critical factors is essential to ensure optimal alignment and value creation when appointing a Technology Operating Partner. The ideal candidate’s profile should align with the PE firm’s specific needs, investment strategies, and portfolio composition. A thorough assessment of the required skillsets, mindsets, and cultural alignment is crucial for a successful partnership across portfolio companies.
- Corporate vs private equity background: Individuals transitioning from prominent corporate technology leadership roles bring cutting-edge expertise in technology strategy, road mapping, and transformation. However, they may lack direct experience in the fast-paced and multifaceted private equity environment, where the ability to deliver rapid value across various companies is crucial. Seasoned private equity professionals on the other hand, have a deeper understanding of the industry’s dynamics and expectations. Conversely, accomplished “captains of industry” transitioning into private equity for the first time can bring fresh perspectives and innovative approaches.
- CIO vs. CTO: The roles of Chief Information Officers (CIOs) and Chief Technology Officers (CTOs) differ significantly in focus and objectives. CIOs traditionally oversee a company’s technology strategy and operations, aiming to enhance efficiency and align with broader business goals, often with cost considerations in mind. In contrast, CTOs tend to focus more on developing technological products and services to meet customer needs, driving external innovation and product design, potentially favouring technical excellence over cost optimisation.
- Breadth of technology experience: Some candidates may have extensive experience in large-scale technology investments aimed at driving transformation and creating value. Others may come from a background of restructuring, lean operations, and profit creation models. These divergent experiences can shape their approach to value creation through technology.
Partnering for success
At Redgrave, we excel in connecting forward-thinking technology leaders with PE firms ready for transformation. Our expertise goes beyond simply identifying skilled individuals; we understand the specific skillsets and mindsets needed to thrive in the ever-evolving PE landscape.
We work closely with our clients to understand their tech vision. Then we leverage our industry knowledge of emerging trends and expert research to identify the talent to champion and implement your tech strategy. This ensures you have access to the most qualified and adaptable talent pool possible, ready to advance your portfolio companies forward.
