PE-CXO’s Success Stories cast a spotlight on private equity-backed operators and the tools and tactics they leverage to create real value. In each entry, a world-class executive details a practical solution to a critical business issue. To be featured, contact us with the subject line “Success Story“.

Executive: James Sprouse, former CFO at Cleaver-Brooks, a private equity-backed manufacturer of boiler room products, and former Vice President of Finance at Corizon Health, a private-equity backed provider of correctional healthcare services.

Challenge: Devising a contract structure that appeals both to the contractor and client  

Solution: Collaboratively analyzing data and thinking outside the box

If we were going to win this contract, I knew we’d have to come up with a creative solution.

When I worked as a finance executive for a Tennessee-based company that provides healthcare in correctional facilities, we were pursuing a contract with a state Department of Correction. For numerous reasons we didn’t think we had a very good chance at winning the contract. 

For one thing, we were competing with a number of other companies, one of which was the contractor that had held the contract for the past 13 years. For another, the state required that the contractor partner with a single insurance provider to provide off-site care to inmates. Unlike the incumbent, we couldn’t access the largest insurance provider in the state, which we felt put us at a disadvantage.

Nevertheless, we decided the contract was worth pursuing. It stood to generate $100 million in revenue per year, which would increase our revenue by 20%. Opportuni...