Ann Iveson's Blog - Archive (November 2011) - London Business School

Ann Iveson's Blog - Archive (November 2011)

COLLER PRIZE EVENING | LESSONS FROM TIM PARKER

07 November 2011 by Ann Iveson

Masters and PhD Prize Winners 2011 announced at Annual Coller Prize Evening
Tim Parker's learnings from an impressive career

Now in its 6th year, last Wednesday was the Annual Coller Prize for the best case study and management report completed by Masters students at London Business School in the field of venture capital or private equity. In 2010 we also introduced a new category - the PhD prize that is open to all PhD students at any academic institution focussing on research theses in this sphere.

Congratulations to all the winners and runners up. You can find out more about them and their work on our website.

However I want to devote this blog more to the introduction given by Tim Parker an alumnus of the School and now an Industrial Partner at CVC Capital Partners. Although not a hagiography, it nevertheless provided some interesting and useful insights to the essential elements or lessons for running a successful business and why these might more readily exist within private equity owned firms.

Having witnessed, changed and imposed governance at a variety of organisations including Plcs, family businesses and pe owned firms these are his take aways from his impressive career.

Failure - To fail is good for a career, especially if it occurs early and is not too spectacular.
Managing People - For success it is critical to develop sound judgement about people - which to motivate and promote and which to remove. The role of the CEO is to pick and trust the right people. He avoids so named "political" people; those that will put their interest and agenda above that of the company or main mission.
Delegating Power - real delegation creates real power to leverage (not in the financial sense) the organsiation to develop a collective responsibilty. This is different from a blurred sense of shared responsibility. It means encouraging disagreement and promoting a direct feedback to the CEO on problems and disagreements.
Incentives - They can make the same people have different behaviours. Whilst at least in the financial sector incentives are a bad word, he showed that structured correctly and based on realised results not just valuations they can make those potential recipients to ask tougher, more demanding questions of their and others performance. Most importantly they can make those same same people move at a faster pace to correct and improve imediments to performance.
Tempo - The speed of decision making is imperative. Opportunities are often lost to procrastination, analysis paralysis or just down right laziness. With volatility a seemingly constant, the ability to make a decision is key. The art is to know when you have enough of the right information. It is, he said, better to make the wrong decision than no decision - wrong decisions can usually be reversed.
Execution and Knowledge - Great execution is everything and the catalyst for this is specific indepth knowledge to anticipate and avoid pitfalls.

What about the benefit of the MBA at London Business School - why is this not included above? Definitely it was a factor (although it was MSc at that time) as it transitioned him into general management from a 'career' in the Treasury. It also underlined and engendered a more competitive ambience as opposed to his, self confessed, more relaxed undergraduate years.

Tim closed his candid and engaging talk on a more serious and poignant note; after a comment on succession planning at pe firms he made an observation on the increasing pressures facing everyone running a business today, explicitly that 'the cake' is no longer growing. Although open to interpretation I saw this as implying a flaw in or a warning on capitalism as the mechanism for empowering wealth creation. Whilst there is an increasing return on intellectual capital the middle classes are not just being squeezed but evacuated he stated.

So may be he rightly earned his albeit ersatz tltle "Prince of Darkness" and we should tune out this blog to Elgar's Nimrod, a sombre melody, the type which Tim had told us is used by the media to signify, as in some theatrical ensemble, "the bad guy". But there again honest should not be confused with bad just because you don't like the message!

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About me

Ann Iveson

BSc (Econ, LSE), MSc Sloan Fellow (London Business School); ACA

Senior Advisor

Ann was Executive Director at the Coller Institute of Private Equity for the past two years (2008-2009) playing a key role in defining and implementing many of the strategic initiatives and projects. She has extensive banking experience within the fields of credit, fixed income sales, derivatives and capital markets. She headed credit at CSFB and European Corporate Origination at BNP Paribas. She qualified as a Chartered Accountant with PriceWaterhouse Coopers and holds a BSc (Econ) from LSE and is a London Business School Sloan Fellow. Ann is a member of the Advisory Board.

London Business School Coller Institute of Private Equity