How do you monitor and evaluate the performance of a restructured firm after the deal is closed?

1 Set clear objectives and metrics

The first step is to define the objectives and metrics that you want to use to measure the success of the restructuring. These should be aligned with the rationale and vision of the deal, as well as the expectations and interests of the stakeholders. For example, you may want to track the revenue growth, profitability, market share, customer satisfaction, employee engagement, or debt reduction of the restructured firm. You should also establish the baseline and target values for each metric, as well as the time frame and frequency of measurement.

2 Collect and analyze data

The second step is to collect and analyze the data that corresponds to the metrics that you have defined. You can use various sources and methods to gather the data, such as financial statements, operational reports, surveys, interviews, or external benchmarks. You should also use appropriate tools and techniques to analyze the data, such as dashboards, ratios, trends, variance analysis, or statistical methods. You should aim to produce clear and concise reports that highlight the key findings and insights from the data.

3 Compare and communicate results

The third step is to compare and communicate the results of the data analysis with the objectives and metrics that you have set. You should compare the actual performance of the restructured firm with the baseline and target values, as well as with the industry standards and best practices. You should also communicate the results to the relevant stakeholders, such as the board, management, investors, creditors, employees, or customers. You should use effective communication channels and formats, such as presentations, newsletters, webinars, or meetings. You should also provide feedback and recognition to the people who contributed to the performance.

4 Identify and address gaps and issues

The fourth step is to identify and address any gaps or issues that may arise from the comparison and communication of the results. You should analyze the root causes and impacts of the gaps or issues, such as operational inefficiencies, financial difficulties, customer complaints, employee turnover, or regulatory violations. You should also develop and implement action plans to resolve the gaps or issues, such as process improvements, cost reductions, product innovations, training programs, or compliance measures. You should also monitor and evaluate the effectiveness of the action plans.

5 Adjust and update objectives and metrics

The fifth step is to adjust and update the objectives and metrics that you have set for the restructured firm. You should review the objectives and metrics periodically and make any necessary changes based on the feedback, results, action plans, or changes in the internal or external environment. You should also communicate the changes to the stakeholders and ensure that they are aligned with the vision and strategy of the restructured firm.

6 Use equity warrants and debt renegotiation

The sixth step is to use equity warrants and debt renegotiation as tools to monitor and evaluate the performance of a restructured firm. Equity warrants are options that give the holders the right to buy shares of the restructured firm at a predetermined price and date. They are often issued to creditors or investors as part of the restructuring deal to provide them with an incentive and a reward for supporting the firm. Debt renegotiation is the process of modifying the terms and conditions of the existing debt of the restructured firm, such as interest rate, maturity, or covenants. It is often used to reduce the debt burden and improve the cash flow of the firm. Both equity warrants and debt renegotiation can be linked to the performance of the restructured firm, such as revenue, earnings, or market value. This can help to align the interests of the stakeholders and motivate the firm to achieve its objectives and metrics.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?