Adjacency Focus: Financial Services Firm Uses Strategy to Focus

The Challenge: This Fortune 500 client had delivered above-industry growth in financial services over the past several years, primarily via acquisition and also through new product introduction.  Unfortunately, there was little synergy with existing business to be extracted with these new offerings.  Worse, the organic growth rates of these new businesses were well below our client’s targeted growth.  So, while each project helped to close a current year top-line gap, because of its inherent slow growth rate, each acquisition also effectively increased the gap that had to be closed the following year.

The Project: The client recognized the “doom loop” created by their current business development approach, and engaged Case Strategy to redesign that process.  Through examining past deal due diligence and results, surfacing benchmark deal-making practices among other more successful companies, and discussion with client leadership, we recommended several changes to how projects were identified, resourced, screened, and integrated.

Results: Following the project’s completion our client found it was doing fewer deals, primarily because of the new emphasis on strategic advantage.  In the past, fewer than 20% of their completed projects yielded the budgeted cost savings.  Now 90% of the projects were meeting their anticipated returns, and those were on average higher than they had been in the past.  As a result, the new businesses were growing at above-target growth rates after year one, helping to close – rather than exacerbate, as they had before – the top-line performance gap.