We get this question a lot. First, there really is a Trout Creek near the founder’s home in the hills west of Philadelphia, Pennsylvania. Second, just as trout fishing is a stress reducing activity, our name is meant to inspire the confidence and lower stress that come with improved decision making. Finally, the leaping trout in our logo is a symbol of success overcoming challenges – whether in fishing, business, or life.
Can Trout Creek Consulting help clients with Scenario Planning?
Yes, we can! To quote Cari Tuna's July 6, 2009 column in The Wall Street Journal, scenario planning consists of "preparing responses to imagined changes in conditions". TCC's strengths include
* "Real world" experience, judgment, and industry knowledge
* Market research, including primary market research experience
At TCC, we combine our strengths to identify upside and downside scenarios for consideration, understand the impact of each scenario, develop and test possible responses, and help clients select the best responses.
Who needs the services of Trout Creek Consulting?
TCC helps clients facing complexity, ambiguity, and important decisions succeed. We achieve this through our offerings: Actionable Strategies, Market Understanding, Objective Valuations, Business Simulations, Corporate Development, Immediate Impact Workshops, and Due Diligence Support. Just about every firm might need the services of TCC at one time or another to help enable growth; understand and respond to rising competitive pressures and changing customer, supplier, and regulatory dynamics; value an opportunity; improve decision making; or implement external initiatives. At TCC, we are differentiated by our operating experience and judgment, industry knowledge, finance skills, problem solving ability, and simulation capability.
Our client segments include
Operating Companies in many industries, including the biomaterial, biopharmaceutical (including follow-on biologic or biosimilar), cosmetic/cosmeceutical, energy (traditional, synthetic, renewable), fine chemical, food ingredient, medical device, nutraceutical, oral care, petrochemical, pharmaceutical, and specialty chemical industries
Service Providers such as accounting firms, law firms, human resource consulting firms, and other management consulting firms.
Investors in our covered industries, including private equity, venture capital, wealthy individual, and corporate investors.
Actionable Strategies, Objective Valuations, Business Simulations, and Market Understanding all seem related – are they?
Why is simulation so important?
Will Trout Creek Consulting give me some indecipherable program that only TCC can understand?
The short answers to these questions are yes, it’s an enabler, and no. The longer answer…TCC’s founder has used simulations to think through and solve many real world situations such as
* Starting up and operating complex manufacturing plants
* Defining and implementing business strategy in a challenging environment with technology upheaval, aggressive competitors, many opinions, and few facts
* Valuing acquisitions in competitive industries
* Valuing life science (biopharmaceutical, medical device, pharmaceutical) development portfolios with numerous end states
* Defining supply chain strategy for life science businesses with multiple products, multiple internal manufacturing locations, outsourcing opportunities, and both financial and strategic (e.g., intellectual property, risk management) constraints
TCC’s founder believes that good simulations create value through Market Understanding, scenario and sensitivity analyses, identification of value drivers, better predictions, and ultimately, improved decision making. Simulations deliver clarity from complexity and ambiguity. Business simulations avoid the cost, time, interruption, and possible disasters that can occur when “experimenting” with a running business.
At TCC, our simulations, while complex, are constructed using Microsoft Excel in such a way that our clients can understand, check, and use the simulations themselves. Having been consulting clients ourselves, we understand a client’s need to be “comfortable with the model” before making simulation-based decisions.
Isn’t business simulation just playing with spreadsheets?
A business simulation is comprised of three distinct phases – Definition, Construction, and Analysis.
Definition
A business simulation starts with defining the questions to be answered. That is, what do we need to learn about the future, our opportunities, our business, our industry, and the impact of various internal decisions and external events to find the best path forward? TCC works with the client to define the questions to be answered, the scenarios and sensitivities to be investigated, and the simulation output metrics and format that are most useful to the client.
For example, output metrics might include NPV, cash burn per quarter or year, resource level by function, ROI, EPS impact, and profit by product and region. The output format might include tables, tornado diagrams, or line graphs contained in presentations or written reports. Output metrics and format are chosen to best convey the situation and the decisions to be made, as well as to reflect client preferences.
