PMCC Interactive

Author: Pat McCormick

  • Back at it — and energized for what’s next.

    In July 2024, I stepped in to help lead a turnaround effort at Urban Engineers, Inc. After a focused and productive year, that chapter is moving into a new phase.  I Congratulate the two new leaders named today- Jim Bilella as CEO and Chris Bobrowski, CFO.  I worked very closely with each and know that each will do the job necessary for Urban to reach it’s objectives.  I will be remaining on the Board of Directors.   AND I’m excited to return full time to PMCC Ventures.

    For those who’ve followed the journey, this latest assignment brought things full circle. Urban’s HQ is across the street from where my consulting career began in 1984. The lessons I learned in my 20s — from auditing an ENR Top 5 firm — still proved useful in my 60s. Some fundamentals really do hold up.

    What’s next?

    • PMCC Ventures is once again open to new engagements
    • We remain focused on strategy, business readiness, leadership transitions, and unlocking value through better insight and execution
    • We’re continuing to help owners prepare for and execute successful exits

      The M&A market is active — but more crowded and complex than ever. Standing out requires more than just a good story.
      • Performance matters
      • Sound insight and foresight is rewarded
      • A clear sense of what is possible and achievable is essential

    We’re here to help business owners position themselves credibly and confidently.

    But M&A is only part of the work. At our core, we still believe:
    Good information + grounded leadership = real change.

    More to come soon.

    If you’re wrestling with complexity — or just want to sharpen your thinking — let’s talk.

  • Great Business leaders revel in the challenge of creating and sustaining value in uncertain times.

    Welcome to the beginnings of a discussion for Business Leaders steering their ships through the economic tempest of our current times. Picture this: you’re navigating through a treacherous blend of headwinds that push you back, tailwinds that propel you forward, and swirling winds that make your compass spin in dizzying circles. New conditions seem to arrive much faster than they did in the past and certainly the press reports with speed and veracity- and much of the early reporting is inconsistent to say the least.  Now, stop picturing it. This isn’t a hypothetical scenario; it’s the daily reality for modern business leaders.

    This discussion provides some insight, but is really intended to provoke a look in the mirror about your organization and its financial management capabilities that you should expect and need as you pursue value creation and sustainability efforts for your company.

    Here’s the kicker: in this whirlwind, you have no choice but to create and sustain value. Mediocre leaders may hide behind the guise of unfavorable conditions, but the great ones? They revel in the challenge, they thrive on the chaos, and they see opportunities where others see dead ends.

    We believe that Great Finance plays a strong role in the development and operations of a Great Company.  Sure, other roles have their important roles, but we are here to start the finance conversation.. While finance doesn’t inherently create value, imagining a successful venture without this capability is akin to envisioning a skyscraper without scaffolding. Great finance isn’t a crutch; it’s a catalyst. It arms businesses with the data-driven insights required to understand the evolving facets of their value chain, making the elusive task of value creation a bit less Sisyphean.

    The challenge is that not everyone has Great Finance– and we struggle to define what that looks like- because, beyond the fundamentals, the real juice is the specialized capabilities that are created and needed for YOUR business. We know this is an ongoing effort as Great Businesses relentlessly try to improve their business.

    But for starters, lets agree that Great Finance helps the company know more about their business and value chain and shares and communicates that information and insight with the rest of the organization to enhance financial literacy and to promote fact based operational and strategic decisions- and they do it fast, continually, and consistently.

    Intrigued? Buckle in. We’re diving deep into the mechanics of leadership, value, and the essential role of Great Finance in shaping this ever changing yet fascinating landscape. Welcome aboard!

    Read more:https://pmccinteractive.com/wp-content/uploads/2023/10/finance-and-value-creation-go-together.pdf

  • Do you believe you have room to create more value in your portfolio?

    Do you believe you have room to create more value in your portfolio?

    You know this- there is a lot going on inside of your investments, and there all sorts of winds- not just head or tail- but worse: swirling are buffeting your portfolio each and every day.  As a sailor, pilot and long-time business leader-I have learned to respect and read the winds- and do my best to assess and act to deal with them to get where I want to go. 

    Most of our work over the past 40+ years has been involved with transactions of some sort- buying or selling- or fixing in between.  Our experience as business and strategy consultants, business leaders, M&A transaction supporters and Board members has not only shaped and enhanced  our perspectives, but have contributed to our experiences to help our clients to move forward fast and with confidence.

    Based on all of this, we believe that for a company to create and sustain value they have to

    KNOW MORE NOW  

    And they have to have that knowledge and insight across the whole value chain of their business- and integrate the Executive team’s thinking to make comprehensive decisions that count in the realm of creating and sustaining value.

    And…Great financial Management Capabilities can really help you accomplish this.

    If you want to explore further click here

    Click here to learn more about PMCC Ventures or Pat McCormick

  • Embracing Great/Strategic Finance in Middle Market Companies: The Need, the Challenge, and the Payoff

    The concept of strategic finance has been in the discourse for over 25 years, yet the phrase “Becoming more strategic” remains pertinent, especially for middle market companies. The sector often faces unique challenges, balancing between the agility of small enterprises and the resource availability of large corporations. This balance makes the need for great or strategic finance both critical and complex.

    Defining the Ambiguous: What is Great/Strategic Finance?

    Strategic finance is elusive to define, often reduced to a “you know it when you see it” kind of standard. But let’s not get lost in semantics. Instead, let’s focus on its function—to aid leadership teams in creating and sustaining value. Strategic finance doesn’t inherently create value; rather, it serves as the intersection of critical data flows within the organization. It can collate this data into actionable insights, helping to understand the company’s economic engine and enhance financial, strategic, and operational literacy.

    The Endgame: Creating a Sustainable Competitive Edge

    The primary aim of great or strategic finance is to equip leadership with the tools and knowledge required to make better decisions, thereby creating a sustainable competitive advantage. Building this capability is easier said than done, evidenced by the businesses that fail to accomplish it. However, it is precisely the challenge that makes it worth pursuing.

    Pragmatic Steps Toward Realization

    Based on extensive experience working with middle market companies, the following steps are suggested for those aiming to realize the benefits of strategic finance:

    1. Prepare the Field

    Before you sow the seeds of strategic finance, your organizational soil needs to be fertile. Alignment across departments, clarity in objectives, and commitment from top leadership are prerequisites.

