- Author Chris Hadjiyianni
- Year Date 2018
- Location Winnipeg
- Category Business
All business owners will exit their businesses,either by choice or as circumstances dictate (e.g., death, incapacity). Ideally, owners want to exit on their terms: leaving their businesses in the hands of successors they choose, on a date they pick, and for the money they need and want.
The three universal goals every owner must set are deciding when, to whom, and for how much owners leave their businesses. Understanding and quantifying these three goals—as well as their other aspirational goals—are the first indispensable steps of the Exit Planning Process. Your goals are indispensable because they establish your Exit Plan: the road map that sets the route from where you are today to where you’d like to be at the end of your ownership journey.
This white paper is about defining your destination. Specifically, we’ll discuss how to create actionable goals that include defining when, for how much, and to whom you eventually want to leave your business, as well as the aspirational and values-based goals that many owners have. Finally, we’ll show you how best to achieve the goals you set.
Setting goals for the future of your ownership isn’t difficult per se. You likely have general, or perhaps specific, ideas about when you would like to exit, how much money you need or want, and who your preferred successor is. You may have additional aspirations, or values-based goals, such as maintaining your company’s culture, creating a legacy, or rewarding employees. Whatever your goals are, they must be SMART:
For each action aimed at achieving a goal, there must be a deadline and responsible person. To make that deadline useful and hold the person(s) responsible for it accountable, you must make those goals specific and write those goals down.
The act of putting specific goals in writing forces you to think about what you want to do and why. Additionally, if you work with your advisors (specifically, an Exit Planning Advisor) to define your goals, you will be prompted to consider more types of goals, collect more information when setting them, and think more deeply about them.
It’s crucial that you work with your advisors on setting your exit goals. Achieving your goals will undoubtedly require their involvement. While you focus on running your business and what you’ll do after you leave it, your advisors will present options and strategies to reach your goals. They will do that most efficiently if you put your goals in writing, thus giving everyone a single point of reference: your successful exit as you define it. Without that focus,you open the Process(and your wallet)to costly inefficiencies.