Teamscope use case by a leading Private Equity firm

The Client

Our client, a respected Private Equity firm with more than 30 years of experience and more than 120 investments, wants to be the most sought after private equity investor and the partner of choice for management teams. Their investment approach is to take the majority equity position in companies that grow faster than the broader economy.

Being a responsible investor, the PE firm wants to build a good working relationship with the management teams of the portfolio companies. They provide the companies with extensive support while also granting enough freedom to founders and leadership so that they can run the business the way they prefer.

Talent Team and its Challenge

The PE firm recently established a Talent Team to support the management teams of both acquired and existing portfolio companies. The team was tasked with handling all C-suite related talent activities across the portfolio: talent acquisition, leadership assessment and development. The Talent Team believes that the management team of each portfolio company is crucial to the success or failure of the company and that hiring and retaining a robust, adaptable leadership is an essential part of the value equation.

One of the challenges for the talent team was to find reliable, scientifically proven tools to assist with leadership assessment and team development. The existing leadership assessment tools proved to be time-consuming and provided no direct output for business decisions.

Talent Team was looking for something that would add clear value to the leadership team, would not take the team away from their daily activities for considerable periods of time, and would equally help the leadership team and other stakeholders – investment managers and board members.

The Solution – Teamscope Platform

An executive search partner introduced the team to Teamscope, a tool the search partner had started using themselves to add more value to their clients. Teamscope is a SaaS platform, developed by leading executive search professionals, coaches and data scientists. It combines decision science with data analytics and is mainly used for:

  • Data-based hiring to increase deep-level diversity and reduce hiring mistakes
  • On-boarding the selected candidates to help them build good working relationships with the team-mates quickly and effectively
  • Developing teams to build a winning organization
  • Facilitating peer-to-peer learning and mentoring

Teamscope gathers thousands of data-points per team and visualizes the result in real-time using a proprietary algorithm that is based on hundreds of different scientifically validated facts about high-performing teams. The results are effectively usable for managers with no prior training, and interpreting the data does not require a consultants presence.

This 3-minute video gives a brief overview of the platform.Screenshot (219)

The Use Case

The Client had acquired a majority of a mechanical engineering company. The two co-founders work in C-team, several other management team members are long-time employees, several of them with a background in high-level academic research. Part of the team is new, hired during the few last years of business expansion.

A working hypothesis by the Portfolio team was that the C-team might lack some of the competencies for rapid growth that is expected after the investment. Overall understanding of the team culture and its development needs was expected.

Talent Team decided to use Teamscope as a vital element of the onboarding process for this new portfolio company.

The following process was planned:

  1. All Management Team members complete the Teamscope profile (it takes around 20 minutes);
  2. The talent Team lead has short interviews with all team members;
  3. A half-day team event co-facilitated by Teamscope and Talent Team was planned to debrief the team, discuss the findings and plan necessary actions if any;
  4. A de-brief with CEO, Chairman and Investment Managers.

Due to recent travel restrictions, the team event was conducted virtually and shorter than planned – in the format of a 2-hour webinar. All the other steps were also executed virtually. Additionally, individual briefing sessions with the CEO, the newly appointed Chairman, and the HR Manager took place. In the follow-up, the members of the management team decided that the data in the Teamscope environment would be valuable for additional use. Teamscope provided them with a series (10) of 1-hour exercises using Teamscope data that the management team is now using as part of their weekly meetings.

The Results

  • All data presented below are anonymized and are meant to serve an educational purpose in understanding the basics of the analysis. Any similarity to real teams or organization is entirely coincidental.

Teamscope summarized results for the management team are the following:

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The team’s personality map is the following:

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As the figure illustrates, the team is moderately diverse, except on the openness scale where the diversity is very high.

Team values are the following:

The team’s core values are in spheres of openness and self-transcendence: loyalty, kindness and creative freedom. At the same time, there are several values where team members’ preferences are sharply polarized, and the potential for conflict is high. For example, some team members (including the CEO) do not care much about capital and control, while these values, belonging to the self-enhancement group of higher-level motivators, are important to some team members.

Partly this appears to be the differentiating line between the “old” and “new” members of the team – the latter being more oriented towards profit and influence, while other team members are more interested in the common good and wellbeing of others. Both are in tune with the vision and mission of the company, but the acknowledgement of these differences was an important finding for both the CEO and the newly appointed Chairman of the Board.

For purposes of additional insight the new Chairman of the Board and the CEO were compared. For both of them, the result was eye-opening: they discovered profound insight that helped them understand several frustrating interactions that had taken place. The CEO and the Chairman appeared to be very similar in their personality traits and competencies, but mildly different in values.

 

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This is not an ideal combination for a good collaboration relationship, and the opposite might be desirable. People who are similar in values and different in everything else, especially their behaviours (personality traits) and competencies build a trusting relationship where conflict is easy to bear, and different approaches to things create synergy and agility. Realizing these issues, the Chairman and CEO could work through and agree on some rules for their interaction to improve effectiveness.

The Chairman of the Board said:

This is the most effective way of analysing teams I have encountered. Perfectly valid and very cost-effective, considering the output and resources used. Some of the findings were real eye-openers, confirming my gut feeling. Some made me think about situations where I had the feeling that something was not right, but now I could clearly see what I can do to modify my behavior for better results.”

The Conclusions made by Talent Team:

  • Teamscope provided valuable input for planning and executing the management team’s onboarding to the Client’s Portfolio.
  • Teamscope should be used at an even earlier stage (in the pre-investment DD process and in the process of selecting and onboarding new stakeholders)
  • Teamscope is an excellent tool for PE Talent Team and will be the key component in the process of onboarding new and supporting all management teams of the Portfolio companies.

To learn more about the teamscope.io platform and its main use cases, contact us at teamscope@teamscope.io or book a demo.