    2. Define Your Strategy

    Knowing what you aim to achieve is crucial. Outline the strategy that will guide your business activities and the key metrics that will measure progress through the execution phase.

    3. Understand the Interplay

    Recognize the symbiotic relationship between strategy, operations, and finance. Each affects the others, and understanding this dynamic helps in creating a well-rounded view of the business.

    4. Information is Power

    Determine the types of information that will empower your team to “Know More Now.” This could involve real-time dashboards, automated reports, or deep-dive analyses that intersect strategy, operations, and finance.

    5. Data Processing

    Agree on robust methods and processes to capture data and transform it into meaningful insights. Whether it’s through advanced analytics, machine learning, or good old Excel, the key is to make the data digestible and actionable.

    6. Integrate Insights

    Don’t let your newfound knowledge gather dust. Integrate these insights into planning cycles, accountability metrics, and reward systems, ensuring that the language of value creation becomes a cornerstone in organizational decision-making.

    Beyond the Basics

    While these steps lay the foundation, the journey toward great or strategic finance demands more. It involves honing various other capabilities and strengths that the finance team must develop. And it starts with helping the organization “Know More Now.” This not only aids in quick decision-making but also creates a foundation upon which other disciplines can be effectively built.

    Conclusion

    Strategic finance is not merely a concept but a necessity, especially for middle market companies looking to edge out the competition in today’s complex business environment. It involves an iterative process of gathering data, generating insights, and implementing them into action—all aimed at the ultimate goal of value creation. Therefore, the time to become ‘more strategic’ is not in some distant future; it is now.

    Intrigued? Download our presentation for a deeper dive into how you can implement these concepts in your organization.

    In the meantime, if you would like to connect- here is my email: pjm@pmccventures.com

  • Balancing Value Creation and Cost-Cutting: A Strategic Imperative for Today’s C-Suite

    Or, don’t just lunge at cost cutting- adopt approach that helps to focus on value creation and cost alignment

    In the current business climate, the challenges are twofold: sustaining profitability and maintain the capacity for value creation. There’s a heightened focus on cost-cutting as the immediate remedy for financial ailments. However, knee-jerk reactions can be detrimental in the long term. This post aims to shed light on the equilibrium between cost management and value creation that C-suite executives must strive for, especially in middle-market companies with revenues between $50 million and $5 billion.

    The Temptation to Just Cut Costs

    We are in a phase of the business cycle where cost-cutting seems to be the elixir to all problems. The media spotlight on downsizing and operational cutbacks can tempt leaders to make hurried decisions, focusing merely on reducing expenses. This approach may show quick wins, but the medium and long-term implications often offset these immediate benefits.

    Lessons from the Past

    The history of Leveraged Buy-Outs (LBOs) in the mid-1980s offers valuable insights. The dominating narrative was to “cut costs,” and it seemed like the logical step to generate sufficient cash flow to service debt. However, many businesses realized that this approach was not sustainable ad many cost cutting only exercises diminished the ability to quickly pivot as competitive positions changed  and the goal was not just to survive, but be prepared for value creating exits that rewarded owners and investors for the risk they undertook.  As it turns out, the goal is common, but indeed the approach does depend on your starting point, and capacity and capability to undergo change.

    Assess, Plan, and Act

    Before embarking on a cost-cutting mission, it is crucial to take a step back and assess the situation you are encountering- “why you are here” the competitive environment and ultimately what you are trying to achieve.  Here are some thoughts that might help sharpen your team’s thinking about the challenge and the opportunity.

    1. Alignment with Core Strategy: Make sure that changes you make and the resulting  cost-structure, supports achievement of your value creation goals, as well as your short term actions necessary to “weather the storm”. 
    2. Future-Readiness: Cost-cutting should not come at the expense of innovation and future growth that is in line with your goals and mid and long term value creation.  At the same time, this concept should not paralyze the efforts to get ahead of the real challenges you face.
    3. Employee Morale: Dramatic cutbacks can have a cascading effect on employee morale and productivity, affecting your most critical resource.  And at the same time, our experience is that many employees question what took leadership so long to come to grips with these critical matters.

    Balancing the Scale: Value Creation and Cost Cutting

    To achieve sustainable growth, businesses need to find a harmonious balance between cutting costs and adding value:

    • Invest in Talent: Reducing headcount may bring immediate cost savings, but investing in the right talent will yield productivity and cost gains along-with mid and long term value creation.
    • Technology as an Enabler: Instead of slashing technology budgets, consider how automation and digital transformation can lead to both cost reduction and value addition.  Also consider how technology can be used to both improve outcomes and help key employees do their jobs better and feel like they really contribute to the success of the business.
    • Customer-Centric Approach: Instead of compromising on customer service, explore ways to enrich customer experience. This is a powerful energy source for these efforts and the business
    • Data-Driven Decision Making: Utilize data analytics to identify inefficient processes and operational bottlenecks. This approach enables informed decisions, rather than across-the-board cuts.

    Conclusion

    Cost-cutting is not inherently detrimental; it becomes so when it overshadows the more vital goal of creating value. As a C-suite executive, your role isn’t just to survive the downturn but to position your company for future opportunities. By maintaining a balanced approach between cost management and value creation, you are laying the groundwork for sustainable growth and long-term success.

    For a deeper discussion and more targeted strategies on balancing these aspects, just click here

    https://pmccinteractive.com/wp-content/uploads/2023/09/20230918-value-creation.pdf

    Or reach out directly: pjm@pmccventures.com or  calendly.com/pmccventures-pjm-4

  • Meet Pat McCormick, Founder of PMCC Ventures

    Background information for Pat McCormick

    Meet Pat McCormick, a man whose work for clients is defined by a rich business leadership experience spanning over four decades. As the President of PMCC Ventures, Pat’s mission is straightforward: empower businesses to enhance their efficiency and sustain value.

    A diverse range of roles has carved Pat’s journey, from board memberships and interim leadership to consulting and advisory relationships. His expertise usually shines brightest when PMCC Venture’s clients find themselves at a critical junction, undergoing or contemplating a significant business transition.

