Catalant’s 2024 Annual
Trends Report
The activity on Catalant’s platform provides a glimpse into the highest-priority initiatives across leading enterprises, private equity firms, and consulting firms. Take a look at what 2023 revealed and what we predict for 2024.
Profitability and cautious return to growth
With interest rates rising and the cost of capital spiking throughout 2022 and 2023, priorities shifted away from “growth at all costs” to a focus on the bottom line. Today, we seem to have settled on cautious, measured growth and a focus on profitability.
Catalant’s Growth Trend Index revealed a shift from 2022 to 2023 in growth- and bottom-line-oriented projects:
- While bottom-line-focused projects increased significantly in 2022, they stabilized to a relatively flat level in 2023, remaining 20-35% higher throughout all of 2023 as compared to Q1 2022’s low point.
- Growth-focused projects, taking a backseat in 2022, popped in Q2 2023 and remained high through the year, signaling hints of a return to growth.
Transformation within private equity portfolios
Private equity firms are finding that financial engineering is less needle-moving in today’s tough economic environment. The combination of $2 trillion in dry powder, chasing fewer attractive assets, and higher interest rates necessitates a shift toward operational excellence. PE firms must roll up their sleeves to add more operational expertise into the companies they own.
Absent the quick impact of typical financial, cost, and margin-improvement levers, we’ve seen even more focus on operational value-add activities through operationally-focused projects. Investment in operationally-focused work was up 35% year over year in the PE segment, while investment in the same type of work was down 24% year over year across the Enterprise segment.
Enterprises will shift from supply chain defense to offense
A more stabilized macro environment will lead to normalization of the supply chain in 2024. Companies will go from a defensive position – a focus on fixing their existing inventory management problems, to an offensive position – a focus on optimization, digitization, and innovation, while remaining operationally efficient. This will involve AI/ML-related projects within supply chain, to optimize things like purchase orders to avoid the inventory management build-up we saw for much of 2022 and 2023.
Want to explore more trends?
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Today’s leadership teams are focused on operating efficiently, reacting to changing market conditions, and making the most of their budgets. Activity on the Catalant platform provides a glimpse into leading-edge trends and ways to solve challenging problems.
Download the free report to understand the trends from 2023 and what we predict for 2024, including:
- M&A rebounds to reach post-pandemic highs
- Transformation work continues to grow
- Enterprises will shift from supply chain defense to offense
- GenAI projects move from exploratory to implementation
- And more
