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Integrating senior advisors is becoming common practice among private infrastructure firms, following the approach used in private equity.
Insights, Expertise and Leadership
These advisors bring valuable insights, networks, and expertise that complement the skills of firm professionals and portfolio leaders. However, the lack of a standardized model for engaging senior advisors creates a need for greater clarity and structure.
Closing the gap
To fill this gap, Russell Reynolds Associates conducted interviews with industry professionals in private infrastructure sectors.
Role, Communication and Performance
The research revealed effective practices in engaging senior advisors, highlighting the importance of defining clear roles, promoting open communication, tracking performance, and adapting the advisor model as capabilities evolve.
In the private infrastructure landscape, senior advisors typically have distinct roles in deal origination, due diligence, and asset management. Matching an advisor’s background to their mandate increases the chances of success, although it’s rare for one advisor to fulfill all three roles.
Separating roles
Firms deploy different engagement models to suit their needs. This includes long-term relationships with formal programs and mentorship, co-investment models to drive value creation, utilizing technical experts for temporary needs, and separating roles for targeted results.
Clarifying roles
Common best practices in senior advisor engagements include clarifying roles, aligning expectations, promoting regular communication, fostering a community, and measuring performance to build trust. Effective engagements are crucial for firms to secure deals, maximize potential, and attract top advisors.
Take-aways
While a one-size-fits-all approach doesn’t exist, establishing effective engagement strategies tailored to each firm’s specific context ensures optimal collaboration and mutual benefit. These refined models improve outcomes and position firms as preferred choices for senior advisors in a competitive landscape.
