Turning boardroom tension into a structured conversation — with operational insight and a clear path forward.
Summary
A high-growth portfolio company, backed by a specialist lender, had scaled quickly but now faced tough decisions it wasn’t equipped to make. Leadership transitions, expansion fatigue, and a widening performance gap had stalled momentum. NorthCo was commissioned to produce an independent report designed, first, to facilitate a focused board discussion and, second, to provide management with a clear roadmap for stabilising operations, challenging cost assumptions, and leading the business through the realities of restructuring.
Context
A specialist lender engaged NorthCo to conduct an operational review of one of their portfolio companies. The business had grown rapidly off the back of strong demand for a sensitive, medically-related product. But despite headline revenue remaining strong, profitability was declining. Operational costs were rising, delivery was inconsistent, and senior management pay had increased without corresponding performance.
Leadership was in transition, international expansion was draining resources, and the business had lost its grip on operational discipline. Our independent report, commissioned by Credit, was intended as a catalyst for constructive board discussion and to shape the next phase of the company’s recovery plan. It needed to be pragmatic, commercially grounded, and capable of supporting decisive action.
Importantly, the report also gave the portfolio team a credible platform to engage with management. Previous attempts to raise concerns had been discounted by the executive team, who (rightly) sensed that the portfolio team didn’t have the operational depth to push the point. Our findings gave the board the ability to ask informed, challenging questions without appearing adversarial — using the report as a shared reference point, not a confrontation. It turned a potentially difficult conversation into a structured, fact-based discussion.
Many portfolio companies encounter similar challenges — especially when management teams have not yet led a business through the more difficult phases of the cycle. Their experience often lies in scaling, not stabilising. Rather than wait for failure or replace the team altogether, the lender made a wise decision in commissioning this report early. It allowed them to step in constructively, support the board with clarity, and give management a chance to address the issues while the business still had options.
Our remit was to produce an independent operational report to support the board and executive team with practical, evidence-based recommendations they could act on. We were not engaged to lead the execution of those changes.
Our Approach
We conducted a structured operational review focused on four critical areas:
- Operational Effectiveness: Are systems, workflows, and ways of working aligned with strategic goals?
- Cost Structure: Where is money being wasted? How can we reduce cost without undermining momentum?
- Leadership: Do the current leaders have the bandwidth, support, and experience to deliver?
- Market Viability: Can the business support its international ambitions while stabilising the core?
How We Did It
Financial and Operational Analysis
- Reviewed EBITDA trends, cost base composition, and cash flow pressure points
- Audited the bespoke operating system to assess its value vs complexity
- Mapped internal workflows to identify accountability gaps and inefficiencies
Stakeholder Engagement
- Ran one-to-one interviews and working sessions with the Chair, CEO, COO, and CFO
- Facilitated open conversations about leadership confidence, organisational clarity, and role pressure
- Engaged operational and commercial teams to surface cultural barriers and hidden issues
Leadership and Pay Assessment
- Benchmarked executive pay against market comparators and linked this to performance outcomes
- Assessed whether retention strategies were delivering value or simply entrenching the status quo
Strategic Focus and Expansion Risk Review
- Analysed the cost and commercial return of expansion into Spain
- Tested leadership bandwidth and readiness for simultaneous system development and market growth
- Evaluated return on discretionary spend and alignment with business objectives
What We Found
The business had experienced a period of rapid growth, driven by high market demand for a highly sensitive, medical-related product. In stable conditions, the team were well-regarded and had strong relationships with the lender. They handled business-as-usual operations competently and had scaled quickly to meet demand. But the scale of expansion had outpaced their experience. When performance dipped and cost control became essential, the leadership team lacked the tools and experience needed to navigate tough decisions, reset spend, or restructure at the depth required to shift performance.
- Operational overload: Too many big initiatives running at once – system builds, geographic expansion, leadership transition – had fragmented focus
- Leadership strain: Both CEO and COO were new in role and under-supported, with limited PE experience
- Cost escalation: £1.9m of overspend identified, largely in management salaries and non-essential spend
- Remote working drift: The lack of a physical hub was weakening cohesion, reducing accountability, and slowing delivery
- Market overreach: The Spanish expansion was underperforming. Leadership lacked the local oversight and experience to make it stick
What We Recommended
Operational Reset
- Re-establish a central office to create structure, rhythm, and cohesion
- Simplify Spanish operations and manage the market from the UK until foundations were stronger
Cost Rationalisation
- Implement zero-based budgeting with clear controls on discretionary spend
- Realign senior pay and incentives with performance outcomes and value creation goals
Leadership Strengthening
- Appoint a hands-on Financial Controller or FP&A lead to support the under pressure CFO
- Encourage the Chair to step into a more active, executive-style role during the stabilisation period
Market Focus
- Prioritise the UK market – stabilise what works before pursuing further international growth
Outcome
We delivered a detailed operational review that laid out a clear path to restore commercial control. The report gave the business:
- A pragmatic roadmap to reduce cost and complexity
- Clarity on leadership gaps and short-term support strategies
- Defined priorities to steady the business and rebuild trust internally
It was designed to support focused board dialogue and to equip the executive team with a clear, actionable plan they could own and implement.
A Common Challenge for Growing Businesses
Many businesses are now facing a difficult but necessary adjustment. After a period of investing in growth, shifting market conditions are forcing a rethink. The challenge is not just cutting cost – it’s knowing what to keep. The risk is that valuable initiatives, hard-won capabilities, or future-facing investments are lost in the rush to right-size.
This is where an independent operational review brings clarity. It helps leadership and funders separate what’s essential from what’s expendable, and restructure with confidence – not guesswork.
What This Shows
This was a business full of potential, but it had become overloaded, misaligned, and overly complex. Our role was to bring calm, clarity, and control back into the system.
At NorthCo, we specialise in helping leadership teams and funders stabilise underperformance and chart a route forward. If your business is ambitious but losing traction, we can help you refocus energy where it matters most.
Right-Sizing Without Losing the Good
Growth often leaves a legacy – expanded teams, increased spending, and complexity that quietly builds up. Now, with trading conditions tightening, many leadership teams are being asked to right-size – without derailing the business.
At NorthCo, we help you cut the noise, preserve the good decisions, and reshape the business around what matters most.
👉 Talk to us about operational clarity
