Posts tagged with: control
Too often, business owners don’t recognize the signals and symptoms that they need to start now to plan for their ideal exit transaction and their transition to the reinvention of their dreams. No one ever told you what those symptoms are.
As an owner you surround yourself with exceptional experienced advisors who help you increase sales, build out your team, manage your finances, upgrade your infrastructure, stay compliant with a myriad of licenses and regulations, etc. But who monitors your business readiness to sell, scale or pass the business on to your successors when it is opportune, instead of too late?
Symptoms to Look For
Here’s my list of symptoms to look for. If you recognize that any of them describe you now, then indeed you need to start planning for both that transaction and your transition plan to reinvention. That’s because it takes 3-5 years to prepare you, your business, your family and your finances (personal and business) to leverage that ‘once in a lifetime’ transaction to achieve the reinvention you’ve been dreaming of.
- Age. You are 55+ and you keep postponing any exit or transition planning (“I don’t need to start thinking about it for at least another 5 years”).
- Successor. You keep on keeping on because you have not identified your successor or groomed the assumed successor.
- Retirement. You find yourself pondering about what comes next; retirement, reinvention, golden years. This question in itself can stifle business and cause insomnia.
- Change. You resist changing your business model to compete effectively, grow and strengthen your market positioning. Maybe things have grown stale, and you’ve run out of ideas to keep your business moving forward. Or maybe you would need to pour tons of money into updating your business and you are resisting the investment.
- Motivation. What drives you now? Do you have a hard time getting up in the morning and going to work, or making the calls necessary to keep your business running?
- Focus. Your focus is drifting away from the business. Life changes, demands and opportunities may be causing you to lose focus or shift priorities.
- Family. Your family keeps asking you when you will slow down and you keep saying never.
- Dynasty. You worry that your wealth may not be enough to fund your reinvention lifestyle for decades to come and provide for the generations to follow you.
- Children. You now know your kids don’t want, or are incapable of running, your business.
- Legacy. You are thinking about how to answer the question of what is your legacy and what do you want it to be, and therefore; how that will impact any transaction where you let go of day to day operations.
- Expansion. You are spending more time thinking about maintaining rather than expanding your business. You settle for good enough or watch competitors take the lead.
- Health. You or a family member may be facing specific health concerns that limit your participation in the business, distracting you, which can risk your revenue stream.
- Energy. Your stamina to run the business as you once did is declining.
- Profit. Your financial focus has shifted from maximizing profits to what you can get when you cash out.
- Planning. Your strategic planning efforts stagnate.
- Customers. Your customers are all tied closely to you personally, not the business.
- R&D. You have been reinvesting in the company less and less as you start to pull more cash out of the business.
- Dependence. Your business depends on your day-to day decision making. It’s not the turnkey operations buyers will pay a premium for.
- Exit. You are starting to ask what it will take to make your business buyer ready, buyer attractive and more sale-able.
- Offer – You get one or more calls with offers you’d be foolish to refuse.
- Next Venture – You are more interested in your next opportunity, or to do something else you’ve always wanted to do, pulling you forward.
Start that planning now to ensure you will:
- Maximize the value of your business
- Maintain control
- Increase the leverage you can command at the negotiating table
The longer you wait, you will continue to lose all three.
If you need help to assess your symptoms or make a timely plan to complete the transaction that will achieve your dreams, call 508.820.3322 or email us.
You can exit your business on your terms so you can transition to the lifestyle of your dreams with the wealth to pursue your reinvention (venture, adventure, avocation, hobby, retirement)
But what you can’t do is assume you can simply hire a team of experts and just walk away from your business in the next six months.
Start with your exit criteria to achieve your ultimate goals as you transition to your reinvention.
• Freedom — What does freedom look like to you when you exit your business, after the exit transaction is complete?
• Control — Who’s in control of decisions, strategy, budget, operations, and sales now? Who will be in control of each area of the business when you exit? Have you transitioned the decisions and control to one person, to a team of leaders or to no one leaving a vacuum in the business?
• Wealth — What is your wealth requirement for your reinvention and lifestyle after you exit? How do you define wealth? How much of the wealth you need for your reinvention must come from the business? Can you liquidate the business to produce that level of wealth to achieve your other exit criteria?
• Liquidity — How much liquidity do you need immediately when you exit? How long can you wait to receive final payment?
