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As a business owner, you know what it’s like to lie awake at 2 a.m. Maybe it has happened when you are excited and full of new ideas for your business. More often, it’s because you are worried about issues you will face the next day. Sometimes, it’s because you just woke up with the solution to a problem. I’ve experienced all those emotions about my businesses over the years. Awake at 2 o’clock? is where I share them with you, and hopefully help with answers that will let you sleep.
John F. Dini, CExP, CEPA
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Small business owners are the Hunters of the 21st century. We are 3% of the US population, and yet we create over half of all American jobs. As Hunters, we may not be inclined to manage by the numbers or stick to systems. Are you a Hunter or a Farmer?
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How prepared are you to exit your company?
The Assessment breaks down the four major categories of exit readiness; Finance, Planning, Operations and Revenue/Profit.
Tag Archives: exit planning
Protecting Your Best Asset
If you are planning your exit from the business, what is the best asset that you have to sell? Unless you have patented product, exclusive rights, or long-term customer contracts, you answer was likely “Our people.” Even if you have … Continue reading
3 Responses to Protecting Your Best Asset
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Exit Timing and the Global Economy
How much will your exit timing be affected by the global economy? Most small businesses serve local markets. Their owners, if they have thought about it, plan to sell to a local individual. If the local market is healthy, why … Continue reading
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One Response to Business Buyers: The “Buy Now, Pay Later” Generation
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This is one of the most realistic articles I’ve read on the topic. Sellers would be wise to listen to their advisors, and be advised earlier than they think they should.
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Ownership Transfer and Employee Security
When we start planning for the sale of a company, many owners ask me about sharing information with employees. They are naturally concerned that an ownership transfer will cause their workers to seek more secure positions elsewhere. This is true whether … Continue reading
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Generational Differences and Identity Politics
Generational differences are a hot topic for organizational behaviorists. Is this a real issue, or is it just the current management fad? “Never in history have we seen four generations together in the workplace.” That line starts thousands of articles … Continue reading
3 Responses to Generational Differences and Identity Politics
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The boomers and the millennials should appreciate the strength, knowledge and understanding of each generation, by so doing an effective structure can emerge which could yield high valuable growth and benefits for both generation.
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I believe it all comes down to empathetic listening on each generational level. This takes active listening to another level where you connect with another’s core emotional being, in addition to understanding the message. Seek first to understand and apply the platinum rule (treat others the way they want to be treated). Working with multiple generations also requires informed leadership styles: not the leadership based on the “seat of your pants”, but leadership that is adapted based on the study and application of leadership principles. Yes, different generations are products of their political, economic, and cultural environments; but this isn’t a bad thing. It has been established through many studies that the more diverse a team is, the stronger it is!
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I’m adding my two cents to elaborate on this in your article: “The “Generational Differences” seminars that business owners need aren’t just about how to deal with employees who think differently and hold different values. We need some idea of how to deal with workers who . . . are being told that the blame rests squarely on the boss.”
Okay, first a warning: Millennials probably should not read my comment or listen to my podcast: Some millennials are among the kinds of employees increasingly destroying small businesses. (And undermining larger employers.) Not all of them, but a certain kind. At the risk of offending some people, but with the intent of helping employers, my brief podcast may be enlightening (it’s on my website): http://partneroncall.com/kinds-of-employees-increasingly-destroying-small-businesses/
John, You are spot on about the importance of being able to get your staff to support the transition. The process starts by finding out as much as you can about the buyer’s intentions for your employees. With that information you can plan for incentives that give employees who you believe are likely to be retained, a reason to make the transition work,and offer reasonable compensation to those who are likely to be terminated. The retained employees have a better attitude if they believe that the seller cared about those who did not fit the new owner’s plans. In one acquisition situation we debated how much money was appropriate and how it should be distributed. Our decision was that the employees had exceeded normal commitments to the company, particularly in the early stages and they deserved financial reward. We voted and arrived at 5% of the capital gain on the sale. These funds were allocated on a pro-rata basis of the employee’s accumulated base salary without allowance for bonuses. On this basis a secretary who had worked for 5 years at $30,000 per year and earned a total of $150,000 received the same amount as a VP of Sales who had worked 1 year and earned $150,000. Those employees who were retained in the transition were subject to vesting requirements. Those who were released were paid a month after termination. We considered a longer delay after termination to discourage defection to get a quick cash bonus, but the conditions offered by the buyer made it unlikely that retained employees would quit. This arrangement resulted in a smooth transition.
Great example, David. Thanks!
The easiest thing to do is to share the profits of the company with your employees and to give them ownership before the sale. I was not planning to sell my company, but when the right offer came in I sold and my employees shared over a half a million dollars among 35 employees. 25 years later most still remain with the company..