Once you have a few peak performers, you’re going to want to hang on to them. To do that, you’re going to have to pay them well. But it’s going to take more than money. It’s going to take making them a psychological partner in your business.

When we talk to the people our clients identify as peak performers within their own organizations, we typically find that they are meta-motivated by such factors as:

• Participative leadership;
• Shared responsibility;
• A sense of ownership;
• Alignment of purpose;
• High levels of open communication;
• Opportunity for future growth (including potential for a minority interest in the business);
• Results;
• Creative talents; and,
• Rapid response.

As ...Read More

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In earlier columns, we’ve talked about the difference between hiring and recruiting:

You cannot hire a peak performer. You must recruit them.

Many people believe themselves to be experts in this area. Most are not.

The recruiting process involves separating the relationship aspects of leadership from the task - not permanently, just long enough to identify the separate requirements. Some inspirational people focus on relationships; just as some accomplished virtuosos focus on tasks. What we need in a peak performer is a little bit of both.

The first step in this process is to identify the characteristics that you think make up the ideal person for the position. Below is a table you can use as a guideline to help focus your thinking.

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One of the most frequently asked questions I receive is “How long do you think it will take?” Usually, the question is in reference to implementing some recommendations we’ve made about how to positively impact performance.

Unless the company is in a survival crisis, our experience indicates that building a high performance culture usually takes about 12 – 15 months for each layer of management. For many entrepreneurs and early generation businesses, that seems like a couple of lifetimes, which leads to the next question:

“What can we do to speed that up?”

The answer: “Not much.”

As an example, if the directions on a cake recipe call for oven time of 20 minutes at 350 degrees, cranking the oven up to 700 won’t give us an edible cake in 10 minutes. What it gives us i...Read More

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With an understanding of the 10 Steps to the Development and Implementation of an Exit Strategy, we can address the interdependency of time to the development and implementation of an exit plan.

The Most Responsible Time Line

An assumption that anyone has the security of a long-term hold on leadership and control creates instant vulnerability. Therefore, the most responsible time line for establishing an exit strategy is to assume that there is no time available. Now is the time to confirm a contingency exit strategy that identifies who should be or could be a successor. Irrespective of age or time on the job, every business leader has a stewardship responsibility to address the contingencies of his or her death or disability....Read More

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The “Exit Strategy Dilemma” acknowledges the challenge of patronizing the needs and goals of both current business owner and the business. Time line appears to be the hinge pin of this dilemma because the owner wants to keep their options open and businesses need to address strategic needs, issues and vendors.

The circumstances of the business can impact the amount of time needed to pull off the succession strategy. Reciprocally, the time available commonly dictates the practical steps of an exit strategy. Just “getting the hell out of Dodge” and tossing the keys to a family member or the senior manager is not a significant challenge. However, transferring leadership and management control in a manner that has optimum impact on both the owner and the business re...Read More

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Exit strategy directly impacts a large group and indirectly impacts everyone associated with the business. When the subject of exit strategy is broached, antennas around the organization and within the family go up. The retirement plan of a business owner is a very important subject to family successors, key managers, vendors, creditors and Board members.

Carrying on dialogue on this succession issue and achieving traction are two strikingly different goals. Anyone who has ever been associated with an innovative, ambitious, driving business owner recognizes pulling off an exit strategy or even making substantive progress is a formidable challenge. These dynamos are often caught in the Exit Strategy Dilemma.

On one hand, the owner can be relying upon the business for fun, fellowship and stimulation because he/she doesn’t have other ...Read More

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In my first two posts on exiting gracefully, Exiting Gracefully - Face the Fear and Exiting Gracefully - Do I Still Got It?, I indicated that you must face your fear and perform self analysis on the value that you’re still bringing to the table. Both of these issues have to do with you.

There are generally two components to a graceful exit – the first is through “getting out of your own way; and the second would be empowering yourself to step up and fill the void that will be left by your departure.

Successor development is a complex relational issue. The fundamental truth is that your successor in all likelihood has different…

• Attitudes regar

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Exiting gracefully is no easy task. I’m constantly advising the “next generation” about the role their aging father or mother, who may also be declining health, is playing in holding up the business.

Don’t get me wrong. I’m all for re-firing rather than re-tiring and believe that retirement is not something to strive for. But passing the baton of a business is different. The business is greater than you, and you have a stewardship responsibility to ensure that it continues on beyond you in a smooth and seamless fashion, requiring a graceful exit. 

In my last post, Exiting Gracefully - Face the Fear, I indicated that the first step to exiting the business gracefully is to recognize and face your fear. I understand that this requires some critic...Read More

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I just finished my tax return for 2007, wrote checks for the balance due, and then wrote checks for the 1^st quarter estimate for 2008. Now that was painful! 

From my experience in working with business owners, exiting the business is similar to paying taxes - PAINFUL, and in many cases more painful than stroking those checks. I’m reminded of an experience I had in a family-owned bank just a few weeks ago, where I poked my head in the door of the 86-year old patriarch’s office to find him taking a nap. And, buddy, this was no power nap. He was mouth-open, sawing-logs, napping! Now, what exactly is he doing to help the business be more productive? 

So, I’ve asked myself, why is it so difficult for some business owners to pass on the baton and exit gracefully? Well, there are a plethora of reasons th...Read More

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Why is this important issue given such little attention? This question has boggled my mind for quite some time. Somehow our children make their way through high school and even college, yet the vast majority graduate with very little exposure to some of the basic financial necessities such as balancing a check book and understanding credit cards. In fairness to our educational system, this is not completely their responsibility. Parents are also responsible.

You may be wondering “what does this have to do with succession planning"?

The bottom line is if you are not teaching family members the importance of monetary literacy, there is a good chance this could impact the ongoing success of your business. Without financial understanding and accountability, your children will not be good stewards of what you have worked a lifetime to build such as th...Read More

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In the midst of an interview with a Key Manager, I asked the following question: In the event Bob (dad/controlling owner) does not make it home tomorrow, what happens to the business? The Key Manager responded, “Well, I guess Johnny (son) would take over at which time I will find another job. Please, please keep this confidential Dave. There is no way in hell I will ever work for Johnny! After Bob is gone, so am I! The only reason I am still here is out of loyalty to Bob.”

Having the opportunity to meet with Johnny the prior day, I could appreciate why the Key Manager felt the way he did. Johnny came across as an arrogant, “know it all” despite the fact that he had limited work experience. Personal humility was a foreign concept to Johnny and if you looked up the word entitlement in Webster’s Dictionary, you would see a picture of Johnny....Read More

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“I know I need to address my succession plan but I am not sure this is a good time. After all, profitability is down year over year and I have had to lay off several people recently.”

Many businesses are experiencing a downturn in light of the economy and the uncertainty looming ahead. It is natural for you to assume that initiating your succession planning is an expense that can wait for a brighter day. However, I would encourage you to reconsider your position.

Difficult economies and business downturns can be a tremendous opportunity for you to improve your business. Rather than simply attempting to save your way into a profit by cutting expenses, utilize your succession plan, in particular a strategic plan, as a catalyst and tool to help you manage the business through a recessionary period as well as position your business to take advant...Read More

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