HOW TO ENSURE THAT YOUR BUSINESS WILL NOT GROW

by David Shavzin
“Procrastinate now, don’t put it off” ~ Ellen DeGeneres
Ah, procrastination! I have put off writing this blog for too long. But why?
“Never put off till tomorrow what may be done the day after tomorrow just as well.” ~ Mark Twain

Consequences
In business, decisions don’t get made and actions are not taken. Your business may continue to grow a bit each year, it may stagnate. Even with some growth, it will not achieve the revenue levels that you want. And, lack of action over time will seriously and negatively impact the value of your business when you are ready to sell and move on to your next activity. Your exit planning and succession planning never get started.
“Whatever a person’s comfort zone, they pay a huge price for staying inside it. It’s a shrunken world where ideas, opportunities, and new relationships can easily pass us by. Worst of all, procrastinators squander the most precious asset a human can have: time.” https://greatist.com/happiness/how-not-to-procrastinate-reason-procrastination     *** I encourage you to read this article!

Why DO We Procrastinate?
Scared? Scared of failure? Or, scared of Success?
“We are so scared of being judged that we look for every excuse to procrastinate.” ~ Erica Jong, Seducing the Demon: Writing for My Life.
Success can be scary. In business, it takes us up a level of complexity. More people depend on us – family, employees, suppliers. And there is a risk. If I am not successful, what will happen? Could I lose money, could my business get out of control? There is a risk in everything we do! Assessing, mitigating and preparing is key, that’s where risk gets reduced.

I Am Not One of Those Entrepreneurs
We tend to think that “entrepreneurs” create magic and that everything they touch turns into sales and profits, right? Isn’t that part of the silly perception we have of successful company founders? Especially the ones that grow so quickly?

The reality is that they:

• Gather good people around them.
• Work hard.
• Make big mistakes     – but learn from them.
• Manage risk     – they don’t jump blindly into seriously risky situations.
• Understand consequences and therefore lower the risk involved in what they are doing.

Their actions – their success – looks much riskier to us as outsiders because we don’t see their mistakes, the planning and the mitigation of risk.  

Not sure what to do?
Scarlett O’Hara’s line is often shortened to: “I can’t think about that right now. If I do, I’ll go crazy. I’ll think about that tomorrow.” But the next few words are: “But I must think about it. I must think about it.” ~ Margaret Mitchell, Gone with the Wind
“Lack of motivation for a task is a commonly given reason…Starting a task is the real motivator, rather than motivation needing to be present prior to beginning. Often just taking the first step, regardless of how small, can serve as an inducement for further action.”
https://www.k-state.edu/counseling/topics/career/procras.html


Just take the first step! No, it’s not closing your eyes and jumping into the pool. It is making sure there is water in the pool – but then, yes, jump in!

************************************************************************

More Reading on Procrastination
http://www.successconsciousness.com/guest_articles/procrastination.htm


David Shavzin, CMC
Shavzin and Associates, Inc.
Valuation, Succession / Exit Planning, Building Value for Sale
Atlanta, Georgia
770-329-5224
Our BLOG
LinkedIn
dshavzin@shavzinassociates.com
www.ShavzinAssociates.com


Thank you for visiting my blog.  I hope you enjoyed my point of view and would like to receive regular posts directly to your email inbox. Toward this end, put your contact information on my mailing list. Your feedback helps me continue to publish articles that you want to read. Your input is important to me so; please leave a comment.



Jim Weber, Managing Partner
ITB Partners
Jim.Weber@itbpartners.com
Author of: Fighting Alligators: Job Search Strategy For The New Normal

Current Assignments

1. COO- Atlanta-based Casual Dining Restaurant Company - New
2. Controller - Atlanta-based Consumer Products - Digital Company - Completed
3. Director of Biz Dev, Atlanta-based B2B Professional Services Company:    Completed
4. Payroll-Benefits Manager, Atlanta-based Retail Company:  Complete
5. Senior Accounting Manager – Atlanta-based Manufacturer. Complete
6. Controller - Atlanta-based Restaurant Company: New
7. Outplacement Assignment - Atlanta-based Manufacturer:  Complete

Get Out Of Your Comfort Zone!

