Why Your Business Needs A Succession And/Or Exit Plan

While reading the September 2019 edition of INC Magazine, I was surprised to learn that a small percentage (21%) of the companies in the 2019 INC 5000 have list succession plans, and an even smaller percentage (12%), have a plan but have not identified successors.   Therefore, two-thirds of the fastest growing private companies in America are at risk of a major disastrous, disruptive event.  While the INC 5000 companies have grown extraordinarily fast, in most other respects they are typical of the general private business landscape in the USA, and probably the world.  I’m guessing that at least two-thirds of you don’t have a succession plan.  That adds up to a lot of potential clients for me and my ActionCOACH colleagues.

Why do you need a succession plan?  There are numerous reasons, some of which include:

  • As mentioned in my blog Why You Should Prepare Your Business To Be Sold dated 10/23/2018, A business that is designed and built for the owner’s exit will provide protection to the business’ team and the owner’s family. There are too many instances of businesses that failed after an owner’s disability or death.  The potential for destruction of value, jobs and fortunes is reason enough for you to prepare your business for your exit.”
  • A long time ago, a very wise insurance broker explained that a business owner in their forties or fifties is eight times more likely to become disabled than to pass away before retiring.
  • A business that is prepared for succession and owner exit is a stronger business.
  • If at some time in the future you sell your business to outside potential buyers, they will be attracted by the increased potential to retain the company’s human capital.
  • If at some time in the future you sell the company to your employees, the key employees are more likely to remain. The result is a company with a much greater potential for longevity and ability to retire the financing used to purchase the business.
  • For all these reasons a business that is prepared for succession and owner exit is a more profitable, valuable business.

One of the main focuses of the ActionCOACH coaching process is planning.  Among the many types of plans our clients have is a succession plan and, depending upon their age, an exit plan.  If you wish to protect your business should you become incapacitated or prepare your business for your exit and earn more money until you decide it is time to exit, my colleagues and I are ready to assist you.

The Golf Ball and How Nike Missed The Boat

Leading up to the 2000 US Open tournament, virtually all the golf balls in use, especially by professionals, were of wound construction.  Top of the line balls had balata covers which better golfers beat to shreds.  Tour pros routinely used six balls per round.  The exception was a Titleist ball with an Elastomer cover, the Titleist Professional, which closely resembled the Tour Balata, but with a more resilient cover.

At the beginning of the 2000 season, Tiger Woods, who was a Nike athlete was using the Titleist Professional ball.  Nike in partnership with Bridgestone Golf was prototyping a ball called the Nike Tour Accuracy, which Tiger call “My Ball”, planned for release at the beginning of the 2001 PGA Tour season.  In early 2000 Tiger had narrowed the prototype field down to two versions.  After some additional testing, the final version of the ball was brought to Hamburg for testing during practice rounds at the 2000 Deutsche Bank-SAP Open.  In a wind-swept heavy rain, Tiger hit a drive from the first tee with the Titleist Professional ball that the wind caught and push into the rough.  Tiger next hit the Nike prototype on the same starting line. The Nike ball moved about five yards in the wind and stopped in the middle of the fairway.  In May 2000, Tiger switched to the Nike ball, ahead of the original schedule.  Starting with the 2000 US Open, Tiger won his “Tiger Slam” with “My Ball” and changed the golf ball industry in the process.

What does this have to do with business?  During that period, Tiger Woods was the most influential golfer in the world.  That influence resulted in a complete move away from wound golf balls to the new two- and three-piece balls.  To quote Tiger;

“I won four majors with that ball, and the rest is history because wound-ball technology is gone.  Everyone switched.”

Unfortunately, Nike was totally unprepared to capitalize on Tiger’s success using the Nike Tour Accuracy golf ball.  Kel Devlin, Nike’s global director of sports marketing still ponders the circumstances around the ball.

“If we had enough capacity, and I could have gotten the sports marketing folks and Phil [Knight] to buy into the bigger program … if we’d had the ball available to any Tour player who wanted it four weeks earlier than we did …”

Result?  Nike is no longer in the golf ball business and Titleist continues as the far and away best-selling brand of golf balls.

So, I ask you the same question I ask of most of my clients when they are about to begin a new strategy or marketing program,

“What if this works?”

When you do something new, do you prepare for success?  If you are launching a new product or item, do you arrange for timely delivery of inventory on a just-in-time basis?  If you are launching a new service, has your team been fully trained to consistently deliver the service up to the quality you require, while continuing to support (not losing) your existing loyal clients?  To successfully scale your business, it is essential to ask these questions and many more as part of your planning and implementation process.

