As a business owner, you have worked hard to build a successful enterprise. But what happens when it’s time to step back or retire? Developing a succession plan is a critical part of ensuring the long-term success of your business, and that’s where Headwaters Strategic Succession Consulting can help. Here are just a few reasons why you should consider hiring Doug Cook at Headwaters to guide you through the succession planning process.

Tailored Solutions

At Headwaters, every business is considered unique, because it is. Doug works closely with each client to develop a customized succession plan that meets their specific needs and goals. Together, you’ll take a comprehensive approach that considers financial, legal, and emotional factors to ensure a successful transition of ownership. He’ll help you identify potential roadblocks and mitigate risks, so you can feel confident about your personal future, and in managing your transition successfully.

Minimize Risk

Succession planning can be a complex and risky process, and Headwaters can help you identify and mitigate those potential risks. Doug can help ensure that your business is prepared for any unforeseen events and that the transition of ownership is as smooth as possible. By working with Headwaters, you can reduce the chances of unexpected legal or financial issues arising down the road.

Focus on the Future

Headwaters helps business owners develop a long-term vision for their business and ensures that the succession plan supports that vision. He can help you think strategically about the future of your business and make decisions that align with your goals. Whether you are planning to sell your business, or transfer ownership to family members or employees, Doug can help you do so in a way that maximizes business value and minimizes disruption for you, and your buyer.

In summary, a succession plan is critical to ensuring the long-term success of your business; a key quality buyers look for. By working with Headwaters Strategic Succession Consulting, you can benefit from expertise, tailored solutions, risk mitigation, and focus on the future. Headwaters can help you navigate the complexities of succession planning and ensure a smooth transition of ownership. So why not take the first step and schedule a private call with Doug? We look forward to helping you secure your personal future, and the future your business.

Douglas Cook is a Certified Exit Planning Advisor (CEPA) and is the Senior Value Advisor at Headwaters Strategic Succession Consulting, LLC. He specializes in helping business owners formulate exit strategies while helping to increase the transferrable value of their companies.

Few will disagree that organizational structures are necessary. The need to break down metrics and deliverables, tasks, reporting avenues, strategies and communication by department is important for order and success. Structure allows information to easily flow up and down the organization. It is the most efficient means by which managers and executives have the ability to assess performance and make decisions that direct the company forward.

But structure can cause problems. Processes DON’T flow up and down the organization they flow THROUGH it. Therefore, the very act of creating an organizational structure also creates barriers to process flow and efficiencies. The end result is the engagement and satisfaction of employees and customers can be significantly impacted. Buzzwords describing these barriers include silos, channels or walls. They all indicate the propensity of departments to do what is most efficient within themselves, rather than taking a global view to accomplish what is best for the company, and its customers, overall.

An organization that is overly structured, or has an inability to overcome interdepartmental barriers looks like this:

1. Managers, rather than those directly involved in executing processes, do the mapping.
2. Decisions about minor deviations from a process (changes from what is written) follow rigid chains of command, needlessly involving many managers and department heads.  This may result in management’s unfair and inaccurate assessment that employees are incapable of taking their own initiatives.
3. To meet quotas, goals and timelines managers resort to forcing in more structure and greater demands that only serve to heighten tensions and reinforce barriers.  This eventually leads to burnout.
4.  Managers are perplexed about why they are having difficultly forming and maintaining interdepartmental collaboration.  
5. Employees say that what they think and observe doesn’t matter.

Enter Robust Continuous Improvement

Continuous improvement efforts must be robust enough to overcome inertia from the barriers that organizational structure inevitably creates.  Different than “breaking down barriers,” this work is about the process of elevating employees above silos, channels or walls. Employees must become capable of understanding the roles of others and of taking a global view. They must be supported to develop confidence in their collective observations, and then in their abilities to collaborate and solve problems as a team.

The true nature of such challenges can be difficult to see, and efforts to bolster collaboration among departments may settle haplessly around training initiatives or team building events. Including dinners, group activities or training may be helpful; however, rarely are these initiatives robust enough on their own to overcome existing barriers.

What is needed is a deliberate and focused continuous improvement initiative. One that is oriented to the purposes of inclusion, empowerment and trust. Designating several employees as champions and investing to educate them in continuous improvement principles and techniques will give your teams the tools and support needed to be proactive in understanding problems, processes and solutions.

Next, give employees CURRENT processes to review. Before tackling new challenges, they must first take ownership of what has already been implemented. Carefully select participants from different departments involved in executing selected processes. Sometimes the best candidates are ones who understand processes the least; however, be sure there is a sufficient balance of knowledge.