For the past few weeks, this blog has featured guest bloggers including a series from David Shavzin, one of my colleagues, on succession and exit planning. However, that does not mean that I have been on vacation.  I have been very active, attending networking meetings, completing an important search, and recruiting Freelancers to join our Consulting Group, ITB Partners.  So, as I transition back to my role as the author of this blog, I thought it would be worthwhile to summarize a few of my most significant learning from the past few weeks.  I hope you will find some interesting items to consider as I did.

Tuesday, August 8, I attended the monthly meeting of the Business Executives Networking Group (BENG).   I met three people who were attending for the first time.  As meeting new job seekers is the primary benefit I seek from my association with BENG.

This was a productive event.  We scheduled follow-up meetings to discuss their career interests and how I might be helpful. The meeting agenda included a presenter from one of the nation’s premier outplacement firms.  Naturally, his presentation was about the current state of job search in this country.  After a brief overview of the outplacement industry and his company’s model, he facilitated a question and answer session from the group.  My major takeaway from the meeting can be summarized in the following four bullet points.

• Age discrimination is real
• Networking is King
• Changing industry sectors requires a good contact
• Jobscan.co is worth a look

The first three bullets will be familiar to you as I have frequently posted on these issues.  To summarize:  Yes, age discrimination exists, especially with major companies.  It is a challenge to overcome, however, it is not fatal.  Networking is still the predominate means to a new job, so keep at it!  Changing industry sectors is easier if one has good networking connections into the target industry.  My other major takeaway was that Jobscan.co is worth further research.  This was the first I had heard about Jobscan.co so I made a note to learn more.

My research into Jobscan.co revealed that it is an affordable alternative to a professional outplacement program.  Their tagline is “Providing resources to help you land your perfect job from beginning to end."  Jobscan.co  provides resources to help subscribers navigate job search including, how to write cover letters; how to write a resume; and how to prepare for a job interview.  Additionally, jobscan.co has a program to help you better understand applicant tracking systems.  Jobscan.co offers three basic programs each with a different level of services. The basic program called "Fee Forever” is just that, a limited number of services for free. Their most popular program is “The first month free” with the next three months priced at $89.95.  The third program is full service for $49.95 per month.  My impression is that this that most job seekers should consider Jobscan.co as the cost of their services seems fairly reasonable.

This week Wednesday, seven members of our consulting group, ITB Partners attended a meeting with a local chapter of Institute of Management Consultants (IMC).  One of our partners is the immediate past president of IMC.  He was instrumental in recruiting our consultants to attend the meeting.  My interest was to understand the value proposition of IMC, especially its potential to help build the professional skills of our consultants.

The Atlanta Chapter is part of the US Affiliate of IMC which operates under the umbrella of The International Council of Management Consulting Institutes, (ICMCI) based in Zurich Switzerland.  Since 1987 ICMCI has been the professional body worldwide for management consultants. ^[1]

It exists to:

• Elevate the standards of management consultants worldwide
• Increase the acceptance and respect of the management consulting profession
• Increase the international and regional profile of management consulting
• Improve the process of certification throughout the world
• Provide a forum for national certifying bodies of management consultants
• Prepare and promulgate Standards for management consulting to be adopted internationally

This meeting was primarily a recruiting effort to entice more independent management consultants to join their association. As one would expect the presentation was heavy on the benefits of each joining IMC, however, we did enjoy a free lunch and a presentation by a LinkedIn guru.  The theme of his presentation was “Leveraging your Brand using LinkedIn.”  I must admit, I did gain a few tidbits of useful information from his presentation.

IMC offers to credential for its members using online testing and an oral evaluation by a panel of members.   One of the most important aspects of this association is their code of ethics.  It is most impressive!  I plan to adopt those standards for our consulting group.  Overall, my take on the IMC group is that they are more about networking and providing referrals to their members than they are about building professional skills.  I am fine with that, as providing a base of support for the Independent Consultant is a critical component for success.  There is ample opportunity for continuing professional development through other sources.

In summary, these two events reinforce my belief that if you are looking for a new job or building your career, advancement requires growth.  One cannot grow unless you get out of your comfort zone and expose yourself to new situations.  Become active meeting new people and learning about new products.

Thank you for visiting my blog.  I hope you enjoyed my point of view and would like to receive regular posts directly to your email inbox. Toward this end, put your contact information on my mailing list.Your feedback helps me continue to publish articles that you want to read. Your input is important to me so; please leave a comment.

