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Idon’t think the majority of PE firms focus on ROI from in- novation. However, with one of our mid-market strategic
clients, we’ve deployed Lean Product Development (LPD) at
each of its manufacturing portfolio companies over five years.
I typically engage with each firm over a six-month period and
part ways when the team is clear they will get better returns on
their R&D investment.
During a review of that five-year period for our client, I
saw proof that each portfolio company improved its organic
growth, and some even reversed market-share decline.
One company improved its project results in the first year
of deployment—the value of the NPD portfolio increased
more than 50 percent. It maintained those results while decreasing R&D investment, eliminating redundancies across
its three design centers.
Our client recently exited the portfolio with positive out-
comes. LPD played an important role in the confidential in-
formation memorandum, giving the new owners confidence
in the health of their investment.
HOW DOES A PRIVATE EQUITY FIRM TRACK
RETURN ON INVESTMENT IN INNOVATION?
Brenda Reichelderfer is a senior vice president and managing director at TriVista, an operations consulting firm focused on middle-market companies.
She has more than 30 years of experience in general
management, engineering and operations. In addition to her
extensive P&L background, Reichelderfer gained operational
expertise as plant manager, vice president of operations,
director of engineering and chief technology officer.
BRENDA REICHELDERFER // Senior Vice President and Managing Director, TriVista
A QUALIFIED OPINION