    What sets Pat apart is his strategic mind and bottom-line-driven approach, grounded in diverse industry experience and a deep understanding of business life cycles. His strength lies in swiftly comprehending, analyzing, and assessing the current business environment, comparing it to established best practices.

    Pat’s working style is dynamic, pivoting around empowering organizations and people to navigate and thrive amidst change. His rigorous yet collaborative approach is fueled by a passion for fostering individual and team development, collaboration, and performance.

    At the heart of Pat’s business philosophy lies the desire to position organizations not only for present-day excellence but also to create sustainable growth for future opportunities. He firmly believes in the ability of businesses to withstand commercial challenges and turn them into opportunities.

    Pat’s career trajectory began at Arthur Andersen’s audit practice, where he spent over two decades, helping shape the Business Consulting Practice in the firm. Much of his work in the 1990’s was helping organizations improve performance and create value, along with a long list of Merger and acquisition support.   He held significant roles, including leading the Finance Business Solutions Practice in North America and Europe- helping large and global organizations reshape their financial management practices and teams and placing more emphasis on strategic and operational support for the business.

    His expertise then steered him to serve as the CFO of a start-up internet “instant messaging” company and then as the CFO/COO of, a brownfield real estate developer, where he led efforts to restructure more than $1Billion in debt and equity positions.  He also worked as a Managing Director at Alvarez & Marsal, a turnaround and consulting firm.

    In 2007, Pat established PMCC Ventures, a firm dedicated to business turnaround and performance improvement. His work has spanned from serving as a board member for a regional bank and an engineering firm to filling various Fractional and Interim Executive Leadership roles, all focused on transitions, transformation, and value creation.

    In 2023 Pat decided to focus more intent efforts helping Middle Market Companies improve the financial management capabilities of the organization. Recognizing that the Role of CFO was becoming more diverse and intense, he is choosing to support financial leaders in building the financial management capabilities they want and need.

    Pat’s efforts as shaped by his background as M&A leader and supporter, CFO and Board membership. He views some of the more critical roles of finance today to include, enhancing financial literacy throughout the organization so leaders understand the economic and value creation engine of the business and can make better fact based business decisions. To enhance financial literacy, it is key for leaders to plan for and understand outcomes in a strategic, operational and economic context. To create value now, organizations have to KNOW. MORE. NOW. Some people have termed these efforts as being the “CFO Whisperer”.

    His wide-ranging career has exposed him to the dynamics of various industries, from start-ups to global corporations. Importantly, his broad industry experience has helped him understand how the value chain of businesses can be best organized for success.  He has honed his skills in handling turnarounds and uplifting high-performing organizations.

    Much of Pat’s work centers on collaborations with Private Equity-owned companies, fulfilling both Buy-side and Sell-side roles. His academic foundation is a dual degree in Management/Marketing and Accounting from St. Joseph’s University.

    Pat’s vast industry experience spans sectors including Aerospace, Automotive, Banking, Business Services, Chemicals/Process Manufacturers, Commercial Services, and many more.

    Wondering how Pat can fit into your organization and provide value? Here are some of the roles he’s successfully filled in the past:

    • Merger and Acquisition Support for both buyers and sellers
    • Financial Management Leadership Support
    • Interim Leadership as CEO, COO, CFO
    • Financial Management Improvement
    • Transition Support
    • Turnaround Leadership
    • Business and Strategic planning
    • Start-up Support

    His work primarily revolves around uplifting financial management capabilities, aiding leaders to transform finance organizations into strategic capabilities, mentoring the next generation, and providing business intelligence.

    Pat McCormick is more than just a consultant. He is a strategic partner who is committed to leveraging his expertise to help businesses navigate challenging times and steer towards a path of sustainable growth and excellence.

    Contact information:

    Email              pjm@pmccventures.com

    Calendar:         calendly.com/pmccventures-pjm-4

  • Lessons from the past, assumptions and stances we need to unwind and stances we need to embrace  as we embark into an uncertain 2023 and beyond