Jim Weber, Managing Partner

ITB Partners

Author of: Fighting Alligators: Job Search Strategy For The New Normal

JimWeber@NewCenturyDynamics.com

Current Assignments

1. COO- Atlanta-based Casual Dining Restaurant Company - New

2. Controller - Atlanta-based Consumer Products - Digital Company - Completed

3. Director of Biz Dev, Atlanta-based B2B Professional Services Company:    Completed

4. Payroll-Benefits Manager, Atlanta-based Retail Company:  Complete

5. Senior Accounting Manager – Atlanta-based Manufacturer. Complete

6. Controller - Atlanta-based Restaurant Company: New

7. Outplacement Assignment - Atlanta-based Manufacturer:  Complete

Business Exit Structure, comes in many flavors

by David Shavzin
Business Exit Structure is the fourth high-level step I discuss when speaking on succession/exit planning. 












My last three blogs covered the first three steps: Step 1: Exit Planning / Succession Planning is a TEAM SPORT; Step 2: Knowing Your Business Value; Step 3: Building Transferable Value. The fourth step, Business Exit Structure, comes in many flavors.



How Can I Leave Thee – Let Me Count the Ways

It is not simply a matter of handing over the business and getting a check for the full amount on your way to the islands for the rest of your life. Despite what you hear, it rarely happens that way. It may be a payout over time, the amount may be tied to future revenue targets, it may require your continued involvement for a period of time.

You may simply not be ready to accept offers that are put in front of you, requiring you to stay in the business longer than you would like.

A few options to consider for your business exit structure:

• Sell to a 3rd Party: An investor or someone looking for a business to run and grow.
• Sell to Family: Could be ideal, could be complex and personally challenging!
• Sell to Employees: Current staff knows the business, employees keep their jobs.
• New Employee/Acquirer: Bring someone in, teach the business, agree to sell at a certain date.
• Retain Ownership: Sell majority ownership, but keep an income stream over time.
• Shut the Doors: Liquidate, perhaps the only choice due to a crisis or lack of planning.
• Strategic Sale: Find a competitor who may pay more because of various cost savings.
• The Two-Step: Merge with a competitor as a first step and have a plan for a buyout over time.
• Split in Two: Don’t want to completely retire? Is there a product or service you enjoy and would want to keep?
• Die – No Really!: Want to work forever? Ok, but you still need to plan.


The Bottom Line on Business Exit Structure

There are dozens of formulas for business exit structure. Start planning early, build your advisory team and outline at least a target exit scenario so you have something to work toward. Discuss the pros and cons of each possible scenario. You can always adjust along the way, but having an initial plan will help bring you and your team together toward common goals.

A successful transition takes time. The earlier you start, the more flexibility and negotiating power you will have for your business exit structure.

********************************************************************
More Reading:
Step 1: Exit Planning / Succession Planning is a TEAM SPORT
Step 2: Knowing Your Business Value
Step 3: Building Transferable Value
********************************************************************
David Shavzin, CMC
Shavzin and Associates, Inc.
Valuation, Succession / Exit Planning, Building Value for Sale
Atlanta, Georgia
770-329-5224
Our BLOG
LinkedIn
dshavzin@shavzinassociates.com
www.ShavzinAssociates.com


Thank you for visiting my blog.  I hope you enjoyed my point of view and would like to receive regular posts directly to your email inbox. Toward this end, put your contact information on my mailing list.Your feedback helps me continue to publish articles that you want to read. Your input is important to me so; please leave a comment.

Jim Weber, President

New Century Dynamics Executive Search

Author of: Fighting Alligators: Job Search Strategy For The New Normal

JimWeber@NewCenturyDynamics.com

Current Assignments

1. COO- Atlanta-based Casual Dining Restaurant Company - New

2. Controller - Atlanta-based Consumer Products - Digital Company - Completed

3. Director of Biz Dev, Atlanta-based B2B Professional Services Company:    Completed

4. Payroll-Benefits Manager, Atlanta-based Retail Company:  Complete

5. Senior Accounting Manager – Atlanta-based Manufacturer. Complete

6. Controller - Atlanta-based Restaurant Company: New

7. Outplacement Assignment - Atlanta-based Manufacturer:  Complete

Exit / Succession Planning: Transferable Value and Value Drivers

Guest Blog Post by David Shavzin;  Partner, ITB Partners

A laser focus on key business TRANSFERABLE Value Drivers will maximize your exit. When I speak on exit and succession planning, I talk about four high-level steps. My last two blogs covered the first two steps: Step 1: Exit Planning / Succession Planning is a TEAM SPORT and Step 2: Knowing Your Business Value and Step 4: Business Exit Options.







