Failsafe Exit 7.1.09
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www.sandyblahaperformanceconsulting.com
The 5 Keys
to a
Failsafe Exit Strategy
How to Dramatically Improve
Business Valuation
through Effective Exit Planning
© 2009 Sandy Blaha Performance Consulting 2
Performance Drivers
The primary driver of performance
and value in a business
is talent and the effectiveness
of your management team.
McKinsey, 1997
© 2009 Sandy Blaha Performance Consulting 3
5 Keys Value Building System
1. VISION: Define, map owner’s future
2. ASSESS: Identify and assess top talent
3. LEADERSHIP MINDSET: Build the leadership team
4. STRATEGY: Performance planning
5. REWARD: Performance compensation
© 2009 Sandy Blaha Performance Consulting 4
Results of a Successful
Value Building Process
A Winning Team Delivers on Average
• 30 to 50% sales growth
• 90% retention of top talent
• Attraction of A Level Talent
• Freedom: 30% reduction in owners’
involvement in operations
• Increased shareholder value
• Business continuity
• Trust and engagement
© 2009 Sandy Blaha Performance Consulting 5
Case Study: H2 Architects
H2 Goals
Within 12 months leadership team:
• Handle operations
• Profit of 20%+
• Employee satisfaction
• Develop understudies
• Become stockholders
© 2009 Sandy Blaha Performance Consulting 6
H2 Architects: Owner’s Time in 2004
© 2009 Sandy Blaha Performance Consulting 7
Owner’s Roles in 2007
Highest value activities:
• design
• business development
• 3 week vacation
© 2009 Sandy Blaha Performance Consulting 8
Results of H 2’s Transition
2004 Year End 2007 Year End
Project Size 150,000 SF 200,000 SF
Revenue $2.4 million $3.6 million
Profit $250,000 $1 million
Stockholders 1 6
Repeat Clients 72% 82%
Industry Awards 1 4
Rev per employee $109,000 $120,000
© 2009 Sandy Blaha Performance Consulting 9
Case Study: Authority Sharing
© 2009 Sandy Blaha Performance Consulting 10
Case Study
Tie Role Responsibility to Performance Benchmarks and Incentive Pay
© 2009 Sandy Blaha Performance Consulting 11
Take These Steps, Use These Tools
1 - VISION:
Define & Map Owner & Company Future
© 2009 Sandy Blaha Performance Consulting 12
Take These Steps, Use These Tools
2 - ASSESS:
Identify and Assess Top Talent
© 2009 Sandy Blaha Performance Consulting 13
Prepare the Foundation
Look at your business
through the lenses of your buyers
© 2009 Sandy Blaha Performance Consulting 14
Take These Steps, Learn These Skills
3- LEADERSHIP MINDSET:
Build the Leadership Team
© 2009 Sandy Blaha Performance Consulting 15
The Behaviors of Trust
• Talk straight
• Create transparency
• Deliver results
• Get better
• Confront reality
• Clarify expectations
• Practice accountability
• Keep commitments
The Speed of Trust
Stephen M.R. Covey
© 2009 Sandy Blaha Performance Consulting 16
Crucial Conversations
Decision-Making and Crucial Conversations® Skills
Debating assumptions and making trade-offs openly in a group builds leadership team effectiveness.
© 2009 Sandy Blaha Performance Consulting 17
Conflict and Productivity
Conflict Management
• 19 to 26% of management time is spent resolving
conflict
• Conflict management skills result in improved:
‒ Decision quality
‒ Job satisfaction
‒ Employee retention
© 2009 Sandy Blaha Performance Consulting 18
Your brain’s
functioning…
when you are not
stressed or upset.
You Are Normally Rational
© 2009 Sandy Blaha Performance Consulting 19
Learn to Avoid…
Your brain’s
functioning…
during a crucial
conversation.
© 2009 Sandy Blaha Performance Consulting 20
Your brain’s
functioning…
when you use
Crucial Conversations ®
skills.
Get the Results You Want
© 2009 Sandy Blaha Performance Consulting 21
Conflict and Success
The measure of success is not
whether you have a tough
problem to deal with, but whether
it is the same problem you had
last year.
John Foster Dulles
© 2009 Sandy Blaha Performance Consulting 22
Essential Team Conversations
• Improvement in company performance
• Delegation and sharing of authority
• Career path and role-changes
• Individuals’ performance
© 2009 Sandy Blaha Performance Consulting 23
Take These Steps, Use These Tools
4 STRATEGY:
Performance Planning
© 2009 Sandy Blaha Performance Consulting 24
4 Decisions
4 Decisions All Growth Companies Need to Get Right
© 2009 Sandy Blaha Performance Consulting 25
Review: 4-3-2-1 Results
© 2009 Sandy Blaha Performance Consulting 26
Cash
Cash Conversion Cycle
© 2009 Sandy Blaha Performance Consulting 27
One Page Business Plan
© 2009 Sandy Blaha Performance Consulting 28
Performance Compensation
Role Clarity & Key Performance Indicators (KPIs)
© 2009 Sandy Blaha Performance Consulting 29
Multi Rater Feedback
© 2009 Sandy Blaha Performance Consulting 30
Achieve These Results
5 REWARD:
Performance Compensation
© 2009 Sandy Blaha Performance Consulting 31
Strategic Leadership Assignments
Leadership Enhancers
• Tough assignments
• Failure and rebound
Leadership Derailers
• Not open to feedback
• Lack of introspection
• Need to be right
© 2009 Sandy Blaha Performance Consulting 32
“Motivation is highest when the probability of success is 50%.”Judith Bardwick
Creating an Organization of Winners
ENTITLEMENT FEAREARNING
I HAVE IT
COMING
I DID THE BEST
I COULD
I LIKE THINGS
JUST THE WAY
THEY ARE
HAVE YOU
THOUGHT IT
THROUGH?
LET’S GO FOR
EXCELLENCE!
SHOOT
FOR THE
BIG ONE!
YOU CAN
NEVER LET UP
WATCH OUT!
MAKE ME
SAFELow High
High
Anxiety
Pro
du
ctivity
© 2009 Sandy Blaha Performance Consulting 33
5 Keys Value Building System
1. VISION: Define, map owner’s future
2. ASSESS: Identify and assess top talent
3. LEADERSHIP MINDSET: Build the leadership team
4. STRATEGY: Performance planning
5. REWARD: Performance compensation
© 2009 Sandy Blaha Performance Consulting 34
Expect Results
© 2009 Sandy Blaha Performance Consulting 35
Expect Results
Results
• Leadership Mindset™= skilled management, role clarity,
performance, accountability, execute strategy
• Shared vision: from “me” to “we”
• 2X valuation
© 2009 Sandy Blaha Performance Consulting 36
Foundation for Success
© 2009 Sandy Blaha Performance Consulting 37
Sandy Blaha Performance Consulting
Sandy Blaha Performance Consulting provides comprehensive
organizational effectiveness that grows value for exiting and next-
generation owners:
• Talent Assessment
• Exit planning
• Leader development
• Performance management
• Strategic planning, consulting, training and coaching
www.sandyblaha.com
303-260-6480
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