Operations Due Diligence: An M&A Guide for Investors and Business

Operations Due Diligence: An M&A Guide for Investors and Business

by James F. Grebey
Released October 2011
Publisher(s): McGraw-Hill
ISBN: 9780071778510

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Book description

The missing link to determining a company’s real value

Most people at the M&A table know how to carry out financial and legal due diligence. Only the accomplished investors come prepared with an in-depth understanding of the complete due diligence process. Operations Due Diligence is a game-changing guide for investors who need a fully accurate determination on the sustainability of a business.

Written by a hands-on operations executive who has successfully implemented process improvement programs at large and small businesses, this practical guidebook sets itself apart by providing a step-by-step strategy for analyzing the toughest area of a business to assess: its operations.

Unlike financial and legal due diligence, there were no principles such as law and accounting to guide operations due diligence—until now. This turnkey approach, based on a pragmatic series of almost 400 questions, helps you accurately assess the infrastructures of a business’s customer satisfaction, production, information management, sales and marketing, organization, and personnel, as well as its finances and legal operations. For managers and business owners looking to improve the sustainability of their business, this guided inquiry serves as a thorough operations checklist to next-level performance.

Whether you are an investor trying to capture a new opportunity with minimal risk or an executive struggling to improve your business, Operations Due Diligence gives you a distinct advantage by:

  • Going a step further than most books and illustrating how to analyze your discoveries
  • Using historic examples to make the lessons both understandable and memorable
  • Clearly explaining how and why each sector is an important indicator of the long-term sustainability of a business
  • Conveniently locating infrastructure summary questions at the end of chapters for quick reference
  • Providing a document checklist so nothing gets overlooked at the negotiating table

The highest-valued companies and their investors know that producing the best products and services isn’t enough. Survival depends on continually improving infrastructure through Operations Due Diligence.

Table of contents

  1. Title Page
  2. Copyright Page
  3. Dedication
  4. Contents
  5. Preface
  6. Acknowledgments
  7. Part One: Planning Your Assessment
    1. Chapter 1 Due Diligence
      1. What Is Due Diligence?
      2. Self-Assessment as a Management Tool
      3. How Do You Score the Assessment Questions?
      4. The BS Quotient
    2. Chapter 2 The Due Diligence Process
      1. Planning for Discovery
      2. Nondisclosure Agreements
      3. On-Site Assessments
      4. Virtual Deal Rooms
      5. Assessment Reports
    3. Chapter 3 Infrastructure Assessment Areas
      1. Operations Infrastructure Areas
      2. Operations Transaction Points
  8. Part Two: Exploring In Depth
    1. Chapter 4 Assessment of the Customer Satisfaction Infrastructure
      1. Customer Satisfaction as a Competitive Discriminator
      2. Customer Satisfaction Metrics
      3. Human Factors Engineering
      4. Product Specifications
      5. Evolutionary Development
      6. Product Testing
      7. Product Support
      8. Product Training
      9. Summary of the Customer Satisfaction Infrastructure Questions
    2. Chapter 5 Assessment of the Production Infrastructure
      1. Product Development and Production
      2. Product Life Cycle
      3. Product Development and Production Risks
      4. Third-Party Products
      5. Summary of the Production Infrastructure Questions
    3. Chapter 6 Assessment of the Information Management Infrastructure
      1. Information Management System Design
      2. Information Security
      3. Information Management Network Usage Policy
      4. Baseline Control
      5. Software Tool Licenses
      6. Development and Production Tools
      7. Disaster Recovery and Business Continuity
      8. Communications Systems
      9. Summary of the Information Management Infrastructure Questions
    4. Chapter 7 Assessment of the Sales and Marketing Infrastructure
      1. Marketing
      2. Market Awareness
      3. Contact Management System
      4. Market Analysis
      5. Strategic Planning
      6. Product Management
      7. Sales
      8. Summary of the Sales and Marketing Infrastructure Questions
    5. Chapter 8 Assessment of the Organizational Infrastructure
      1. Command and Control Structure
      2. Corporate Culture
      3. Virtual Environments
      4. Ethics
      5. Physical Safety and Security
      6. Summary of the Organizational Infrastructure Questions
    6. Chapter 9 Assessment of the Personnel Infrastructure
      1. Employee Benefits
      2. Employee Compensation
      3. The Business-Employee Relationship
      4. Fair Employment Practices
      5. Hiring, Firing, and Everything in Between
      6. Employee Value and Quality
      7. Job Placement
      8. The Hero Employee
      9. Employee Motivation
      10. Employee Stability
      11. Employee Training
      12. Summary of the Personnel Infrastructure Questions
    7. Chapter 10 Assessment of the Financial Infrastructure
      1. Financial Authority and Responsibility
      2. Operations Linkages to the P&L, Balance Sheet, and Cash Flow Reports
      3. Program or Project Management
      4. Operations Reviews
      5. Labor Rate Calculations
      6. Product Warrantees and Guarantees
      7. Prescheduled Growth
      8. Employee Ownership and Options
      9. Banking
      10. Summary of the Financial Infrastructure Questions
    8. Chapter 11 Assessment of the Legal Infrastructure
      1. Contracts, Agreements, and Other Binding Documents
      2. Legal Signature Authority
      3. Government Contracts
      4. Compliance
      5. Intellectual Property
      6. Insurance
      7. Document Retention Policy
      8. Privacy Protection
      9. Summary of the Legal Infrastructure Questions
    9. Chapter 12 Assessment of the Institutionalized Processes
      1. Summary of the Institutionalized Processes Questions
  9. Appendix: Review Documents To Be Collected
  10. Index
  11. About the Author

Product information

  • Title: Operations Due Diligence: An M&A Guide for Investors and Business
  • Author(s): James F. Grebey
  • Release date: October 2011
  • Publisher(s): McGraw-Hill
  • ISBN: 9780071778510