Step 3: Understanding TRANSFERABLE Value and Value Drivers
First, let’s discuss Transferable Value

I usually put it this way: “What would happen if you left your business for three months, headed down to an island with absolutely no way to communicate?”
If you get back and the business is humming along well, even thriving, you may well be on your way to significant transferable value.

If sales didn’t happen, if bills were not paid, if your products or services were not delivered, if 2 key employees quit and if the leaking roof completely fell in – because you were not there – you probably don’t have much transferable value.

The company’s dependence on you for success limits Transferable Value to a buyer. A buyer does not want to see a significant amount of knowledge walk out the door upon purchasing your business. If that’s the case, they will pay you a lot less than you want for it.
Perhaps the extremes of 1) or 2) above don’t apply to you, but the reality is that most businesses have a long way to go to optimize transferable value.
The big goal: make yourself irrelevant to the business. “But, but…” I hear you start to protest. Get over it! If your goal is to have the money that you need/want for yourself and your family, you need to raise your business like a child, preparing it to live life on its own…without you.

Now, the Top Ten Drivers of Transferable Value
These are not necessarily in priority order and should all be addressed as you work on growth, succession, and exit. Develop a plan that truly addresses these ten items, and start working the plan now:
• Your revenue will improve immediately.
• You will feel better and enjoy the business.
• Your value will start to grow quickly.

1. Sustainable, Recurring Revenue.
2. Written Business Processes: update them regularly, train to them regularly. Repeatable, consistent operating systems drive the customer experience and sustainable cash flow.
3. A Technology infrastructure that supports your plan and value drivers, while staying current!
4. Management Team and senior staff who are trained and motivated. Make sure that your employees are Knowledgeable and Engaged.
5. Sustainable, Competitive Advantage: Is there something that is truly different about you? If not, find it! Don’t be a commodity and don’t tell me “we have great customer service”!
6. Scalability: are you ready to take on a new customer that adds 50% to your revenue? 100%?
7. Diversified Customer Base: Is one customer more than 20% of your revenue? And how often do customers leave you?
8. Customer Experience: Do you truly know how your customers experience your products and services?
9. Financial Performance: Sustainable, Growing Cash Flow and Financial Controls.
10. Written Growth Plan

The Bottom Line on Transferable Value
The business needs to thrive – without you! Develop and work a plan that addresses the top ten value drivers. Start today, measure your progress and adjust your tactics if you get off track on your exit planning.

********************************************************************
More Reading:
Step 1: Exit Planning / Succession Planning is a TEAM SPORT
Step 2: Knowing Your Business Value
Step 4: Business Exit Options.
Transferable Business Value and What Drives It:
http://www.forbes.com/sites/johnbrown/2016/06/30/transferable-business-value-and-what-drives-it/#22c215fe7241
********************************************************************
David Shavzin, CMC
Partner, ITB Partners
Shavzin and Associates, Inc.
Valuation, Succession Planning / Exit Planning, Building Value for Sale
Atlanta, Georgia
770-329-5224


Thank you for visiting my blog.  I hope you enjoyed my point of view and would like to receive regular posts directly to your email inbox. Toward this end, put your contact information on my mailing list.Your feedback helps me continue to publish articles that you want to read. Your input is important to me so; please leave a comment.

Jim Weber, President

New Century Dynamics Executive Search

Author of: Fighting Alligators: Job Search Strategy For The New Normal

JimWeber@NewCenturyDynamics.com

Current Assignments

1. COO- Atlanta-based Casual Dining Restaurant Company - New

2. Controller - Atlanta-based Consumer Products - Digital Company - Offer Accepted

3. Director of Biz Dev, Atlanta-based B2B Professional Services Company:    Completed

4. Payroll-Benefits Manager, Atlanta-based Retail Company:  Complete

5. Senior Accounting Manager – Atlanta-based Manufacturer. Complete

6. Controller - Atlanta-based Restaurant Company: New

7. Outplacement Assignment - Atlanta-based Manufacturer:  Complete