March 2, 2024

Five Questions with John Flannery, Managing Director with Charlesbank Capital Partners

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About John Flannery
John Flannery joined Charlesbank in an advisory role in 2019 after 31 years at GE, where he most recently served as chairman and chief executive officer. At Charlesbank, he co-leads the Portfolio Resources Group, working with CEOs and their teams to improve operating performance, strategy and governance. He also helps the PRG team drive consistent equity value in the portfolio overall.

John began his career at GE in 1987 and held various leadership roles in the United States, Latin America and Asia, including CEO of GE Equity (a $6B private equity fund), CEO of GE Capital Asia, CEO of GE India, head of GE’s M&A and strategy process and finally as CEO of the $18B GE Healthcare unit. Under his leadership, GE’s healthcare business established global technology leadership in core imaging, creating digital platforms and solutions, and expanded its Life Sciences and cell therapy systems businesses. He also launched Sustainable Healthcare Solutions, bringing disruptive technologies to healthcare providers across emerging markets.

John is an Alexandria, Virginia native who lives in Boston. He and his wife have three grown children.

Fairfield University – BS in finance
The Wharton School at the University of Pennsylvania – MBA

5 Questions

The PE industry now has over $10 trillion in assets under management. What do you see as the biggest change in the space since you joined it?

I certainly had touched PE with GE over the years. But the first thing that struck me when I joined Charlesbank was the caliber, quality, horsepower and intellectual rigor of the people. They are incredibly analytic on underwriting businesses… so much more robust than GE on analyzing companies. I love the alignment between investors and operators in private equity and striving for outcomes together. PE obsesses with time and marginal allocation down to a weekly level.

That said, they still need to identify the make or break issues and in my experience that comes down to the people, every single time. 

What was it about your background that made you effective in your role?

In terms of being effective as an operating partner, I just never forget to drive focus on the key strategic initiatives, and then to drive focus on the suitability of management vis-à-vis the value creation plan. I’ve also focused on translating between the PE firm and the management team. Moreover I’ve always tried to be a servant leader.  I win if we all win.

Growing up in GE, it was always drilled into us that the two most important things are clarity of strategy, and having the right people in the right jobs to achieve it. At GE we tried to be super deliberate about this. We referred to it as “Session C”. It was the annual assessment of the management talent. And in private equity, you’ll ultimately be scored on these two things. Our success is simply a derivative of the strength of the management teams.

Operating Partners have so much exposure to companies, but there’s still a big difference in those who’ve actually run something versus those who have not. That last mile is a pretty big mile. 

What things can a new Ops Partner do to smooth their transition onto the team and into the firm’s culture? What’s a common misstep?

To help new operators smoothly transition onto the team, first, I would advise that they learn the business of PE enough to be valued. How are people motivated? What are the time frames? Understanding fund raising and deploying money. 

If you’re an Ops Partner, all the deal people really care about is your ability to influence equity value creation. Ask yourself that question every week. 

Secondly establish trust with the Managing Partner on the PE side and the CEO of the portfolio company. The deal guy and the CEO must be on the same page regarding what you’re doing at the company. 

Did you develop any secret tactics or strategies to help you more effectively manage the time in your day?

Time management in PE… honestly I’m not that great at it. I spend a third of my time on companies where I’ve got direct involvement: either as the Chairman or a board member. I spend a third of my time with the PRG (portfolio resources group) and the people. What are we working on? I then spend a third of my time on firm, investment committee, new business development, and diligence. 

Inside an ops team, people may suffer from “drift.” This wastes time. Many times we start out with a clear project and scope. Then if we have a good personality match with a company, the CEO asks us to look at more and more. They suck you in. All a PE firm has are its ideas and its time and we can’t squander these.  There’s an ever present shot clock against which we operate and thus we need week to week assessment on how and where we are working.

Any good recommendations for us from your personal reading list or your best binge watching show?

My wife has been trying to get us to see all of the Oscar nominated films before this year‘s ceremony. That should be interesting.  In terms of books that I’ve read recently and would recommend they include “Mosquito Bowl” written by Buzz Bissinger.  The story is about young and promising Marines in World War II set against the backdrop of the senselessness of the war. Also highly recommend “Demon Copperhead” by Barbara Kingsolver. It’s an awesome fictional book… a modern-day David Copperfield story set in the opioid environment of rural western Virginia.



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