My ActionCOACH colleagues and I are expert at assisting clients just like you in the development of new products and services and business growth.

*Based on an article in the June 2019 edition of Golf Magazine.

What Can We Learn About Business from Arthur Rubinstein – What Are Your Business Superpowers?

During a recent conversation about personal and business superpowers, I recalled something I read many years ago about one of the twentieth centuries greatest classical pianists, Arthur Rubinstein (1887 – 1982).  Although I am almost certain I read about the one of his many superpowers that is the basis of this blog in his 1980 autobiography “My Many Years”,  (Last night, I found my copy of the book, it is 626 pages) I was not able to find the exact reference I was looking for. One of Arthur Rubinstein’s amazing superpowers was the ability to play 100 distinct volumes, from pianississimo (very very soft, a whisper) to fortississimo (very very loud, yelling), certainly a necessary superpower for a world class pianist.  Add to that other essential superpowers such as perfect pitch, a photographic memory that enabled him to rapidly memorize musical scores, and a great passion for the music of multiple composers, and you have a pianist who was recognized as one of the greatest, if not the greatest of the twentieth century. Given all that natural talent, Rubinstein was a tremendous success from his early performances in 1904 through the 1920’s.  However, in 1934 he withdrew from concert life for several months to begin a period of intensive study and practice.  He stated that he had neglected his technique in his early years, relying instead on his natural talents. There are two very important business lessons here:
  • What Are Your Superpowers? – As a business owner or executive, identify your natural talents, abilities and developed skills that distinguish and elevate you from others in your industry. Dig deep and periodically repeat the identification process.  Many of us have both business relevant and irrelevant superpowers, so make sure you identify those talents that give you your competitive advantage.  Identify the talents that enhance your ability to excel in your current and future roles, and talents that enable you to bring superior value to your business, community and the world.
  • Continually Enhance Your Natural Superpowers – Just like Arthur Rubinstein, your natural talent can get you far, but not as far as possible. As is often stated by my colleagues at ActionCOACH and many other mentors and speakers, you’ve got to “Learn More to Earn More”.  Don’t rest on your laurels.  Continually learn, improve and practice, some of your competitors are doing exactly that.
My colleagues and I are uniquely positioned to assist you in identifying and enhancing your business superpowers.  Give us a call.

2019 Business Excellence Forum – Blinding Flashes of the Obvious Part 4

Our next speaker was the amazing Sheri Riley, author of “Exponential Living – Stop Spending 100% of Your Time on 10% of Who You Are” Her presentation included many BFOs:
  • What will you give up to grow? If you don’t give things up, you limit your capacity to grow.
  • Personal development fuels professional growth
  • Our skills and talents can take us to levels of success that our character can’t sustain
  • Personal development is LEADERSHIP
img_2933-for-blog Her book includes a road map to the title subject, Exponential Living img_2939-for-blog The balance of Sheri’s presentation was about the five steps to Living Your Power
  1. Perspective – “I don’t know” is not the truth, it clouds your vision
    • “Be realistic with your goals and unrealistic with your thinking and your effort.” – Paul Martinelli, President, The John Maxwell Team
  2. Ownership – What are you focused on?
    • When looking at peoples to do lists it was found that
      • People didn’t remember why 1/3 of the items were on their lists
      • 1/3 of the items were for others, and
      • 1/3 were chronologically out of order
    • Most suffered from FOMO – Fear Of Missing Out
  3. Wisdom – What is your plan?
    • Determine your 1 to 3 MOST important NEXT steps
    • Ask yourself, “Am I chasing opportunities that are actually distractions?
  4. Engagement – What adjustments do you need to make to implement?
    • Presence is not enough, being present is the key
    • Multi-tasking is a lie!
  5. Reward – How will you remain consistent?
    • Don’t walk away from a goal because the plan isn’t working
    • Be committed to the goal, be committed to consistency, be flexible with the plan
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  • Broaden our definition of success
  • Eliminate the fear of success
img_2954-for-blog Brad Sugars returned to the stage as our final speaker of BEF.  He discussed reaching critical mass:
  • You must grow into your role and goal
  • Wisdom comes from the application of knowledge
  • Commitment – with bacon & eggs
    • The chicken is a participant
    • The pig is committed!
  • The concept of BE x DO = HAVE
    • Applies to a person
    • Applies to a couple
    • Applies to a team
    • Applies to a company
At the awards dinner the evening of the second day, one of the award winners had a different spin on one of our PowerPoint slides: Instead of You have to learn more to earn more, It’s not about what you earn, it’s about who you become. If you wish to discuss any of the BFOs or concepts presented in this 4-part series, my colleagues and I are just a phone call, email to website inquiry away.  You simply have to take ACTION!

