subject: Exit Planning - No Owner Left Behind Initiative [print this page] Exit Planning - No Owner Left Behind Initiative
With the global recession showing signs of bottoming, I believe that it is time to take strong action in rescuing the private business owners from the 'mousetrap'in which they have caged their illiquid wealth. So in a moment of inspiration, I created the No Owner Left Behind initiative. This is a theme around which Pinnacle will focus its upcoming Certification and training efforts- let me explain a bit more.
In 2001 President George W. Bush passed the No Child Left Behind Act. TheNCLBenacted the theory ofstandards-based education reform, which is based on the belief that setting high standards and establishing measurable goals can improve individual outcomes in education.
If you have been a part of the exit planning community for any length of time, you have invariably been challenged with consistently marketing, selling and delivering this service to owners. I know this because so many advisors come to Pinnacle for our coaching and support, having previouslystruggled withimplementing exit planning into their business.
So I've decided to code-namePinnacle's Certification initiativethe No Owner Left Behind program. Behind this notion and program is the idea ofsetting high standards for the education and business of exit planning along with establishing measurable goals and benchmarks that exit planners - and advisors who wantto include this in their offerings - can rely upon to grow their practices. This will help to assure improvements to the deliverables and advice that owners receive regarding this critical planning area.
The exit planning profession is in strong need of such efforts. Asmany already know,the exit from a business is a very challenging task. Pinnacle has 16 critical points that our Certificate holders will need to master - these are 'must haves' for any advisor who wants to achieve this designation.
Let's take a look at a few of these initial points - areas where most owner exits go wrong -as a starting point for this reformation effort and where standards andbenchmarks can be implemented:
The Need in the Marketplace Matched by Unrealistic Expectations/Lack of Awarenessby Owners
Owners do not have the information that they need to set realistic expectations for their exit. This is first issue that needs to be addressed by advisors to exiting owners.Within this first category, some of the sub-issues that need standardization andbenchmarks are:
The time and complexity involved with anexit
The realistic range of values of the owner'sbusiness
What is required formanagers to step into leadership roles
What is required of the owner to empower these managers
The owner'spersonal savings habits and their ability to maintain their lifestyle without the business.
The owner's ability to maintain ameaningful and productive life beyond thebusiness exit.
Standardsand tools need to befurther developedfor advisors to communicate these issues to owners, impressing the importance of each one to the owner's future exit. Without sharing these critical points with our exiting owners, many owners will continue to be left behind - stuck in their businesses, suffering with their unrealistic expectations.
The Expansive Nature of Exit Planning
The next area of standardization has to do with what goes into an exit plan. The fact of the matter is that, done properly,exit planning is a complex and comprehensive process. There are so many areas of an owner's life that are impacted by the exit that it is necessary to have a 'planner's eye', to be able tounderstand all of these areas and provide a completesolution to the owner.
The problem is that every area of examination - be it savings, investing, retirement planning, estate planning, tax planning, business planning, transactional work,etc . . . all are disciplines unto themselves. So, how can any one advisor provide an exiting owner with this type of overview of their needs foran exit?
Again, the answercomes down to standards andbenchmarking for an overview / understanding of all of these areas.The key is knowing whichitems areessentialto any exit andhow you can identify these issues. From there, it is important toassess which advisor(s) on the owner's team can complete the necessary work.How you, theexit consultant,make these assessments, communicate with thoseother advisors, and deliversolutions to your owners will, for the most part, determine the success of your owner's exit.
Do you have proceduresand tools in placeto address these issues?
Are youprepared with the right questions anddeliverables to make your exiting owners comfortable with your process?
Getting Beyond the Struggle
These are just two (2) of the sixteen points that Pinnacle's new No Owner Left Behind and Certification Program willaddress.A well versed exitconsultant willask the right questions to get to the most important issues that address both the owner's personal and business goals. Icontinue to beamazed by the high quality of advisors who are drawn to exit planning, which is reflected in the great number of conversations that I have with advisors andconsultants who are doing this work today.
Almost every conversation includes some level ofdoubt in the advisor or consultant's mind as to whether they are completing a full examination of their owner'ssituation. In almost every case, it is my opinion that theadvisor or consultant has so much more than they need to be effective in the conversation with their owners. What is missingare standards andbenchmarks by which this competency can be measured. So Iencourage you to set these standards and goals in your ownpractice and think ahead to what your owner's needs will be.
So together we are on a mission to Leave No Owner Behind.Let's not allow the aging Baby Boomer generation of owners to sail into the sunset without direction or navigation. Let's continue to build value into our conversations with owners, earning the right toguide them through this difficult exit process. When the work is complete, we will bring order to this emerging field of exit planning and move our owners towards the exits that they deserve.
