Fifty Canadian companies are being recognized today as the 2012 winners of Canada’s Best Managed Companies program for having demonstrated outstanding business performance and innovative management. Growth was at the top of the agenda for Canada’s Best Managed Companies in 2012. Best Managed winners made strategic investments in their companies, platforms, their systems and in their people and in turn, revenue and income grew substantially. Best Managed winners’ revenue grew by 14% to approximately $5.4 billion and more impressively, income grew by approximately 24%.
“During the program’s 20-year history, thousands of private companies have competed for this designation,” says John Hughes, Deloitte partner, national leader for Canada’s Best Managed Companies program and leader of the Toronto Growth Enterprises practice. “This year’s winners have proven that even during a global financial crisis, they are still optimistic about the future, focusing on key operating metrics and accountability.”
Now in its 20th year, the Canada’s Best Managed Companies designation remains an emblem of pride for private Canadian organizations with revenues over $10 million. Fifty new companies have now joined the ranks of other powerhouse Canadian companies that have achieved business excellence.
“Not only are these businesses demonstrating excellence in Canada, but from coast-to-coast we are seeing more private companies expand beyond our borders,” says Dino Medves, senior vice-president, CIBC Commercial Banking. “By harnessing their strong management team, a robust business plan and a solid balance sheet, these companies have created the support necessary for strategic international investment.”
In the current soft economy, Best Managed Companies are focused on a few vital priorities to ensure their business thrives:
- Best Managed Companies see the current economy as a buying opportunity. They expect mergers and acquisitions (M&A) activity to increase cautiously over the next two to five years. Best Managed Companies continue to look to strategic-alliance and joint venture activities as the initial steps to a transaction commitment and “tuck-in” acquisitions as a means to build a platform company.
- Best Managed Companies are also looking to build acquisition pipelines. Since these companies have limited resources they need to be very strategic and selective about acquisitions and look for opportunities that are accretive to their businesses. In addition, there has been significant increased interest in M&As from private equity firms, not just in Canada but also in the US and UK as Best managed Companies represent significant growth opportunities for Canada’s largest investors.
- As Best Managed Companies mature, they offer more sophisticated “onboarding programs” for key leadership positions. A few years ago, onboarding of key executives usually consisted of a tour of the company’s operating facilities and meetings with certain customers. Best Managed companies have been much more sophisticated in ensuring new executives and employees understand their company’s vision, its operations and key strategic plans. They also engage new folks in peer learning that builds them up for success in their new roles.
- This year, Best Managed companies are reporting more women in the executive ranks and an increase in the number of newcomers to Canada.
- Many of Canada’s Best Managed Companies are looking to new products and services as a means to increase revenue and income. Innovation has been taken to new levels to create disruptive technologies and clearly differentiated products.
- Succession planning has now become a more all-encompassing exercise that moves from family discussions around the next generation of management to a broader discussion including family transition, private equity investment, sales to strategic buyers and IPOs.
- A significant number of owners plan to exit their businesses within the next five years and are starting to take a more holistic view of business succession and transition. Owners will engage in conversations to build sustainable businesses and continue to focus on creating value and protecting that value.
2012 Best Managed Companies program winners