We believe that most Exit Planning usually starts too late in the game to change existing circumstances and is simply structuring the best deal to transfer company ownership, given the available options at the end of the game. Exiting a business is too important emotionally and financially to leave it to chance. It must be a driving purpose of the game. Integrated Exit Planning is our process to mange the circumstances and expand the potential options for an eventual ownership transition. It involves 5 levels of inter-related planning to increase enterprise value and, coincidentally, to develop a better managed and better performing business between now and then. The earlier you start the process, the greater the impact. Most businesses are only consciously doing the first 1 or 2 levels of planning; therefore, we believe they are missing the opportunity for greater value and accepting greater risk.
The 5 levels of Integrated Exit Planning:
- Business Process Planning is about getting work done with as little waste as possible to better serve customers and maximize profit potential. It is about execution.
- Strategic Planning is about optimal approaches to better meeting customer needs versus the competition. It includes Mission, Vision, Values, SWOT, Value Proposition, Business Model Development, Branding, Strategy Development, Cultural change, Implementation, etc. It is about doing the right things.
- Personal Strategic Planning is about what the business owner truly wants in their life outside of the business and determining how the business serves those goals. This includes a deep understanding of who they are beyond their “business persona” by coming to understand their personal values, work / life balance, overall life goals, important relationships, personal legacy, and greater purpose beyond building a successful company. It is about your own happiness and success.
- Enterprise Strategic Planning is about building the business to support the outcomes of the lower levels of planning so that the business reduces dependence on the owner’s direct operational involvement with the day to day, and increases the stability of predictable, recurring, and growing cash flow. This requires a focus on the drivers of value creation including, building a Leadership Team, management alignment, performance management, capturing organizational knowledge, building IP, branding, risk management, reducing customer and vendor concentration, creating barriers to entry, developing and documenting systems and process, creating a culture of accountability, developing strong legal and financial record keeping and analysis. It is about creating predictable recurring cash flow to build enterprise value.
- Exit Planning, in the context of Integrated Exit Planning, becomes a process that evolves over time, in an intentional way, driven by your needs and the desires, as a direct result of the circumstances you have created. It involves a team of advisers to structure the deal you have worked for and on your timetable. It is about transferring ownership in the way that best serves you, as you deliberately move on to great things in the next chapter of your life’s story.
Contact us to explore how you can implement Integrated Exit Planning for your business.