    It has been a while since we have prepared and sent this letter, but we suspect we are not the only organization attempting to develop a sense of the “new normal” to best serve clients and customers. We wish you the very best for a developmental and prosperous 2023. Many of us enter 2023 in the midst of great uncertainty. But- we have the “goods to succeed” if we access them and pay attention. We have all taken in the choppy good [business]  news bad [business]  news cycle over the past several years.  As expected, governments’ spending to keep the economy afloat during the depths of COVID, accompanied with [should have been expected] physical supply chain imbalances and disruptions that caused flareups in the normally steady [ier] supply/demand equations and – of course, price increases and  the specter of inflation emerged.  Throw in the sad and immediate losses of the invasion of Ukraine, and then the longer-term impacts food safety, energy imbalances, and a real mess (technical term) emerged as we move into 2023. And it became a really big mess- against which all good business leaders had to plan and act to thrive. Despite the choppy news cycles, we have also experienced the steady sensationalism of the business and common press conflating the cause, effect and possible remedies presenting more disorientation and fear that certainly advances “viewership”, but hampers clear thinking, action, and the ability to motivate employees and others to gather resources and focus to deal with the main event-of working on their organizations and become overtaken by the side show! If that’s not enough, throw in that we were nearing the end of a long run of technological opportunities, really cheap money and young companies emerging and more seasoned companies struggling to keep up – but adding programs, projects etc. to embrace emerging opportunities.  Couple that with the fact that leaders of these businesses were young, smart ambitious, positive, and largely inexperienced in leading in environments where the “arrows were not pointing up”  These tech companies have begun to respond and the interpretations of their responses are co- mingled with:  “is there real fear of the future”, or “is this a correction to the exuberant innovation spirit and yet to be commercialized innovations of the last 5 years”?  Many of the actors are unwilling to say, but the business press continues to oversimplify what might be going on and cause additional doubt about our economic futures, and stymieing  organizations from clear thinking and action. At PMCC Ventures, our focus has always been on value creation- early, often, continuously, and fast.  We are all shaped by our experiences and ours is partly shaped by our work with  organizations  that had lost their way and the challenges they encountered, as well as by organizations that kept their eye on the prize, continuously adjusting and the things they were able to accomplish by increasing their value [and confidence] for markets and customers, owners, employees, stakeholders, and their overall ecosystem.  So, in this year’s letter we attempt to provide some context around our current conditions- and inspire confidence that we have experienced, weathered, and really succeeded in dealing with similar circumstances in the past.  But, we have come to realize that our focus and mantra to continuously improve the business of Your Business is not enough.   We are adding the lens that has developed from our work in helping organizations on both the buy side and sell side of transactions- and think that Business Leaders need to start running their business’s each and every day like they are for sale and will sell for strong prices and with great terms and conditions.  What this really means, is that organizations have to be increasingly discerning on what they  hear and read and how they incorporate that into their thinking-and have to look hard within their own operations, capabilities and capacity to effect positive value creating operations and results. We love to discuss and help organizations create value (and get a bit cranky when we see value creation opportunities fritted away). If you want to talk more about value creation give us a call or text  215.680.7331 or email: pat@pmccventures.com    Thank you for your support and friendship and best wishes to you and your organization for a value creating 2023 and beyond! Read on for more in depth thoughts We decided to delay sending this note until Ground Hog’s day- for a few reasons beyond wanting to know the “weather forecast” and a need to justify our proclivity to procrastinate Did you know it is Phil’s 60th birthday?  Also did you know that the Punxsutawney Phil (“P.Phil”) event has gone on for most of the past 137 years? Like many of us, Phil has experienced a lot and is hopefully relying on that experience and wisdom to make his prognostication- happy birthday to Phil. We were trying to gain as much perspective as possible to better understand the current situation we and our clients are experiencing. Over the past years, we have been bombarded with really challenging, table flipping situations, reporting of those situations that seemed only to focus on sensationalization, which then unfortunately resulted in obfuscation. Makes it tough to assess, think and strategize. As native [ fill in the blank] companies emerged, seasoned folks left the workforce etc., we now have a leadership class that has not had the learning [hardening?] of significantly working in business downturns. Similarly, since many of these folks “came of age” when the sky was the limit- they may have had a tendency to over invest, entertain decent ideas that could not commercialize at scale and be understandably  swamped with many different/similar/competing technologies [with no real standards to accompany them-and enable commercialization at scale]. But if you have been around long enough, you have seen that before- and hence why Phil is a good mascot for leading into 2023. 

    We are in the midst of it and have to weather this storm smartly- and overcome the “forecasts that are supposed to help”!

    We are interested in seeing whether or not conflicting economic headlines promoting hand wringing will continue.  Probably, like you we wearied of the competing side by side headlines:·

    • Rampant Growing inflation
    • Interest rates out of control
    • Housing prices are falling

    Or the other themes:

    • Consumer prices are growing up
    • Supply chains are knotted
    • What are [the] governments doing wrong- and why are they doing this to us?  Why won’t “they” fix it?
    It is scary that no one seems to reflect the tightly wound systemic nature of these problems, nor the cause/effect/[attempted] remedy cycle- and the call for a government intervention across multiple and global supply chains.  These are intricate challenges and simplistic headline [grabbing] only serves to confuse, prolong and exacerbate the challenges of the remedies. But, But But…. we also learned in our research that P. Phil has only been right about 40% of the time….  We have to become more discerning about what we hear, read think and apply to our thinking about our organizations.

    Paying serious and unilateral attention to prognosticators causes freezing!

        •  If you are almost as old as Phil… you have experienced this weather and been to this play before- you have experienced high interest rates, you have weathered them and have prospered – on a personal level. 

    On a business level, you have been to the play before as well-

    if you are near Phil’s age- you have seen a lot of different cycles, you have weathered them and have likely prospered.  You experienced the moves to make- and in many cases orchestrated them and were able to help your organization see its way through to a productive outcome.

    So, you know that these themes will not persist- but it is the time for every good businessperson to get back at the helm—and do what good business people do- Assess, Plan, Execute, Repeat…. Until you get it right and are navigating towards prosperity.  But for some context on how we might have gotten here- and for some courage to embrace the future smartly- remember these things:

     

    Many of us have been there- but- as we look back at our most recent situation, there is a challenge.  Many of the folks  in leadership positions today: swinging the baton, allocating the resources, making critical and mostly data and experience free decisions (through no real fault of their own- they simply did not have the data or the experience to overcome a lack of data) did not have the benefit of these perspectives.  And, the Advisory class of Investment bankers, fund leaders etc., mostly and similarly lacked that same experience.   

    So, as you look at your shadow and prognosticate about the future- consider these questions

    • Should we be surprised to find ourselves in this condition? What do you have to do to “unfreeze”
    • Why don’t leaders understand and act upon the systemic interdependencies in their businesses and plan to act upon them?
    • Why was the business press conflating causes, effects, and remedies- what impact does that have on your ability to motivate and mobilize your team?
    • What are you doing now to set up for maximum well-being and prosperity

    ·

    But these questions and these answers are not enough. The areal question for great business leaders is how do I get from here to where I want to be.  Conjure up the Yogi Berra quote for some inspiration:

     

    Don’t be fooled- this is hard work- and for many of us our initial instincts might be well intended:

     

    We live in a 130+ year old house so we are particularly guilty of this as a starter… And we commiserate with a lot of friends, colleagues and clients and realize just how this might be- but we are all faced with the common reality- we don’t have a choice but to deal with it!

     

    Startups and greenfields are frequently easier to deal with!  What do we need to consider to overcome the continued freezing suggested by P. Phil from Punxsutawney, PA?

    So- given what we have learned- what’s the best way to proceed to set up for success in 2023 and beyond? 

    • Prognosticators might not be right
    • Some leaders, despite a lack of experience, are fully committed and articulate about their point of view
    • and you as a business leader today- are charged with doing your job- which is to take the hand you are dealt and create the most value possible.
    Our suggestion is to take all of the info you can for balanced consideration and then stand up and take action with your team, for your situation, and your unique opportunity to create value.

    For the many that know me well, you know my mantra has been:  “Work on improving the business of Your Business”.

