Operational Due Diligence (ODD) offers organisations key insights that enable growth and deal readiness, providing a detailed examination of operational health - uncovering inefficiencies, risks, and unique strengths.

Often carried out alongside commercial, financial, and legal due diligence activities; ODD seeks to makes clear often overlooked areas of risk and untapped value potential making it a key component for companies in deal cycles or those optimising operations.

Operational benchmarking is frequently a core component of ODD, delivering insights to help enhance efficiency, reduce costs, and improve performance; making companies more attractive to investors and better positioned for long-term success.

Our services

Focus areas

Key focus areas which are explored through operational due diligence include:

Safety and quality management processes
Resource utilisation, cycle times and throughput
Inventory management and supply chain metrics

Technology platforms (relevance, utilisation and security)
Levels of automation versus industry norms
Physical security and condition of facilities

Appropriateness of existing leadership and oversight
Adherence to industry standard risk and audit controls
ESG and stakeholder engagement evaluation

Hiring, dismissal and retention policies versus norms
Succession planning, learning and development strategies
Workplace culture and worker satisfaction KPIs

Underpinning all operational aspects of the business is a consideration of:

Appropriate KPIs in place to monitor performance, backed by appropriate incentives to drive continuous improvement
Existing operational practices resulting in positive, sustainable relationships with supply and customer stakeholders
“Red Flags” where business practices ultimately undermine growth and must be remediated urgently

Read our case studies

Two people working on laptop and documents

Buy-side Operational Due Diligence

KPMG was tasked with conducting operational due diligence on a target software company for a private equity firm. We carried out management interviews, peer benchmarking, and collaborated with our commercial due diligence teams, as well as our client's legal and financial due diligence partners. Software companies often focus less on working capital and assets, exposing investors to risks only identified through operational due diligence, such as management capability and relevant technical skills.

Through extensive peer and global benchmarking, combined with CDD, LDD, and FDD, we concluded that the target was well-prepared for emerging risks and had a suitable operational structure to support growth. This resulted in a positive outcome for both our client and the target, ensuring sustainable growth post-deal completion.

Sell-side Operational Due Diligence

KPMG helped a leading M&E contractor assess their operations, identifying strengths and weaknesses before seeking new investors. We conducted management interviews, peer benchmarking, and collaborated with our commercial and financial due diligence teams to provide comprehensive insights.

Many construction and specialist contracting companies are growing significantly, with strong EBITDA valuations. Despite this growth, these organisations often struggle to meet demand due to operational gaps. Skills shortages are a common issue, and many companies also face challenges in structuring for international expansion or managing complex supply chains.

Our assistance enabled our client to identify and resolve previously unnoticed system and capability gaps, making them a more attractive investment prospect for financiers.

Joint-venture Operational Due Diligence

KPMG recently assisted an Irish manufacturer in seeking new investment through a joint venture with a much larger competitor. By providing industry insights and benchmarking, we identified areas of expertise and opportunities for value creation. Our client used these insights to enter the deal with a strong bargaining position, securing optimal terms and crafting favourable long-term options.

Joint-venture Operational Due Diligence

Organisational benchmarking

KPMG was engaged by a telecoms client to carry out organisational benchmarking to compare FTE allocation across their business to that of peers.

Given the uniqueness of the client’s subsector, a bespoke approach to benchmarking was adopted. This approach included identification and selection of comparable peers and discrete consultation with the peers to understand team structures and FTE allocations. Insights were presented to the client with peer FTEs scaled via operational metrics to be comparable to the client's organisational composition. This provided the client with greater insights ahead of any organisational rightsizing activities and organisational benchmarks that can be scaled as operations grow.

How KPMG can help

KPMG’s Strategy practice provides strategic support with decisions on where to invest, uncovers new opportunities, and provides rigorous M&A support pre, during and post deal.

KPMG combines experience of hundreds of Irish deal due diligences with our global proprietary benchmarking data from 100,000 datapoints across thousands of global projects to drive distinctive operational benchmarking - enabling valuable insights beyond typical financial information.

If you are considering M&A, are seeking investment, or looking to make your company more efficient - get in touch.

Book a no-obligation confidential consultation