I used the following visual a few times during talks last week and it went over well. My point is that business owners must know what their company’s value is, how to drive that value higher and have an exit strategy to increase the chances of getting that value out when it’s time to leave (sell).
Value
+
–
+
Exit Strategy
+
~
–
~
–
The owner whose business is in the upper left quadrant (+) is well positioned. They have an exit strategy, know their company’s current value, know where they want that value to be and have reached their destination.
Those in the upper right or lower left quadrants (~) are okay or neutral. They either have the value where they want it but have no plan or have a plan but haven’t achieved the value they want. In either case, they are on the right track.
It’s the owners in the lower right quadrant who need to work. Their value isn’t what it should be and they have no plan. They must work on driving their company to the upper left quadrant. If they don’t, they risk falling behind the pack and when the expected tsunami of business sales hits they could be forced to sell for much less than they hoped for.
“Progress is not created by contented people.” Frank Tyger
