WHERE is your business going & what will it look like? PART 2 of 2
By Paul Latham
Would you ever drive your car aimlessly? Probably not – so why do so many business owners “drive their business ” without knowing where they are NOW – or WHERE they are planning on going? It’s no wonder that most business owners fail to maximize business potential.
In Part 1 – we began by talking about where your business is located NOW – today in Part 2 we will concentrate on the WHERE we are heading.
When you start planning a road trip, your biggest decision is ALWAYS to decide WHERE you are going. Then, the fun begins. You research the best places to stay, the most popular attractions, and of course, the most delicious food to eat. But, you must also factor in where you are NOW, the stops along the way, and most importantly coordinate the best route to get there.
You should use exactly the same thought process with your business as with any journey.
Unless you are a “lifestyle business” or “planning on going bust” one day – as a business owner you only have a choice between 3 Business Destinations – and one of those is highly unlikely!
Business Destination 3: Just conceivably you might be planning to take your business “Public” one day. In that case you should definitely be seeking expert assistance because it is a very specialized journey. But for now let’s assume that is not your plan – which leaves you with a choice of 2 possible destinations – but they are as “different as chalk and cheese”! Let’s take a look at each.
Business Destination 1: This is the Sale route – and it is the preferred destination for most business owners. That’s because a sale is the easiest destination to plan and it is a very structured journey (as depicted by the straight line on the map illustration).
In fact if you are planning on selling your business – there is really only one thing you need to remember, which is – “you need to build a business that looks like one that somebody else will want to buy”! So the key question becomes – what are potential buyers looking for?
We look at this question in much more detail in our “Knowledge Injection” Video called Planning for a Business Sale (available on request)– but the key takeaway is to put yourself in the shoes of a buyer and ask yourself the question – “what would excite and interest a potential buyer the most”?
It’s then simply a case of constructing a business strategy to create that vision – and make it happen (combining a plan and desire). If you are interested about how we combine these “3 Ingredients of Business Success” (Vision – Plan – Desire) then “come in for a chat” with your business advisor or ask to watch the Knowledge Injection video.
Business Destination 2: This is the Succession route – and is much the more difficult to maximize business potential (certainly without facilitated expert help). Why is it difficult? Well no two successions are ever exactly the same – so it’s not a structured route – it’s a far more “windy and idiosyncratic journey”.
We look at succession planning in much more detail in our “Knowledge Injection” Videos called Planning for a Business Succession and Planning for a Professional Partnership Succession (both available on request)– but the key takeaway is that a successful succession is all about creating a “win:win scenario” for both parties (usually the older, retiring party as well as the younger, succeeding party).
By the way – if you are still UNSURE between Sale and Succession – “rule of thumb” – assume business sale (the more structured route). It is FAR easier to plan for sale and then pivot towards a succession plan (if required) than to attempt the reverse!
The other big question when it comes to destination planning is TIMING.
It is never too early to begin to shape what you want your business to LOOK LIKE – and WHERE it is heading – but if you are LESS THAN 5 YEARS away from your destination then DESTINATION PLANNING should be 100% of your strategic focus.
Conversely – if you are MORE THAN 5 YEARS away from your destination then GROWTH PLANNING will most likely be your key strategic focus. Remember there are “Only 4 Ways to Grow a Business” (if you are interested about business growth then come in for a chat with your business advisor).