Failsafe Exit 7.1.09

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


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


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


Case Study: H2 Architects

H2 Goals

Within 12 months leadership team:

• Handle operations

• Profit of 20%+

• Employee satisfaction

• Develop understudies

• Become stockholders


H2 Architects: Owner’s Time in 2004


Owner’s Roles in 2007

Highest value activities:

• design

• business development

• 3 week vacation


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


Case Study: Authority Sharing


Case Study

Tie Role Responsibility to Performance Benchmarks and Incentive Pay


Take These Steps, Use These Tools

1 - VISION:

Define & Map Owner & Company Future



2 - ASSESS:

Identify and Assess Top Talent


Prepare the Foundation

Look at your business

through the lenses of your buyers


Take These Steps, Learn These Skills

3- LEADERSHIP MINDSET:

Build the Leadership Team


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


Crucial Conversations

Decision-Making and Crucial Conversations® Skills

Debating assumptions and making trade-offs openly in a group builds leadership team effectiveness.


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


Your brain’s

functioning…

when you are not

stressed or upset.

You Are Normally Rational


Learn to Avoid…

Your brain’s

functioning…

during a crucial

conversation.


Your brain’s

functioning…

when you use

Crucial Conversations ®

skills.

Get the Results You Want


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


Essential Team Conversations

• Improvement in company performance

• Delegation and sharing of authority

• Career path and role-changes

• Individuals’ performance



4 STRATEGY:

Performance Planning


4 Decisions

4 Decisions All Growth Companies Need to Get Right


Review: 4-3-2-1 Results


Cash

Cash Conversion Cycle


One Page Business Plan


Performance Compensation

Role Clarity & Key Performance Indicators (KPIs)


Multi Rater Feedback


Achieve These Results

5 REWARD:

Performance Compensation


Strategic Leadership Assignments

Leadership Enhancers

• Tough assignments

• Failure and rebound

Leadership Derailers

• Not open to feedback

• Lack of introspection

• Need to be right


“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


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


Expect Results


Expect Results

Results

• Leadership Mindset™= skilled management, role clarity,

performance, accountability, execute strategy

• Shared vision: from “me” to “we”

• 2X valuation


Foundation for Success


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

Failsafe Exit 7.1.09

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