Demystifying corporate development: How a war room can enable execution speed

Companies currently face an abundance of challenges, including supply chain disruptions,  labor shortages, changing consumer preferences and an uncertain macroeconomic landscape. They often need to dedicate resources to activities outside of traditional business as usual (BAU) to respond to regulatory inquiries, address liquidity concerns or scale tech capabilities — all while maintaining day-to-day operations. 

Layering in strategic opportunities such as M&A – which can address some of those challenges by transacting to transform – creates additional work requiring aligned planning and centralized coordination. A war room can be an invaluable tool led by corporate development teams that drives optionality by helping companies quickly respond to these changing dynamics.  Sounds like the 90s?  Maybe, but let’s reflect on some of the key enablers that those walnut-walled rooms manifested with boxes of data and all the key players in one place…

To stand-up a war room, corporate development ensures the right stakeholders are engaged and mobilized, creates and drives a unified strategy to respond to new challenges, and establishes a governance framework for war room operations. In today’s world, the rooms may no longer be walnut-walled, but the importance of creating an agile and decisive environment remains critical. Whether by leveraging the power of modern technologies to connect remotely or by meeting in person, the key players need to be in one place.

Engaging stakeholders to create a war room

War rooms assemble key decision-makers to evaluate challenges and strategic opportunities that arise during times of economic stress. They help a company maintain BAU activities while also addressing new, pressing challenges.

Corporate development should ensure the right stakeholders are engaged in the war room. Stakeholders typically include c-suite members and business unit leaders. The specific participants and size of the war room are informed by the challenges being addressed. As challenges arise, war rooms would likely gather on a weekly basis with frequency increasing as issues become more critical or time sensitive. Corporate development teams need to build trusted relationships with cross-functional and cross-BU stakeholders to ensure successful collaboration and efficient execution.  

Creating and executing a unified strategy

Challenges outside of BAU that pose critical risk can create resourcing, governance, and other gaps that need to be filled. Corporate development teams use war rooms to identify gaps and provide potential solutions. For both organic and inorganic solutions, corporate development teams lead war room stakeholders in assessing internal readiness, resource needs and capabilities while also examining external opportunities (i.e., M&A targets). By aligning key stakeholders and decision-makers with organizational goals and execution strategy, a war room enables speed in execution of optimal strategy identification, governance and diligence to execute on the opportunity.

Mitigating risk through governance 

Speed can create risk, which a war room mitigates through implementation of governance structure, establishment of decision-making authority and early achievement of stakeholder buy-in. Centralized governance establishes the framework for stakeholders to make decisions, effectively streamlining and expediting the risk assessment process.

The cross-functional nature of a war room ensures that key considerations from multiple perspectives are factored into decision making (e.g., HR, Technology, Legal, Finance, Ops, as well as the individual business units). This helps the team avoid unanticipated downstream impacts. 

Corporate development teams also ensure cross-functional leadership is aligned on priorities, goals and benefits of a transaction. Therefore, through a war room, corporate development teams can achieve rapid buy-in from leadership on key considerations to the strategic implementation process (e.g., execution updates, risks, resourcing needs, etc.).

In conclusion

As businesses face new, dynamic and external challenges, a war room is a critical, proactive tool that increases preparedness and ensures proper governance to execute on strategic opportunities. Corporate development’s creation and management of a war room enables execution speed by gathering key stakeholders, expediting decision making and mitigating transaction risk.

If you have any questions, or are looking to learn more, visit pwc.com and reach out to our PwC Corporate Development partners. 

We also invite you to explore the rest of our Demystifying corporate development series: Debunking five common myths and Preparing to benefit from economic cycles.