Introduction: In my role as Interim M&A and Sustainability Director for a family-owned company listed on the Milan Stock Exchange, operating in the industrial goods sector, I faced a unique set of challenges. The company, managed by the first generation of the founder, had a strong presence in the Italian and European markets, catering mainly to B2B clients in well-known sectors and industries. Despite its successful track record, the company’s growth rate was relatively slow, aligning with its tradition and conservative approach.
Challenges
- Balancing Tradition and Market Competition: The primary challenge was to strike a delicate balance between respecting the company’s rich tradition and heritage while enabling it to stay competitive in a rapidly evolving market. As the company ventured into mergers and acquisitions (M&A) to expand its horizons, I recognized the importance of adopting a more strategic and forward-thinking approach. Instead of merely pursuing opportunistic deals, I proposed a methodology that aligned with the company’s growth strategy, focusing on minimizing risks and accelerating growth.
- Enhancing Sustainability Efforts: While the company had an impressive narrative around sustainability, it lacked tangible and measurable initiatives. With the market increasingly demanding eco-conscious practices, it was imperative to transform the existing sustainability narrative into concrete actions. The goal was not only to retain existing clients but also to attract new environmentally conscious customers, thereby bolstering revenues and ensuring long-term success.
Approach: To address these challenges effectively, I devised a comprehensive plan that encompassed both M&A activities and sustainability initiatives.
Action
M&A Approach: Rather than adopting a short-term and opportunistic approach to M&A, I emphasized a long-term vision that aligned with the company’s growth trajectory. By meticulously evaluating potential targets, we focused on acquiring businesses that not only complemented our existing portfolio but also offered strategic value in terms of reducing risks and accelerating growth. This approach allowed the company to expand its product offerings and geographical reach, enhancing its competitiveness in the market.
Sustainability Strategy: To revamp the company’s sustainability efforts, I initiated a thorough assessment of its current practices and identified areas where tangible improvements could be made. Collaborating with various departments, we developed measurable sustainability goals and implemented eco-friendly initiatives across the organization. By showcasing the company’s commitment to sustainability through transparent reporting, we aimed to build stronger relationships with clients who prioritized environmentally responsible partners.
Results
In pursuit of our M&A objectives, we diligently identified a couple of compelling targets that perfectly aligned with our meticulously planned strategy. The company initiated the process to acquire them, and we subsequently focused on seamlessly integrating them into our existing operations. Our overarching objective was to fortify the company’s market position, reduce risks, and amplify its growth prospects.
A paramount aspect of our endeavors involved crafting a strategic sustainability plan, comprising a series of tangible projects aimed at reducing and mitigating the company’s environmental impact. Emphasizing our unwavering commitment to eco-conscious practices, we sought to meet the increasingly demanding market expectations regarding sustainability.
As part of our sustainability initiative, we achieved a milestone in the company’s history by producing its first-ever comprehensive Sustainability Report. This report offered a transparent account of our sustainability efforts, highlighting progress, goals, and areas for improvement. It served not only as a testament to our dedication to sustainability but also as a tool to engage with stakeholders, fostering trust and reinforcing our commitment to responsible business practices.
Conclusion
Throughout the 12-month tenure as Interim M&A and Sustainability Director, our team successfully navigated the challenges posed by the evolving market dynamics. By strategically approaching M&A activities and integrating sustainability into the core of the company’s operations, we not only mitigated risks but also paved the way for accelerated growth and greater client retention. Embracing tradition while fostering innovation and sustainability allowed the company to fortify its position as an industry leader, both locally and in the broader Worldwide market.
Text by Massimo Getto, the Interim Manager who led the project.