    Given the changes we are all experiencing, and the uncertainties we face- positive and negative, we continue to believe there is no time like the present to double down and continue to focus on improving the business of your business by sharpening thinking about how you create value through:

    • Focus
    • Strategy
    • Filling customer wants and needs
    • Filling employees wants and needs
    • Filling other key stakeholders wants and needs
    • Delivering returns
    • Simply becoming as good as you need to be to deliver on your vision and goals for your organization

     But in many instances, that does not seem to be enough guidance or an adequate lens to appropriately motivate management teams to address future prosperity. 

     

    For 40+ years we have worked helping companies in various stages of a deal process: Buy, Improve, Sell.  Over the past several years our work has morphed to another range of the deal process:

    1. Decide to sell
    2. Assess what am I selling and is that worth enough?
    3. How do I make it worth it?
    4. Take it to market
    5. Reap the benefits of a lot of hard and smart work.

    So-there  is more–  we are adding to our mantra: you have to run your business each and every day like you will sell it (at the best possible price and terms) tomorrow. 

    Simply- you have to put a lot of your spirit, smarts and will into your organization to thrive!

    As we size up businesses for purchase, and think about positioning for sale, these are the thoughts that are shaping our work, effort and thinking.  We hope you will find some value in these thoughts for your organization no matter what you are thinking:

    Reality check:

    • ·    How important do you believe these considerations are for your business?
    • How much time and effort have you spent working on these matters-
      • As a Leader to shape your thinking
      • With your teams to develop a shared understanding and focus
    • Do you think you are prepared to deliver the results you want?
      • If not, what are you willing to commit to get it done?

    We have spent a lot of time in the past years in various transactional roles- buying, selling, and fixing when folks actually bought something different than they thought they were buying, or the expected synergies did not pull through. 

    The dynamics of buyers really wanting to buy (FOMO and Needing to put money to work) and seller’s desire to cash out or take chips off of the table, and the speed with which these dynamics built to a crescendo, caused a lot of frenzy, so there will likely be a concussion blast of disappointment on the horizon. 

    But on the bright side- the reduction of the FOMO pressure will allow owners to take stock, make the necessary moves to create value- and wait until the moment is right for them.  am not sure whether it is age (we prefer the experience concept) or the times, but as we write this note this year- we are armed with more questions than prescriptions.  We hope that the questions provoke more thought, introspection, and beneficial outcomes than prescription.

    As we enter 2023, we think there are few certainties:

    • It will be a choppy year
    • Main St and Wall St economies probably won’t synch up (sending a lot of mixed signals-which are problematic if you don’t have a paradigm to assess them)
      • There are likely to be many Main St economies not all moving in same time and place
    • Inflation and Interest rates (one of the primary tools to combat inflation- so why all of the wringing of hands- which would you prefer?) will continue as uncomfortable bed fellows 
    • Employment levels and access to the appropriate folks to fill required roles will continue to be a challenge for a long time- so what are you going to do about that?
    • Cash flow-and the cost of funds, like the old days will be increasingly important
    • Extended supply chains will continue to evolve (see cost of funds challenge above re financials) creating uncertainty in systems that tend to work best in homogenous environments (do you remember when we spent a lot of time and a gazillion $ to make them the fastest, lowest cost efforts ever?)
    • Employees, Leaders, and Organizations will struggle with finding the right mix of work styles to deliver both for customers and employees
    • Aging workforce, people checking out, slowed immigration and changes in worker knowledge, skill, and experience necessary for success will continue to put pressure on getting the right people in place at the necessary time
    • The markets in which we operate will evolve, change, or wither. 
    •  Organizations in your value chain will deal with challenges  and opportunities at different times and paces (and will discuss with varying degrees of understanding and candor)- which will seem to amplify uncertainty—(but life cycles will govern, and we can better understand if we hang change and challenge onto a lifecycle model)
    We are clearly operating in a time of change- giving up and seeking new This list is obviously daunting- but abbreviated and will have to be modified to be completely relevant to your organization, however there are no real surprises in the list- and most have surfaced in some measure in the past for most organizations (and we coped, and we are still here).

    However, some listing like this is necessary to frame the future for which you are planning success.

    Reality check:

    • How much effort and quality time, have you spent preparing and assessing your list?
    • What are the most critical certainties/uncertainties for your organization?
      • Have you catalogued?
      • Have you weighted?
      • Have you considered them systemically?
    • Are you comfortable that all of the people in your organization responsible for the future and allocating resources
      • Have sufficient understanding?
      • Understand the ramifications for your business?
      • Have a shared and systemic understanding and appreciation for the conditions you encounter?
    • How prepared is your organization to plan and [change] operate in this environment?

    With all of the thinking about uncertainty and planning future, we can’t take our eye off of the ball today- the day job continues– we have to continuously create the resources today to enable us to compete tomorrow.  We have to Live To Play Another Day (LTPAD), so as you think of the future are you thinking about attitudes and capabilities for success? 

    • Are you thinking more about
      • the HOW you do something vs the WHY and the WHAT you are doing? 
      • Could a different WHO or WHERE provide a better result for you?
    • What are the hurdles slowing you down today– that will also slow you in the future if you don’t deal with them?
    • Do people on your teams have the necessary curiosity and inquisitiveness, to “get behind the transaction or event” to understand it- and process that insight for continued improvement?
    • Do people on your teams have adequate command of the business tools at their disposal
      • Do they demonstrate capability and competence- do they strive to use them more and more creatively?
    • Are you mired in data- or do you have the capability and sensibility to mine and mold data into information, insight, and foresight?– Or are you starving for meaningful data about your organization and supply chain?
    • Are you thinking more about
        • the HOW you do something vs the WHY and the WHAT you are doing? 
        • Could a different WHO or WHERE provide a better result for you?
    • What are the hurdles slowing you down today- that will also slow you in the future if you don’t deal with them
    • Do people on your teams have the necessary curiosity and inquisitiveness, to “get behind the transaction or event” to understand it- and process that insight for continued improvement?
    • Do people on your teams have adequate command of the business tools at their disposal
        • Do they demonstrate capability and competence- do they strive to use them more and more creatively?
    • Are you mired in data- or do you have the capability and sensibility to mine and mold data into information, insight, and foresight?–
    • Or are you starving for meaningful data about your organization and supply chain?
    • Are you having more conversations about transactional tools and process than data and information creating tools and processIt is scary that no one seems to reflect the tightly wound systemic nature of these problems, nor the cause/effect/[attempted] remedy cycle- and the call for a government intervention across multiple and global supply chains.  These are intricate challenges and simplistic headline [grabbing] only serves to confuse, prolong and exacerbate the challenges of the remedies.
    Please accept our best wishes for a healthy and terrific 2023 and beyond. And thank you for all of the learning you have helped me accomplish over the past 40+ years. The rewarding thing about this Beginning of Year Note is that we know most everyone that will receive it (and hopefully read it)- and are having fun handicapping the reactions! pjm@pmccventures.com

    text:  215.680.7331

  • This might be part of the [apparently] secret formula necessary to help you Improve the Business of your Business