Once you are confident in the results your champions are getting, and have seen a real difference in the everyday collaboration among departments, your team will be ready to solve more complex issues. The good news is this will also be the point where you have achieved a balance between organizational structures and the internal innovation and teamwork required to realize stable, long-term growth.

Remember, one can drive organizational structure almost without pause so long as an internal system exists that can overcome the barriers that structure, by nature, creates.

Schedule a private call with Doug

Douglas Cook is a Certified Exit Planning Advisor (CEPA) and is the Senior Value Advisor at Headwaters Strategic Succession Consulting, LLC. He specializes in helping business owners formulate exit strategies while helping to increase the transferrable value of their companies.

Most businesses have fairly effective structures in place for dealing with day-to-day change. Whether this means visiting HR, receiving advice from a Supervisor, asking questions or offering feedback, the existing structures enable ongoing organizational transition.

As one can easily understand, however, a business ownership transition is not your typical day-to-day change. In many circumstances, it involves the complete uprooting and transplanting of an established organization into a different culture or paradigm, with a completely new set of goals, metrics and expectations. Existing structures are not set up for the purpose of dealing with one-time events of such magnitude, so expectations that employees utilize existing methods for change can quickly become counter-productive, if not completely nonviable. One component that renders ordinary methods inadequate is the confidentiality frequently required. Therefore, a well-planned and deliberate approach to change as it relates specifically to a company sale is required to achieve best results, and to help maximize the value of your company.

One specific “must have” criteria prospective buyers will evaluate is Owner Independence. This means that key employees, who will need to demonstrate their ability to manage the company, will also be the first of your personnel to experience the change. These individuals likely will be critically linked to the company sale and transition process throughout. Their involvement will be vastly different than anything they have experienced before…and adding to that complexity, they will need to help execute the sale while under the added stress of concurrently performing their existing duties.

Key employees understand the importance of your liquidity event as well as the urgency to get it right. In addition to possible anxiety about demonstrating their competence to a new ownership group, they also may become fearful of making mistakes that let you down, or may worry about not being able to maintain performance critical for the final valuation. To assist them, and you, here are four action steps to enhance the process.  

1) Involve Key Employees in the Preparation Process

Your staff will be able to add significant contributions due to their perspective, especially when developing the sales narrative. Ensure that they understand the ways in which the narrative is consistent with the story that the financial statements tell. This will help with consistency. Key employees need to be able to respond comfortably to questions potential buyers will undoubtedly ask. If they will be part of the presentation to investors, make sure there is a clear playbook, that they know their role, and that the presentation has been drilled repetitively until they are comfortable having to execute it.  Form a clear plan on how your broker will facilitate the conversation should something originate during an actual presentation that has not been considered beforehand. 

2) Maintain Performance Standards and Quality Deliverables

As mentioned, it is critical to final value that company performance be upheld. The focus upon sale preparation often shifts management attention and resources away from growth and other critical performance initiatives.  Ask yourself the following: What are the critical duties required to maintain performance? Can resources temporarily be re-assigned from less critical areas to support them? Can high-potential candidates for management development be identified who are capable of taking on additional projects during this time? Not everything can be delegated; however, building in temporary layers of support where possible can help key employees manage the added pressure more easily so they can be fully engaged.

3) Clarify Vision of Potential Buyer(s)

Rarely does an owner sell without asking prospective buyers what their vision for the company would be. Communicating this information with key employees early, and in as much detail as possible, helps them begin thinking with new paradigms and contemplating future expectations. Open dialogue can alleviate some of the anxiety that may be experienced during critical interactions. Overall, communication will greatly assist the team to mentally process the change. If feasible, set up a Q&A session with new ownership before closing so that vision and management structure can be openly discussed. Understanding whom they will report to, what resources are available for assistance, or even what the first board meeting will look like go a long way in building the confidence they will need to be successful.

4) Promote Communication

Welcome feedback from key employees throughout the process. Complex situations can unfold quickly, may be highly nuanced and may involve completely new circumstances prone to misunderstandings. Resolving confusions as they arise will smooth out the process and increase employee confidence in the outcomes.

Effort spent incorporating these steps into your transition not only supports key individuals who have helped build and grow your business, but also ensures that Owner Independence is well demonstrated. For you, Owner Independence is the predominant “bankable” operational quality your business must possess for a successful, lucrative and timely sale.

Schedule a private call with Doug

Douglas Cook is a Certified Exit Planning Advisor (CEPA) and is the Senior Value Advisor at Headwaters Strategic Succession Consulting, Llc. He specializes in helping business owners formulate exit strategies by helping to increase the transferrable value of their companies.