We can say with certainty that, at some stage in the future, you will not be running your business. So whether you plan to sell or pass it to family, now is the time to ensure that your business isn’t all about you. The latest research of 14,000 companies from the Value Builder Score* provides two key factors that are linked to the probability of getting an offer for your business when its time to leave.
You’re almost twice as likely to get an offer if your business can survive the “walk under a bus” test (or a “take a long holiday” test, which sounds more appealing!)
Ask yourself, if you are out of action for three months and unable to work, would your business keep running smoothly? The more your staff and customers need you, the less valuable your company will be to a buyer or even a family member (they know more than most how the business relies on you!). Try the following:
- Spend less time at the office. Start by not working evenings or weekends, and don’t reply if employees call. Once they get the picture, the best ones will start making more decisions independently;
- Keep a list of questions asked by staff, especially after your absence.
These will expose your weakest employees, the ones that need training (and what that should be) or that need to find another job.
As for you, it might come as a shock to find out how much your business has become such an essential part of you. However if you’re going to leave your business one day, you need to look at it as a way of making economic money, not as something that defines who you are.
Companies with a management team (as opposed to a sole manager) receive offers at almost twice the value
If you don’t have a management team, hiring a second-in-command (SIC) is a good first move. A SIC can help you balance the demands of running your company and will advance your targeted exit time.
Here’s a four-step plan for hiring a SIC, and thanks to advice from Silicon-Valley-based Bob Sutton, author of Good Boss, Bad Boss for these views.
- Identify someone internally. “The research is clear,” says Sutton. “Unless things are totally screwed up, internal candidates have a strong tendency to outperform external leaders.”
- Give your SIC prospect(s) a special project. One that allows them to demonstrate their leadership skills to you and the rest of your team. If your candidate or one of your candidates excel, it will be clear to your team why he or she was selected.
- Communicate your choice. If you pick a SIC from an internal pool, explain your choice to the rest of your team. At the same time, wrap your arms around those you passed over and make it clear how much you value their contribution.
- Shift from manager to coach. “The transition from manager to coach is a gradual evolution where the goal is to ask more questions, spend more time listening, and spend less time talking and directing,” says Sutton.
Uscita Solutions have produced a guide which covers “Your Business Without You” along with 7 other key drivers that can improve the value of your business. To download your free copy of this guide, please click on the link below;
Alternatively, if you would like to speak with us, please call 01606 535 020.