2019 Business Excellence Forum – Blinding Flashes of the Obvious Part 3

The second day of BEF kicked off with Michael Losier, author of “Law of Attraction – The Science of Attracting More of What You Want and Less of What You Don’t.”  Among the many BFOs were:
  • Contrast – The brief observation of what you don’t want will bring clarity to what you do want
  • The Law of Attraction is like a Google search, refine the search until you find what you are looking for.
  • To invoke the Law of Attraction, refine your Words->Thoughts->Vibes->Results
Our next speaker was Stephen Hightower, President & CEO of Hightower Petroleum Co.  Mr. Hightower was profiled in CNBC’s “Blue Collar Millionaires”, he went from cleaning toilets in his parent’s janitorial business to founding a multi-million-dollar oil company.  One of his big breaks occurred when his company was chosen to provide all the fuel that is put into new cars coming off GM’s production line.  At the time, he didn’t have the credit nor the supply chain to satisfy the contract.  In fact, he needed to triple his capacity.  His search for credit and supply led him to the following BFO:
  • “If the opportunity is big enough, you can find a supplier to support it.”
Having the right relationships has enabled his company to now supply the fuel for most of the cars produced in North America. The additional BFO’s from Mr. Hightower’s presentation included:
  • As long as you don’t die, you have the opportunity to do something different
  • “Exposure gives you the ability to see what is possible.”
  • “90 % of my customers are being called upon by someone else.  100% of my customers were once customers of someone else.”
This last BFO from Stephen Hightower was so powerful and valuable that it covered my BEF investment several time over.  We all have competitors, thus, to succeed for the long haul, we must CONTINUALLY exceed our customer’s rising expectations. Stay tuned for the next installment of BFOs from the 2019 BEF.

2019 Business Excellence Forum – Blinding Flashes of the Obvious Part 2

Continuing with Brad Sugars’ presentation.  Brad listed some of his favorite 5 Ways strategies (in his order of preference):
  • Margin:
    • Don’t just raise prices, continually educate your customers and team as to your value proposition
    • Don’t discount – instead of giving away cash, give away value (make it special)
  • Conversion Rate:
    • Training, training, training
    • Make a benefit list – the top reasons customers should buy
    • “you can’t outsell your competitors if you don’t know them.” – Learn as much as you can about what they do well and not so well
    • Flowchart your sales process
    • Use Critical Non-Essentials (CNEs)
  • Average $ Sale:
    • Training, training, training
    • A/B/C/D customers – guide your customers, or send some of them to your competition
  • Number of Transactions:
    • Constantly build your database
    • Rebooking
    • VIP programs
    • Special offers & events
  • Lead Generation:
    • Video testimonials
    • Professionally built website
“Marketing is the life-blood of the business.” Our next speaker was the very inspirational Dr. Jen Welter.  Dr. Welter is the first female coach in the NFL.  She coached the inside linebackers for the NFL’s Arizona Cardinals.  A few key BFOs are:
  • Don’t live life looking in the rearview mirror
  • Be defined by what you do, not by what people are willing to pay you
  • “You are the producer, director, and lead actor of your life.”
  • “Why fit in when you can stand out?”
  • People listen when you whisper
We finished day one with a presentation from Richard Maloney, Founder and CEO of Engage & Grow Global.  Richard’s presentation revolved around the subject of employee engagement; its definition, costs, and its cure.  Among the many, many BFOs presented are the following highlights:
  • “Nobody cares how much you know until they know how much you care.” – Theodore Roosevelt
  • Definitions of the different levels of employee engagement
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  • According to a 2017 Gallup survey of companies in the US 69% of employees were disengaged (a 1% improvement from 2016)
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  • Disengagement looks like this
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  • And a Gallup poll concluded that an engaged workforce yields tremendous benefits
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  • Richard outlined the 6 Steps to employee engagement
img_2913-for-blog A few more key BFOs
  • “If you don’t measure, you lose treasure.”
  • Resolve disagreements within your company quickly – get the “splinters” out before they become infected
  • A great question to regularly ask your team is – “What around here needs to improve to become number one in our industry?”
Stay tuned for the next installment of BFOs from the 2019 BEF.

