Challenge management to anticipate change and embrace that change.

Joseph Berardino is a Managing Director at Alvarez & Marsal in New York. He leads the Firm’s US Corporate Transformation practice, as well the East Region of Alvarez & Marsal’s Corporate Performance Improvement practice. He has served on several public company Boards of Directors, and is comfortable in the boardroom working with CEOs and boards to unlock shareholder value amidst complex dynamics.

Previously, Berardino was an audit partner with Arthur Andersen where he spent more than 30 years in various client-serving and leadership roles, including CEO of Andersen Worldwide.

Pamit Surana is a Managing Director with Alvarez & Marsal’s Corporate Transformation practice in New York. His primary focus is enterprise wide transformation specializing in rapid cost reduction. Surana recently delivered $2+ billion in realized savings for clients, led pre-merger activities for a $40B merger and led large global projects for Fortune 50 to mid-cap clients.

He currently serves on the Board of Directors of New York City Cultural Affairs Council’s Materials for the Arts, is very active with the Coca-Cola Scholars Foundation, President’s Council on Fitness, Sports and Nutrition and Queen Silvia of Sweden’s Mentor Foundation.


Christopher P. Skroupa: How often is cost reduction the sole transformation goal?

Joseph Berardino: All too often. Transformation is hard and it is enterprise wide. A cost take out is one component to transformation and it is often mistaken for transformation and or has become synonymous with transformation. The terms are not interchangeable.

Transformation must be anchored in clear, articulate strategic priorities, and an enterprise’s customer value proposition. Cost take out is often necessary to make the organization more agile in pursuit of customers’ needs.

Skroupa: Where do you see activists going next?

Berardino: Almost everywhere. Every industry is facing digital disruption. Rapid transformation is key however it is also extremely difficult. Amazon recently accounted for 89 percent of all online sales out of the major retailers for the entire 2017 holiday season. What does this tell us? The speed and the scale of disruption is of a magnitude where companies must be on the offensive now, and to do that they must constantly reinvent themselves.

That requires leadership and a proactive mentality before an activist comes in. When an activist arrives, agility becomes absolutely necessary. Technology changes quickly, and traditional managements change slowly.

Skroupa: What can companies do to help mediate the disruption of an activist investor? What about the newly elected activist director to the Board?

Pamit Surana: They can be proactive. By building an outside-in perspective of your company’s performance, we aide our clients in proactively assessing the financial performance and public perception of their business through publicly available information, as well as our industry insights. This allows the company to have a deep understanding of how they look to an activist investor. The company then has the ability to enact change and take on transformation prior to an activist getting a Board seat or taking a position.


Skroupa: And what does the outside in perspective give a business?

Berardino: The outside-in perspective provides three crucial elements in performance assessment, namely:

  • Identification of financial and operational performance gaps vs. the industry and competitors;
  • Corporate governance and board composition reviews; and
  • A business case for specific initiatives to increase shareholder value.

Leadership from the top is critical. We come in as a firm that provides that leadership edge and an objective mentality. When working with the board, we take the independent and objective view of the activist in order to find the middle ground. Company management gets displaced when they are abstinent, and when they refuse change. 

Skroupa: What is operational activism and what are the trends are you seeing in the activist situations you have been involved in?

Surana: Financial Engineering and Corporate Governance is being replaced by Operational Activism. Now, it is time to fix the business and that is the harder work.

In our experience, boards and management are successful when they focus on action. In other words, insights don’t give businesses the answers on how to transform or how to become more agile. Perhaps they are getting a “what to do” via insights, but not a “how to do it.” We bring that wisdom and that leadership via our operational and restructuring heritage.

Skroupa: What’s one piece of advice you would give management?

Surana: The technological revolution is ahead of us, not behind us.

Skroupa: What’s one piece of advice you would give to a board of directors?

Berardino: More change is coming. Continue to challenge management to anticipate change and embrace that change.


Pamit Surana was a presenter at the Shareholder Activism conference this past January. Check out more conferences on activism created by Skytop Strategies here.

Originally published on More articles by Christopher Skroupa on his Forbes column.