- Team Approach, defined as a sponsor’s capacity to take a highly collaborative and sincere approach to ensuring management buy-in, is one of PE-CXO’s Nine Dimensions of Governance Fit® that enables executive success.
- Evaluate a sponsor’s degree of hands-on involvement before beginning a role to secure alignment. There is no one-size-fits all approach to the correct degree of involvement.
- Both sponsors and executives must contribute to a successful partnership. Learn how to identify effective sponsors and how executives can better foster collaboration.
Our Top 50 Private Equity Firms for Executives of 2024 Report revealed that an overwhelming 91% of executives would not return to work for a sponsor who did not collaborate with management or utilize their expertise. A sponsor’s approach to engagement with management teams is integral to maximizing shared outcomes. But what qualities define a successful sponsor partnership with management?
Balancing Management Autonomy and Sponsor Support
One of the most common value detractors executives cited according to our Top 50 Report is “micromanagement,” with executives often noting that sponsors made decisions that management should own, thereby inhibiting their ability to effectively lead the business.
In successful sponsor-executive partnerships, management teams are empowered to make decisions and lead once they’ve earned the sponsor’s trust. However, there is no single correct degree of autonomy a management team should have. Sponsors vary widely in their levels of involvement, from hands-off to highly engaged. What’s too hands-on for one executive might be just what another needs to succeed.
This is why the diligence phase before accepting a role is so critical. Evaluate the sponsor’s level of involvement with questions like:
- How often and in what capacity does the sponsor engage with the management team? ...