It’s my catchphrase, and it’s a great idea: Build companies that stand the test of time.
But what does it mean?
How do we build companies that are more? It starts with a solid understanding of where we are and where we want to be in the future. If we don’t have a clear vision for the future, we’re going to have a difficult time making a company last. The first step is to understand what needs to be done with the business. Then we can start working on tactical steps to make a worthwhile, strong company that can stand the test of time. Here are some keys to consider when your goal is to build a company that stands the test of time.
#1. What do the owner or the control parties of the company want for the business long-term? Is this a family project with a goal to transition it to the children or other loved ones? Is the company set up to provide for the welfare of the spouse if the owner dies? Do they want to build a company that services others and takes care of its employees for the long-term? Each of these goals has special demands and desires, and each of these can be serviced in different ways.
#2. What is the owner’s exit plan? We need to know how the owner plans to leave. Is it an orderly sale? Will it be a transition? Either way is acceptable, but the required planning is different.
#3. How do we make the business bigger than the owner? How do we make the business stand separately from its owner or control parties so that it will live on and on and on? It takes a lot of work. We need to take the company to where it transcends time and loves itself regardless of what’s happening to the owner or the other internal parties. The business needs to be bigger and have its identity.
There is a lot of economic value to be captured in building companies that stand the test of time. But that requires hard work and investment — before the problems happen — so that the company is there and ready to expand.
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This posting is intended to be a tool to familiarize readers with some of the issues discussed herein. This is not meant to be a comprehensive discussion and additional details should be discussed with your attorneys, accountants, consultants, bankers and other business planners who can provide advice for your circumstances. Each case is unique. Past results do not guarantee future outcomes. This article should not be treated as legal advice to any person or entity. Freeimages.com/photographer Debbie Schiel.
About the Author
R. Shawn McBride is the Chief Innovation Officer at McBride For Business, LLC. His signature keynote, The 3 Laws of Empowerment, gives audiences an entertaining look at how they can prepare, plan and protect themselves. You can email R. Shawn McBride or (214) 418-0258.
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