Lessons from Private Equity Any Company Can Use

Harness the Talent

How do the best PE players achieve their spectacular returns? One part of the answer lies in their ability to harness talent. As we’ve noted in the previous section, this means people up and down the chain of command, but particularly in frontline positions in the key-initiative areas. It means linking rewards with performance—a subject introduced in the previous section, which we’ll delve into more deeply here.

It also means building and using the board of directors. PE owners give the boards of directors of their portfolio companies much running room. In fact, by bringing their special talents to bear, those boards often play an absolutely critical role in the success of their companies.

How PE Firms Harness Talent

PE players ...