What an operating partner is for
The role sits between an investment firm and its companies. It works when it adds capacity to a management team and fails when it adds another layer of meetings.
I have worked as an operating partner at two points in my career: early on, at a private equity firm, and now alongside my role as a chief financial officer. The title means different things at different firms. This is what I think the job is.
Borrowed capacity
Management teams in sponsor-owned companies are usually lean. Everyone already has a full job. An operating partner is most useful doing the work nobody on the team has time for: the pricing analysis, the vendor negotiation, the first version of a cash forecast. Advice is cheap. Hours are what a lean team is short of.
Patterns across companies
A company sees its own problems once. Someone working across a portfolio sees the same problem five times. That is the real advantage of the seat. A software contract that three companies hold separately can be negotiated once. A planning calendar that works in one company can be adopted by the next without being reinvented.
Whose plan it is
The work has to end up belonging to management. If the operating partner owns an initiative, it stops when he leaves the room. I try to hand over every piece of work with a named owner inside the company and a way to tell whether it is still happening three months later.
What to ask for
If you run a portfolio company, ask your sponsor for specific help with an end date: one problem, one person, eight weeks. If you are the operating partner, ask the chief executive what is not getting done, and start there.
The measure of the role is simple. The company should be able to do something after you leave that it could not do before.