The Institute for Owner Success launched the educational seminar series Business Value Drivers to Long-Term Generational Wealth series. The first seminar in the series explored
6 concrete strategies to help businesses avoid the consequences of being too owner-centric
If your business cannot function smoothly while you are away for an extended period of time, the value is greatly diminished – both now and to potential buyers in the future.
The most effective business leadership focuses on including management and employees in goals, implementation and decision-making. Test to see if your business is too owner-centric by taking an extended vacation and seeing how your employees, business and customers respond.
Tips business owners can, and should, implement NOW…
- Document your standard procedures and processes step-by-step and train your employees to these instructions.
- Key employees should assist in this documentation, which also encourages consensus.
- Allowing employees to be self-directed by following written procedures builds a positive, proactive culture.
- Delegate responsibilities to an individual(s) with decision-making authority – empower a second-in-command.
- Companies with an owner who calls all the shots are not as attractive or valuable to potential buyers.
- Get your team involved in running the business by the numbers.
- Someone in addition to the owner needs to know the company’s most important goals and targets…and to understand how to help achieve those results.
- Don’t worry … assigning responsibility for key metrics is not full transparency. Nobody needs to know salaries or other confidential information.
- The deeper into the company, the more “operational” and less “financial” these numbers become.
- Establish a “cadence of accountability” around the key metrics.
- Regularly and routinely check the score during the month. Once the month has ended, it’s too late – you can’t change history!
- Use scoreboards to keep each department’s targets and results front of mind.
- Don’t let denial spoil your legacy – embrace succession planning.
- Advanced planning guarantees that you have employees on hand, ready and waiting to fill new roles when you are ready to sell the business.
- Take advantage of the time between the announcement and the acceptance of the job so new leadership can address as many needs as possible prior to your exit.
- Prepare for retirement like you would for a new career.
- Develop a strategy – do you want to work fewer hours, try a new career or business, learn new skills and further your education, give back through volunteering…?
- Determine the best way to manage your time. Take charge of your schedule; become time conscious. Even in retirement, you will want to get the most out of each day.
The experts of the Institute for Owner success are available for individual consulting: [email protected].
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