2019 Business Excellence Forum – Blinding Flashes of the Obvious – Part 1

For the fourth year in a row, the Business Excellence Forum (BEF) grew and exceeded the previous years in attendance, presenters and content.  This year there were more than 700 business owners, executives, team members and business coaches in attendance in Charleston, SC.  With that many attendees, there was an abundance of formal and informal exchanges of ideas, strategies, success stories and best practices. This year’s forum had an extensive list of keynote speakers whose presentations yielded many Blinding Flashes of the Obvious (BFOs) and new ways of looking at things.  The following are some of the BFOs that struck a chord with me, all of which will enhance the value I bring to my clients.  I am sure that some of these will have a similar effect on you. The event began with Dr. Mark Thompson and Dr. Bonita Thompson, authors of “Admired – 21 Ways to Double Your Value”.  Their presentation was about “Being The Most Admired Brand.”   They presented the five factors needed to be an admired brand:
  1. Who do you admire?
    • We admire people with the same values as us
    • We all need “Power Partners” – mentors
  2. Productive PARANOIA
    • Steve Jobs 1.0 – was fired from Apple. At that time, he was ambitious, arrogant, and lacked humility
    • Steve Jobs 2.0 – re-tooled himself and built Apple into one of the most valuable companies in the world
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  1. Value-Creators – If your house burned down, would you:
    • Rebuild the same House?
    • Using the same Process?
    • With the same Team?
    • What about your business? Does your business create Value?
  2. Never-ending Mission – four parts
    • BHAGs – Big Hairy Audacious Goals
    • OKR – Objectives and Key Results
    • Simplicity
    • Urgency – Creates Learning & Growth
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  1. Deliberate Practice – 6 Parts
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  1. Redefine Success – What is your definition of Success?
img_2846-for-blog They concluded with the secret to passionate growth: img_2849-for-blog And Number 7 Gratitude. Our next speaker was ActionCOACH Chairman and Founder, Brad Sugars.  Under the often-repeated mantra of going back to basics, Brad presented some reminders and updates to the Six Steps to Massive Results seminar.  Highlights include:
  • Don’t fall in love with your product or service – break out of your rut and continually improve and innovate
  • It is no use building your marketing if you can’t keep the customers – make sure you can consistently deliver
  • With the internet and social media, marketing has shifted toward labor, away from spend
  • In the ActionCOACH concept of Test & Measure – testing has become extremely easy because of all the statistics that are available
  • Use the ActionCOACH 5 Way Formula backwards, from Profit up – 5 years, 4 years, …
Stay tuned for the next installment of BFOs from the 2019 BEF.

You Can’t Do It All

The cover story in the current (January-February 2019) edition of Entrepreneur Magazine is a profile of Michael Strahan (Link to the article).  Not being a daytime TV viewer, or a NY Giants fan, I was not very familiar with him.  Until I read the article, I was almost totally unaware of Michael Strahan’s many accomplishments after retiring from the National Football League.  There are a few things we can learn from his business career after his playing days were behind him. It Is What It Is Until It Isn’t – Not unlike many pro athletes, Strahan had no plan what he would do once the game ended for him.  Nonetheless, he piled up an impressive playing record; fifteen seasons (the average NFL playing career is only 3 years).  That level of longevity speaks to a dedication to be the best defensive end he could be.  He gave his all to his football career until it was over.  Are you totally engaged in your business? Deal With Pressure – After the NFL, Strahan went into sportscasting.  Leaving football introduced the concern and possibility the he would “suck” (his word) at something.  “You don’t want to be the weak link.” He said.  He realized that facing a 350-pound opponent who was trying to smash his head in was more pressure than “shaking a dude’s hand and asking him a few questions.”  He put the pressure of a new role into perspective.  Are you putting the day-to-day pressure you face in your business into perspective? Build Your Team – Along the way, Strahan, influenced by his career in professional football, a team sport, assembled a very effective team.  As he said in the article:

“I understand that it’s a bigger team than just you on the camera.  The most important people are the ones behind the camera.”  He went on to say, “You understand how important the support system is in sports, and that has carried over to me in business.  Because there’s nothing worse than feeling that you do a job no one values.  Each job is important – I don’t care if you’re cleaning out the garbage cans or working the phones or running the company.  Everybody has value, and football taught me to make people feel that value to get the best out of them.” (emphasis added)

Great insight toward building an effective TEAM. If you want to build a highly effective team for your business, a team that will enable you, your business and the team itself to bring amazing value to your customers and community, my ActionCOACH colleagues and I are ready to help.  All you must do is pick up the phone, tablet or keyboard and contact an ActionCOACH business coach.

Why Should I Be Your Customer?