• Timeline — What is your ideal timeline for your exit? For your reinvention? For liquidity?
• Legacy — What’s your definition of the legacy you want to leave behind? What do you and your business stand for? What do you want to be remembered for? How can you achieve that?
• Dynasty — Do you want to build a family dynasty? What would that look like? What do you have to put in place to realize your dynasty?
Why Don’t We Use Tools To Track And Measure The Profitability Of Our Efforts?
Why Don’t We Track And Measure Every Effort With Prospects And Clients?
The answers are many, wide-ranging and constant. We:
- Are Too Comfortable
- Are Resistant to Change
- Assume it will be too complicated/complex even before considering options
- Presume all this is prohibitively expensive
- Supported in our old ways that keep us out of control, overwhelmed, paralyzed, in a rut
Which ones apply to you?
If you have not cashed out at your target number, at least one of these blinders may still be in your way.
To achieve the short-term and long-term goals you know you can attain in your business, with your team and your clients, you must implement plans and systems. Only when you institute systems and processes can you track and measure the results to ensure the business achieves your objectives on your timeline.
Those same systems and processes will give you a foundation for your forecasts that a buyer will put great weight on in deciding to acquire your business and at what price.
The systems, plans, processes you develop in your business model and implement in the company will make you more money.
1. Get Organized and Get Control
- Track everything you do
- Track every project
- Review and Measure results
- Decide what to change – only 1 thing at a time
- Compare results
2. Systems for Everything
- Immediately save $15K/yr
- Be in control using other people
- Reporting systems
- Automated Reports
- Schedule everything
3. Your Own Operations Manual
- Streamline what you do
- Refine processes – fewer mistakes, omissions, more efficient, can be planned, scheduled and measured
- Prepare for growth:
- Hiring, delegating, outsourcing
- Tools to grow into
4. Time Management Tools
- 18 month strategic plan – track to plan
- Implementation calendar – measure results
- Comprehensive calendar in Outlook/Google (actual & ideal)
- Automation – to save time, save money. Look at short term cost vs. long term gain.
5. Financial Planning Tools
- Excel, QuickBooks, Bookkeeper, Accountant, Payroll services
- Cost analysis of each decision
- Revenue analysis of each decision
- What If Scenarios in Excel before in your checkbook
6. Marketing Action Plans
- Integrated tasks (event, sale, post card campaign, telephone query, social media, etc)
- Aligned with Financial Plan
- Quantify expected results (leads, responses, qualified prospects, closes)
- Measure results – financial, time, return, quality of prospects/clients
7. Accountability Systems
- Schedule/Booking system
- An Assistant/Virtual Assistant
- Accountability Tools (paper, software, CDs, books)
- Board of Advisors
- Mastermind Teams
- Financial Reward Systems time and $$$
Let’s put systemization into practical terms. I know you’re questioning if it’s worth all the effort, change, chaos and risk to your current operation to implement new systems across the board. It is work. It is change. However, keep in mind, every change has the explicit measurable purpose of accelerating growth, increasing profits and maximizing the value of your business. When they can see the value that you know is in this business, they will be more receptive to paying what you think it’s worth!
Here are a few ideas for systemization in the core areas of your business.
|Departments and Disciplines||Range of Systems|
When you systematize every area of your business, you will:
- Gain control in ways you never thought possible
- Regain control in ways you thought you’d have to hire a large staff to do for you
- Eliminate mistakes
- Eliminate late and incomplete work
- Streamline work to get done easier and faster
- Never reinvent the wheel again
- Teach your team once and stop using your most valuable asset re-teaching them
- Organize every area of your business
- Open up your business for accelerated growth
- Gain easy access to the reports you need
- Make better decisions sooner and faster than you thought possible
- Have more time to lead instead of manage
- Radically reduce your risk running the business
- Drastically increase the value of the business
- Immediately be able to book multiple vacations this year
- Streamline how you run your business to add value and reduce stress
The real secret to all these systems is to:
- Implement tools that help you get the results in your business
- Use the systems and tools consistently, insist your team use them too. Institutionalize them into your corporate culture – even if you are a company of one.
- Get your business out of your head
- Track your results
- Periodically schedule a review to measure the impact in every area of your business.
Your attitude is the key to getting the results you want from these systems to achieve your exit goals.