Construction
The second phase of business simulation involves algorithm development, market research, and simulation programming. TCC, either by itself or working with the client, develops the mathematical relationships that describe how demand, price, cost, market share, resources, and other elements change through time with competition, product life cycle, government regulation, excess capacity, development stage, and other variables. Decision trees are constructed to include external events, internal decision points, and various outcomes. Market research on the underlying subject matter and close proxies is necessary to develop algorithms and find input data. In many instances, market research involves “scrubbing” data to understand and either (a) remove true one-off anomalies or (b) add non-recurring events that regularly occur. The simulation is constructed in a user friendly format and rigorously tested for quality assurance. Validation is accomplished using test scenarios.
Analysis
Lastly, there is the “playing with spreadsheets” phase where scenarios are analyzed, insights and “Ah ha!” moments are found, and answers are obtained.
Does Trout Creek Consulting focus on a particular industry?
Will Trout Creek Consulting work for clients in industries where TCC doesn’t have industry knowledge?
TCC was founded by a problem solver who really believes in (a) the benefits of improved decision making and (b) that management consultants with strong problem solving and finance skills, significant operating experience, and industry knowledge will deliver superior value to clients. TCC doesn’t focus on a particular industry, TCC focuses on helping clients tackle tough challenges. Sometimes we obtain business based on our industry knowledge, sometimes based on our judgment and functional skills, and sometimes based on a combination of both. We are fast learners and can readily adapt our strategy and valuation tools to new areas.
What is the benefit of an outside, independent analysis?
There are many benefits depending on the context. With respect to 409A and some other types of valuations, having an unrelated, independent valuation specialist provide the valuation minimizes actual or perceived conflicts of interest and lends credibility to the valuation.
More broadly, the right outside, independent adviser may provide skills and industry knowledge that are not resident within the client’s firm, or a fresh perspective to avoid “group think”, or a new approach to a seemingly unsolvable problem. A third party adviser can bring “horsepower” and available capacity to a lean firm suddenly in the midst of several important decisions. Finally, an outside, independent analysis can be a productive way to either confront or progress solutions to controversial issues.
How does Trout Creek Consulting get paid?
What is the business model of Trout Creek Consulting?
Because our engagements are client-focused, every engagement that TCC undertakes is based on a written proposal that contains the scope, schedule, and terms and conditions. Clients typically pay for two categories of expenses – professional service fees (our consulting services) and miscellaneous expenses (e.g., travel and lodging, etc.). With respect to professional service fees, TCC bids most offerings using either a per-consultant-day rate with an estimated number of consultant-days or submits a fixed-price bid. It depends entirely on the offering and scope of the engagement. Our Corporate Development offering is provided on a retained basis. Miscellaneous expenses are agreed upon before incurred and are invoiced without mark up.
TCC’s motto is Creating Value Through Improved Decision Making. How important is decision making compared to other leadership skills?
The 2008 Best Companies for Leaders survey, conducted by the Hay Group and Chief Executive Magazine, identified Strategic Thinking, Execution, Decision Making (tied for 3rd), and Technical Competence/Expertise (tied for 3rd) as the characteristics that organizations value most in their leaders. People from 1140 companies, headquartered in 89 countries, participated in this survey.
We get this question a lot. First, there really is a Trout Creek near the founder’s home in the hills west of Philadelphia, Pennsylvania. Second, just as trout fishing is a stress reducing activity, our name is meant to inspire the confidence and lower stress that come with improved decision making. Finally, the leaping trout in our logo is a symbol of success overcoming challenges – whether in fishing, business, or life.
Operating Companies in many industries, including the biomaterial, biopharmaceutical (including follow-on biologic or biosimilar), cosmetic/cosmeceutical, energy (traditional, synthetic, renewable), fine chemical, food ingredient, medical device, nutraceutical, oral care, petrochemical, pharmaceutical, and specialty chemical industries
* Starting up and operating complex manufacturing plants