I often ask my clients to answer, “Why should I be your customer (client or patient) (CCP)?” from the point of view and value proposition of their ideal CCP’s, not their point of view.  That question is also featured in many of my seminars and workshops.  In fact, I posted a blog in October 2015 entitled “What is Your Product or Service?” which expanded on that very important question.  I just finished an article in the December 2018 edition of Builder magazine entitled “Closing The New vs. Existing Divide” by Vincent Salandro which offers another very practical take on this subject. While focusing in on the factors that lead home buyers to buy newly constructed homes rather than existing homes, the article presents a statistical approach to understand home buyer preferences and how a builder might increase their market penetration.  The article quotes data from the Zillow Group New Construction Consumer Housing Trends Report 2018 to make a strong case for developing a very deep understanding of the value proposition of the ideal customers of new home builders. The Zillow Group report found that while 38% of potential home buyers considered buying a newly constructed home in 2017, only 11% purchased one.  In delving deeper into the data, the author expands on many of the factors that would be useful in refining a builder’s definition of their ideal customer.  Some of the factors included where:

  • Age – new home buyers tend to be older
  • Ethnicity – 74% of new home buyers self-identified as Caucasian/White
  • First-Time buyers vs. Moving Up or Downsizing buyers
  • Geography

The article goes on to look at the top fourteen reasons buyers purchase new homes.  Such factors as:

  • Everything is new/never used – 48%
  • Ability to customize features of the home – 23%
  • Ability to have smart home features – 6%

These were a great look at new home builder’s customer value proposition. Finally, the article looked at how new construction home buyers shop for their home.  Most who purchase newly constructed homes relied on technology, 68% using a laptop or desktop and 46% using mobile devices to shop for their home.  Only one-third of new home buyers used mobile, much less than buyers who purchased existing homes. What does this have to do with your business?  To answer that, I have a homework assignment for you.  I suggest you ask yourself the following questions:

  • How well do you understand your ideal Customer, Client or Patient? – When is the last time you gathered any market statistics that might be used to refine who your ideal CCP is?
  • How well do you understand ALL the various factors that make up your ideal CCP values? – Have you asked your CCPs why they buy from your company?
  • How well do you understand how your ideal CCPs found you? – Are you “hanging out” in all the places you should?

My colleagues and I are well equipped to assist you to better define, understand and find your ideal customers, clients or patients.  The better you are at serving them, the more successful you will be.

The Nine Keys to Effective Delegation

I can’t believe that it has been four years since my last blog post about effective delegation.  I find this fact surprising because effective delegation within a business is one of the most important foundations of long-term success.  Without delegation at all levels of a team, the company and team members will not maximize each of their potential to create value for themselves, their customers (clients or patients), their company, their market and their community. Following are the nine keys to effective and successful delegation:
  1. Present the desired result and confirm it is fully understood. If you ever listened to your pilot communicating with air traffic control while flying, you would have noticed that the pilot doesn’t just acknowledge the controller’s instruction.  The pilot always repeats the instruction back to the controller.  That insures the instruction was fully understood.  When you delegate, it is imperative that the person you are delegating to, repeats the desired result back to you.  Ask questions to make sure that there is complete understanding of the desired result.
  2. Present guidelines or limits as to how the result is to be achieved. Define the “playing field,” their authority to contact, direct or contract with other departments or outside resources they may need.  The company’s CPA or attorney for example.  Is the project or task confidential?  If so, what level of confidentiality is to be followed.
  3. Discuss the resources that are available. Budget, team, equipment or space must be clearly defined.
  4. Establish a timeline. Discuss time constraints or deadlines, both internal and external.  In situations where there is flexibility, buy-in can be achieved by asking “When can you have this completed?”
  5. Make yourself available if assistance is needed and requested. Make it clear to the delegatee that you are available if they ask for assistance.  And make it clear that such a request will not be held against them.  One common example of required assistance is to overcome the resistance of people in other departments within a company to respond to the delegatee because they do not have a high enough title.
  6. Set accountability and KPI’s to measure progress toward the goal. You cannot manage something if it is not measured.  Setting measurements supports Key 8 and eliminate disappointment and surprises.
  7. Discuss the consequences both good and bad related to the desired result. This is the opportunity to present why the desired result is important.
  8. Periodically follow up. Without follow up questions, such as “How’s it going?” or “Are you on schedule?” or similar, there is only abdication, not delegation.  I have observed many instances of failure due to lack of follow up.
  9. Do not Jump-In to rescue. You may need to assist when a project goes off the rails.  However, if you jump-in and take the project over, you are doomed to having this repeat on future projects.

Remember “Successful delegation has more to with the delegator … not the one being delegated to.” – Darren Hardy

The ActionCOACH DelegationRICH workshop expands and details this subject.  If you want to get leverage of your and your team’s time, knowledge and talents, my colleagues and I will be happy to assist you to become a world class delegator.