    Active observation over the past several years suggest that curiosity seems to have dampened. Perhaps it is the fear of “doing deep dives” in situations that we fear might become uncomfortable. Perhaps it is remote working- or perhaps it is mentoring and leading that is not geared to the realities of our current workplaces.

    For whatever reason, we have to come to grips with this and really build this capacity in all sorts of organizations. Take a quick read of this, and spend more time assessing your own situation:

    https://www.fastcompany.com/90782370/why-we-should-embrace-radical-curiosity-and-learn-to-ask-better-questions?utm_source=newsletters&utm_medium=email&leadId=769432&mkt_tok=NjEwLUxFRS04NzIAAAGGl93cUD0tiBqiCILiqG9sDYBQJq_laztr0VQwMHYcfEw6nq0feW_S9-qdGDRIKqSuKeVVN69Yy-PqDFFQfqw8G8uY_YqoWhoPE6jcUA

  • It is a lot less of a gamble to run your business today like you are going to sell it tomorrow!

    PMCC Ventures has bee involved in buy or sell transactions for more than 40 years. Working on both sides of deals helps us to know more about “what the other side is thinking”.

    Today- there are a lot of good reasons to consider selling a company- whether you are a Private Equity Portfolio investor, or a long-term entrepreneur that has built a company the “old fashioned way:  Smarts, hard work and a bit of luck mixed in”.  And today, there are a lot of people interested in having you quickly get rolling in the process. 

    But we think it is better to first follow the earlier wisdom of Kenny Rogers- and check what condition your condition is in Listen here  before you follow his later advice and start playing your hand.

    We have recently been involved in two transactions- one where we were able to work with the seller to end up with a purchase price 1.7x the original offers, and another, where the sellers enjoyed 6x their original investment in about 5 years.  Neither were flashy or high tech- just companies whose services are in demand today. 

    We avoided the dreaded answer of: “Good point, we will have to get back to you on that”. Instead, we were mostly able to respond- “that’s an interesting way to look at it- let us show you how we look at that”.

    Our teams simply prepared hard and played well.  We worked with our clients to be well prepared for the “end” before we even started.  We followed the advice of: run the business today like you were going to sell it tomorrow [be really well prepared].  We anticipated questions, we analyzed data to develop and deliver our answers.  We were of the belief that the sum of the parts were much greater than the average– as some of the underlying businesses generated much more value [in the eyes of buyers] than other parts- and we strove to prove the case.

    Today sales opportunities abound- no matter the size of the company, but perennially it is wise to note that all deals are not created equal. This is the time to prepare for the most important sales call you will ever make.

    PMCC Ventures is happy to share our 40+ years of learning with you.  We are happy to help if you decide you want it.  Check here for some further thoughts. 

    If you want to chat, here is our contact information:

    pjm@pmccventures.com

    Schedule a call or meeting

  • Turn the challenge of C level exodus into an opportunity

    What are you thinking when you must replace a C- Level Executive?

    Most organizations grapple with replacing C level executives when one of the existing leaders decides to or is forced to leave.  Others, have the luxury of a bit more runway when they see either great new opportunities or significant challenges looming.  But the thinking around these three situations should likely be similar. 

    When a position is vacated, or a Leadership need arises, the functional requirements of the role  are usually pretty evident.  The subject matter expertise and specific “technical skills” for the role are also generally well understood.  The tricky part is deciding what “stance” you want a new leader to hold and what experiences would help create that stance and be good for your organization to access.  and experience are important but not the only set of considerations in choosing a path forward.  This note is about the six things you should consider as you paint in the shaping experiences you hope to find in a new C level Leader. To read more: https://pmccinteractive.com/wp-content/uploads/2022/05/20220510-c-level-exodus-turns-into-an-opportunity.pdf

  • Pat McCormick joins Urban Engineers Board of Directors

    I am honored to have the opportunity to serve the people and owners of Urban Engineers. Urban is an ESOP company so there is a lot of enthusiasm and team work evident in the business.

    I was impressed in our first Board event to hear the management team express how they treasure long term client relationships and the passion they have for dealing with complex situations in sound and innovative ways.

    To read more about Urban Engineers: https://urbanengineers.com/news/urban-appoints-patrick-mccormick-board-of-directors

  • PMCC Ventures Background

    PMCC Ventures background

    PMCC Ventures brings 40+ years of experience and capability to help clients improve the business of their business and add and sustain value.  Our services range from strategy to planning to operations and performance improvement.  All with a clear focus on creating and sustaining value

    PMCC Ventures was founded in 2006 with one specific goal:  Help our clients improve the business of their business resulting in added and sustained value.

    Given the economic conditions in 2023 and a solid reflection on a lot of recent experiences, PMCC Ventures has decided to re-emphasize its roots.  For several of the past years, we have been working with Business leaders and their finance teams to help solve the lament that “finance needs to be more strategic”.  That has been true for the past 25 or more years, and economic uncertainty and the overall deal environment, has brought that to the fore once more. 

    This time we are focusing on the middle market because the need appears greater and the opportunity for value creation is just so good.  We believe that the role of financial leaders is to help their companies see over hills and around corners while they are providing solid basic financial information.  But we believe solid financial information is just not enough to help organizations explore and execute extraordinary value creating changes.

