Your firm might not be for sale. Even if it were, you might not have the money to buy it. Please suspend reality for a moment and think about the following question:
Would you buy your firm?
If yes, what would you be buying? People? A brand? A client list? A portfolio of buildings? A culture? Patents? Methods and tools?
If no, why not? Dependence on the connections and expertise of a few key individuals? Lack of a distinct competitive advantage? The brand? The culture? More attractive investment options?
I recently read Built To Sell, by John Warrilow. I want you to read it, because it asks uncomfortable questions that yield fruitful discussion. Perhaps the most uncomfortable of them all is about the sale of your business. The idea of selling the firm is emotional for owners (“my baby!”) and employees (“my job!”) alike, so I find that we don’t talk about it. But I think we should, for a couple reasons:
1) Your firm is for sale. There are only three endgames for any company – sell the firm to internal buyers, sell to an external buyer, or wind the company down and sell the assets.
2) Built to sell is built to thrive. One of the central premises of Built To Sell is that the same practices that make your business more valuable to buyers, make your business more profitable and enjoyable to operate, namely, reducing your dependence on a few key owners, putting knowledge about clients and services into repeatable methods, and focusing on doing one thing better than anyone else.
3) Asking the question, “Would you buy your firm?”, will lead to new insights for improving your business. Attempting to put a value on your firm, or even better, thinking about how to make the firm more valuable, will be a new frame of reference for most of the people in your organization. Looking at your business from the dispassionate point of view of an outsider will yield more clarity on the knowledge that needs to be created, captured, and shared to make the firm more valuable.
Many of you will have the opportunity to buy into your firms at some point. What better time than now to start making your future investment more valuable? My hunch says, that promoting knowledge sharing initiatives as value creation will also capture the full attention of your firm’s current ownership. “Would you buy your firm?” might just be the perfect question for aligning all of the stakeholders in your organization.