Ankur Agarwal - Enterprise Technology for Private Equity

ENTERPRISE TECHNOLOGY FOR PRIVATE EQUITY

How to plan, design and execute a business transformation programme using strategic IT solutions

Ankur Agarwal

Published in August 2013 by

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2013 PEI

ISBN 978-1-908-783-22-6

eISBN 978-1-908-783-45-5

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Figures and tables

Figures

Figure 9.2: Sample transition architecture from an applications perspective

Tables

About the author

Ankur Agarwal has worked in the technology sector for nearly 14 years and is currently an independent consultant. He focuses on offering consultancy to private equity firms on IT architecture and design, technology evaluation, technology start-ups and building high scalable solutions.

Previously, Ankur was the enterprise architect with Actis, a private equity firm with a focus on emerging markets, for two years where he was responsible for the technology arm of all the business systems of the firm. Prior to this, Ankur was at Sapient Corporation, a consulting company providing business, marketing and technology services to clients, for ten years and worked as a lead programme architect on several large engagements for clients.

Ankur has employed his leadership skills and technology expertise to define, design and implement many large and complex business solutions internationally and across many industry sectors including insurance, travel, media and telecoms as well private equity. During his career he has worked with numerous multinational organisations including Lloyds of London, Hilton Hotels, General Motors, Avis, National City Mortgage, News International, COLT and O2.

Ankur has a bachelors degree in Electronics and Communication Engineering from Birla Institute of Technology in India and is also a TOGAF 9 certified enterprise architecture practitioner.

Introduction

The private equity industry is facing many new pressures and challenges, which are rapidly changing the business environment in which fund management firms operate. Investors in particular are more demanding of firms both before and after committing to funds, they are conducting closer due diligence inspections of both front and back office functions, they seek direct and regular access to senior managers of firms and they expect firms to report data more frequently and with greater granularity. Factor in also the raft of new regulations the Alternative Investment Fund Managers Directive (AIFMD) in Europe, the Dodd-Frank Act in the United States are just two examples which are placing firms under an unprecedented level of scrutiny from authorities such as the US Securities and Exchange Commission (SEC).

Private equity firms must be ready to respond appropriately to these pressures and be prepared to review and change their established business processes, operations and functions. Is the business streamlined enough? Is the flow of information between stakeholders, both internal and external, effective? How can we improve the business and take it forward? And what tools are required to enable the business to respond effectively to a rapidly evolving global marketplace? To address such questions, it is critical to have a clear vision for the future direction of the business and to develop a continuous process for translating that vision into actual processes and models that are effective, efficient, agile and durable yet adaptable to changes over the short and long term. And technology has a vital role to play in this.

This publication offers a practical roadmap for planning, designing and executing a programme of business transformation using strategic technology solutions and serves as a useful resource for anyone in private equity firms tasked with implementing changes or making key strategic decisions at any stage of the transformation programme. It provides guidance on creating detailed architecture plans for transformation that define both the existing structure of an enterprise and the desired end state with the numerous phases in between. The publication also presents practical suggestions for assessing technology needs and ensuring systems are fully responsive to business needs.

The contextual framework for the wider enterprise transformation discussion is established in Chapter 1, which maps out the inherent structural complexities of the private equity business model that IT systems ultimately need to support. The interdependencies of business functions and stakeholders and the critical role technology plays in enabling the seamless flow of communication and information across the business is addressed in Chapter 2. A closer look at the unique business challenges private equity presents and how they determine IT needs is the focus of Chapter 3.

The architectural phases of the enterprise transformation programme are covered in . How to define and create an enterprise architecture in order to provide a practical framework for change is covered in Chapter 4. This is the first step to assessing whether change is required and to what the extent. But before making changes, a clear picture of the current structure of the business its functions, processes, resources and technology is helpful; this is the business architecture phase and it provides the vital information needed to determine where inefficiencies or gaps exist in the current business model and to identify exactly where changes must be made. This phase is discussed in Chapter 5. Data architecture is covered in Chapter 6 and offers a structured approach to technology supported data and information management, which is fundamental to meeting increased reporting and transparency demands. Chapter 7 details the application architecture phase defining how individual IT systems are to be deployed and how they should interact. A practical methodology for evaluating and rating systems and products is also set out in this chapter. Chapter 8 describes the technology architecture phase in which standards for technology usage are defined to ensure systems are used consistently across the enterprise and that IT changes are driven purely by business needs. This phase is also critical in determining whether investing in new solutions is a desirable option or whether existing solutions are sufficient and can be adapted. The final phase, discussed in Chapter 9, is the target architecture which involves building a migration and system implementation plan for completing the transformation programme. Chapter 10 looks at some of the current technologies trends hitting the private equity market such as cloud computing and virtual data rooms.