    Here is what we bring to the table to help achieve that goal:

    • More than 40 years of diverse and deep industry and business process experience
    • Work across varied stages of development, ‘
    • The benefit of working with organizations in a range of performance from turnarounds, to middling growth to high growth and profits
    • Experience in all forms of transactions- buying, selling, rolling up/platforming and integration

    Broadly, our service areas include:

    • Strategy and Planning
    • Finance Transformation
    • Operations transformation
    • Business Intelligence- and Financial Planning and Analysis
    • Deal and Transaction Support
      • Buy
      • Sell 
      • Operations improvement
      • Financial Management Improvement
    • Turnaround Management
    • Business Coaching

    We are different:  We provide these services either as consultants and advisors or as Fractional Executive Leaders.  We choose to work with leadership teams to identify opportunities to improve and then design the practices and  processes to realize the goals- and where it makes sense to modify the tech stack to make it all happen more effectively and efficiently.

    To Contact us:

    Pjm@pmccventures.com

    To learn more: https://pmccinteractive.com/wp-content/uploads/2022/05/20220427-background-pmccv-6.pdf

  • The Disruptors and S-Curves

    Getting steeper, shorter, choppier, scarier? You decide. Your stance will help you think through how you want to address your situation.

    Take a read: https://www.notboring.co/p/who-disrupts-the-disrupters

  • Getting easier and more important to learn from the kids….

    Easter weekend is over. We are back at our desks- or other improvised work spaces. The kids were all here- including the new model that is just 6 months old. It was a great weekend to learn- It was a lot of fun to see all of “the kids” interact and talk about believe it or not business… It is so rewarding for Marie and I to have a glimpse into the “new economies” and the infrastructure and capabilities that are being developed to keep the new economy moving… Meghan- Fintech and African job and economic development…Dan- DTC underwear of all things… Puja start up DTC companies and Packy….the reformed financier and now business writer… And not to mention Marie who employs more “social technology” than can be imagined in the service of getting organizations to be way better and effective than they ever imagined.

    This morning, Packy published the “first year birthday” post for Not Boring- another glimpse into the mind, heart and soul of start up capitalistic sojourner…

    https://www.notboring.co/p/a-not-boring-adventure-one-year-in?token=eyJ1c2VyX2lkIjoyNDQyMDk5LCJwb3N0X2lkIjozNDc1NzAwOSwiXyI6ImZZeWFpIiwiaWF0IjoxNjE3NjI5Mzc1LCJleHAiOjE2MTc2MzI5NzUsImlzcyI6InB1Yi0xMDAyNSIsInN1YiI6In

    Take a read- I am so grateful for the reads, the conversations, the challenges ( to the sixtyish year old’s business thoughts)…..

  • Systems Thinking- When the going gets tough, go back to the basics

    As many know, there is an abundance of e-commerce data ranging from web site visits through sales and abandoned carts etc.  The data is arrayed over many different timeframes and it can be overwhelming to make sense of it and use it to shape generative decisions for growth. Because of some client work, with regard to sales growth- and all the levers you might push or pull to accomplish that, my focus turned in greater detail  to systems thinking and systems dynamics modeling as a way to reduce clutter and focus on the decisions and items that count. In other words, get back to the basics.

    AND

    I could not help but think that  systems thinking and systems dynamic modeling can add to our understanding about the progression of the Corona Virus and the impact it might have on us individually, our companies, the markets in which we compete etc.  As individuals we don’t have enough data to build a systems dynamic model, but thinking about what we read and hear with a systems thinking mindset, might help us make more sense of what is going on around us.

    I first encountered these concepts when reading Peter Senge’s book The Fifth Discipline.  I was lucky enough to participate in programs with some of the leaders in this field.  Since then, I have always been on high alert for  recognizing systems, articulating their performance and trying to understand why things happened the way they did- and moreover, trying to understand what alternative outcomes could be achieved if the system was “tuned” differently.  But- I moved away from detailed documentation and modeling- and now I will invest time to enhance my learning and focus my understanding.

    I have made a personal decision to turn as much of the downtime or extra time that has been freed up because of the pandemic into an investment, vs. just spending it on random things.  I am going to focus more effort to deepen my understanding of systems thinking over the next few weeks.

    Also- the quiet time might also provide and opportunity to think through your life or business in this way, so that you are well prepared to “bounce back with authority” when the smoke clears.

    We would love to hear about your personal investment and what you hope to achieve.

    If this is of interest to you, particularly with the corona virus disease state,  I am listing some resources below:

    MIT Systems Dynamics Introduction  https://www.youtube.com/watch?v=AnTwZVviXyY

    Intro to systems dynamics modeling  https://www.youtube.com/watch?v=IenySRdkRu8

    Classic systems archetypes from Pegasus and Dan Kim  https://thesystemsthinker.com/wp-content/uploads/2016/01/PG01E-System-Archetypes-at-a-Glance.pdf

    Introduction to a basic system systems dynamics modeling software product  https://kumu.io/stw/insight-maker

    Good luck.  Stay Safe.  Stay Well.

  • Four organization traits that enabled high performing efforts in 2019

    We have pledged to share insights that we think might be useful to our friends and clients businesses and organizations.  2019 provided a lot of learning experiences and we have identified four significant traits that we think helped to distinguish high performing efforts:

    • Information, Knowledge and Action leading to capturing and sustaining value
      • They have great business intelligence- have the right information and know a lot of context about their businesses and organizations (and their competitors) and act upon that to their advantage
      • They know what drives value and have keen insights about the ingredients to the value
        • Where do you make and lose money?
        • What is growing and lagging?
        • What the leading indicators suggest might happen?
        • What are the trends emerging that have not yet settled in?
      • They think and act systemically in their analysis and response
      • They develop and act on both enduring and flexible plans to capture and sustain that value
      • The whole team knows what drives value and embeds it in their thinking and actions
    • Get the homework and hard thinking done “up front” and act proactively more than reactively
      • Think through the risk and reward in their work
      • Explicitly bring facts to the table and decision making process
      • Do diligence and ask appropriately tough questions
      • Document necessary legal agreements and cover for the “downside”- willing to spend a few more days negotiating than suffering challenges for years to follow
      • Know that it is too costly to deal with the unexpected or negative outcomes later- so they do their best to get the hard thinking and work done upfront
    • They employ the Wine/Milk; Cheese/Bread Assessment Model  for the opportunities and challenges they face:

    • Build and rely on the Team:
      • Think hard about the skills and experiences they need on the team and relentlessly pursue the right people- and don’t satisfice
      • Provide frequent and meaningful developmental experiences for their people:
        • Explicit and accountable endeavors
        • Endeavors important to the success of the organization
        • Guaranteed to shape perspectives, broaden scope and deepen skills
      • And if things are not heading in the direction they hope- See above: Wine/Milk;   Cheese/Bread Assessment Model

    For more information refer to: https://pmccinteractive.com/2020/01/24/background-information-for-pat-mccormick/

  • The conversation about the role of the CFO- and where she adds the most value continues- but the bottom line is that Finance counts!

