President, LynnCo Supply Chains Solutions
Every month, we will feature an active member of the ACG New York community in a brief interview. Reflecting industry insight and personal perspective, this feature will introduce industry leaders and offer advice on the tools you need to succeed in the ever-changing middle market.
1. Quick basics - role / firm / focus / how long have you been an ACG member?
For the past 17 years, I have presided as President of LynnCo Supply Chain Solutions helping firms turn supply chain into an immediate lever for growth. I have been a member of ACG for the past three years and our firm has been a platinum sponsor for the last two years.
2. What do you think are the biggest obstacles in the middle market today?
As we all know, the market is tight with pressures to put money to work in a highly competitive market. This has put significant emphasis on the need for private equity firms to differentiate themselves, their sourcing approaches, and their value creation strategies. Most specifically, we are seeing a shift in private equity focus on value creation strategies that drive deep operational excellence to boost growth and multiples. What could once be accomplished through financial engineering is no longer enough to achieve desired return on investment.
Progressive firms today realize that they have to architect for growth in order to free up cash and drive up EBITDA. This requires a bit of a paradigm shift that involves firms to go beyond market growth strategies and executive talent alignment and dig deep into the operating mechanics of organizations in order to positively impact the bottom line. With supply chain at the foundation of every organization, it is quickly becoming one of the most immediate levers to drive value.
3. How has ACG helped you in your career?
ACG is a tight gathering of astute professionals that have welcomed LynnCo and become the most beneficial networking community of my career. I have been reminded that people do business with people, not necessarily as a result of a sales pitch, which aligns well with LynnCo's long-standing "seek to serve" culture. Today, through the ACG network, many of which I am proud to also call friends, LynnCo is fast becoming a marquee brand that private equity turns to for supply chain transformation and digitization.
4. Can you tell us about your greatest success story/ proudest achievement?
LynnCo has been successfully optimizing supply chains for small to mid-size companies for the past 20 years. Growing through traditional business development methods, our clients are typically emerging in their markets with a recognition that supply chain transformation is at the heart of their growth trajectory but not an organizational competency.
Five years ago, more than 80% of LynnCo's client base had been purchased by private equity. Having seen the results of our work within their newest acquisitions, many of these private equity firms began calling upon LynnCo to address supply chain challenges in other portfolio companies. This provided a unique opportunity for LynnCo to serve both private equity and the firms they acquire, consulting as trusted advisors and executing the strategies we recommend. At the same time, LynnCo's growth accelerated through personal networks and referrals rather than traditional sales methods.
The intersection of these two opportunities spurred a bold move to dismantle LynnCo's traditional sales organization while also planning to double our growth rate by singularly leveraging personal relationships and applying our supply chain expertise within the private equity sector. LynnCo's executives are now entrenched in communities, like ACG, who understand the importance and value of supply chain and strong partnerships. While many felt it a risky growth strategy, today, LynnCo is well known for its thought-leadership and deep supply chain competency within the private equity market and we have sustained accelerated growth as planned without a traditional business development organization.
5. What changes do you foresee in the middle market in the next 3-5 years?
Competitive pressures in the private equity market will only continue to escalate. Sourcing strategies are impaired as a result increasing tariffs and global regulation. E-commerce is forcing companies to meet growing consumer demands and will continue its economic disruption with the recent FAA approvals of drone distribution. Profits will continue to diminish for those companies not seeking and achieving high operational excellence. It's not a doom and gloom outlook but instead an opportunity to re-tune value creation strategies to mitigate risk and capitalize on these forces. Prioritizing supply chain as an immediate growth lever is one of the key imperatives of the value creation strategy now and into the future. Focusing on transformative and sustainable supply chain strategies easily yields 20x its cost year-over-year and will be one of the differentiating keys to success for private equity in the future.