    Thirty some years ago, we began research on the role of the CFO and the impact of financial leadership on the performance of the enterprise.  After interviewing and reviewing more than 50 organizations and engaging thousands of CFO/Financial leaders in workshops around the world, we found that there were several determinants of success.

    Moreover, we found great frustration on the part of CFO’s wanting a seat at the “business management/Strategy table” and the rest of leadership questioning why they needed/should have that seat.  While that conversation continues, the accompanying link to the Visual Capitalist shows that significant progress has been made and that the conversation continues and that is a good thing.

    Enjoy the link:  https://www.visualcapitalist.com/future-of-the-cfo/

    Meanwhile, each day, we continue to prompt the conversation and help Clients create value by  improving the business of their business

  • PMCC Ventures Transaction Support Services

    PMCC Ventures been in business for over 12 years, having built on the prior 28 years’ experience – and doing what we have always done and love: Helping clients improve the business of their business.

    Clients have changed, industries have changed, the starting point and nature of the assignments have changed, but a few constants remain in our work with clients to help them improve the business of their business:

    • Run the business like they will be selling it tomorrow at the best possible price. Make smart moves that create or sustain value all of the time.
    • Know more about their markets, customers and operations and apply that knowledge each and every day. Have a strong sense of inquisitiveness guided by a passion for just doing it better.
    • Really know how you make money in your business and your industry. Stretch to know more and more each day about the systems and interactions that help you create value and take all steps necessary to support and develop those capabilities.
    • Make sure that decision-making is not only fact based, but that it recognizes systemic outcomes, and connects strategic, operational and economic factors.  Communicate and discuss key understandings about the business with your team so that all understand how to best create value in the business each and every day.

    We apply this thinking in all of our work for our clients.  It helps us focus and prioritize, and requires us to understand the system and interdependencies at play in each circumstance – and to not take anything for granted.

    Applying Our Process to Transactional Support

    As we look at the pattern of our work over the past several years- the one striking realization is that we are now employing this thinking in the more than 70% of our work that involves some sort of transaction.

    • Assisting sellers
      • Transaction Preparedness Assessments- quality of operations, strategy and results
      • Developing and implementing plans to enhance the value of the business
      • Develop and stress test business models
      • Business plan preparation
      • Sales strategies
      • Offering memorandum preparation along with road show support
      • Sales process assistance management
    • Assisting Buyers
      • Diligence
      • Deal structure formulation
      • Integration planning and integration support
      • Post-closing reviews and targeted analytical work
      • Ongoing operations support

    Cross industry and cross functional experiences applied in a strategic, operational and financial context are important to our clients

    We have found that working on both sides of a transaction helps us to better understand what is on the mind of the “other side”. As a result, we can anticipate many issues and challenges before they arise and deal with them “as a matter of course” in the process instead of them becoming hurdles to concluding a transaction.

    Our industry and process experiences obviously help us to do our work, but more importantly, our cross-industry and cross-functional experience helps us to better understand the fit and dynamics of each business and to foresee issues that might arise that could damage a transaction – before or after the sale.  We view these matters in the interrelated context of strategy, operations and economics.

    We work cooperatively and compatibly with all of the professionals to get the job done for our client in the most effective and efficient way possible.

    If you are interested in a good deal that has a great chance at creating value, we are very interested in talking with you.

    pjm@pmccventures.com

  • Changing strategies…. make sure to check the alignment

    We are in a period of uncertainty on many fronts….Technological, shifting go to market options and priorities, emerging and leap frogging competitors and opportunities, just to name a few.  Many are appropriately responding to the changes by revisiting goals and objectives, and their strategies to achieve them.  In these times it is important to remember to adjust business practices, processes and resources to support your chosen strategies to ensure sustainable success.  Read more:  Strategic alignment notes

  • Business challenges are not like wine and cheese….

    Over the past few months, I have had scores of discussions with people working in and providing services to Private Equity Firms.  The conversations have been interesting and focused on questioning and challenging the status quo.  I thought it would be fair and appropriate to summarize the themes of the conversations for your consideration.

    Business challenges are not like wine and cheese…. but more like bread and milk– they are common, but don’t get better with time…

    These are the most frequently discussed and vexing themes….

    1. The strike zone is expanding- Longer holds don’t generally seem to represent additional opportunity for incremental growth and development- but place extraordinary pressure for returns and maintaining expected IRR’s for investors… creating additional risk with little prospect for incremental reward
    2. Velocity on the sell side is emanating from A companies, while B’s sit and search for a way out…Plentiful debt and plentiful equity in search of the A companies, make this segment of the market hypercompetitive and Strategics, PE firms and lenders are in the quest to provide a value add- and make their green money even brighter and shinier
    3. Everyone has them, few like to acknowledge it. Every portfolio has a “bottom 50%”– those companies that are under achieving expectations, or underperforming on an absolute basis.  The surest way to make money is to not lose any.  But, the time energy and attention placed on the challenged companies, tends to be a trap that saps attention from the higher performing companies that likely have an opportunity to outperform
    4. Management teams have been built and curated to focus on growth and development and set up for the exit…. but most don’t have significant successful experience in dealing with types of challenges presented by the “bottom 50%”
    5. Quality information is elusive.  It is a challenge to sustain a focus on relevant, reliable and readily available information to effectively run the business.  This delays or impedes problem recognition and response- and in some cases does not promote confidence in the strategies and steps necessary to “get out from under”- at the very time confidence and resolve is critical to break the cycle and drive improvements