Don't Leave Your People Out In the Cold: Start Transferring Institutional Equity Today

Commitment and competence are not enough. Sometimes even the most dedicated team can risk being left out in the cold for lack of a crucial tidbit of knowledge.

I was reminded of this recently when  enjoying  Monarch of the Glen, a BBC production about a titled Scottish family desperately trying to hold the castle estate together with little more than good intentions and duct tape.

In a recent episode Lexi, the very efficient but temperamental cook, walks off the job. At the same moment the century old furnace conks out.  The hapless family assembles around the furnace armed with wrenches and hammers, confounded as to a fix.  Thankfully Lexi hears of the troubles and despite her temper, comes to save the day.  She saunters up to the furnace, lifts a rusty control panel cover and pushes the big red button. Wa-La - the furnace ignites, disaster is averted!

Many business owners fail to avert their own disasters by transferring their own ‘Institutional Equity’ to their successors, or management team members. Institutional Equity is value you bring the organization that reaches far beyond your ordinary duties because of the things you know about the institution.

Just because you know about the red button in your organization does not mean that your management team does.

More importantly, to our conversations about transfer of ownership, Institutional Equity is information that may seem to be of secondary importance until it is required to solve a problem. Lexi’s knowledge of the red furnace button, perhaps mundane on most occasions, was critical on another. But until that evening, knowing about the red button didn’t seem to Lexi worth passing along. 

The same thing can happen to you.

Over the course of your career in your business, as perhaps the founder and certainly as the owner, you have amassed a wealth of ‘secrets and tips.’ It is those often proprietary or intangible bits of knowledge, proven approaches or unique enablers that make the business operate more efficiently and effectively.  

In order to smooth transition, and build ongoing value in your company, you must find a way to systematically impart your unique approach and knowledge to your key managers.

In your business, do you know what these tidbits are?  Have you shared them in an orderly and systematic fashion?  If not here are 5 Questions to become an Institutional Equity Champion like Lexi:

Why is it important?  The obvious answer is to reduce the risk of transition.  Remember- acquirers, both external and internal, want to eliminate risks in operating the business and your insider’s information is the key to a more favorable valuation, and terms.

When should you start?  It takes time to share a life time’s worth of wisdom so start today.  The best way to convey vital information is in real time.  As situations arise it is the perfect opportunity to share your perspectives and problem solving approach with key managers. This real time learning lab will demonstrate your confidence in your managers, and they may even surprise you with their enthusiasm to learn and excel.

How should you start? 

 Step 1: Become aware of the information and analysis you use to make decisions. 
 Step 2:  Become intentional about sharing these tidbits. 

 Step 3:  Write down these points. 
 Step 4:  Share them at your management team meetings or one on one sessions.                                 Make them a regular feature of your leadership approach. 

Who should you share this information with? Obviously share this information with your key managers, especially those on your leadership team.  But you may also consider those beyond your inner circle who could benefit from your wisdom.

What is worth sharing?  All information that is exclusive to you is important.  But that may be a long list. So I suggest starting with these three: 

·    The People: key relationships with external partners (customers, vendors, advisors such as accountants, bankers, attorneys, etc.)

·    The Facts:  financial information, company documents and commitments, performance targets and acceptable variances, etc.

·    The Processes:  your problem solving and management approach to specific operational, talent, finance or sales problems.

If you master these 3 areas you will be building value in your company each and every day.  You will see the pay off now in the form of improved performance, and when it is time to transition. 

Your institutional equity is one of the most significant assets you have, but it only becomes valuable if you transfer well ahead of handing the keys to the next owner.

Please post your thoughts and questions below. I enjoy hearing from business owners who are building value and preparing for transfer.

Other blogs in this series:

1) A Surefire Tactic to Improve Your Valuation at Exit: Mind the Gap

2) Cash In at the Hand Off

Cash In at the Hand Off

In a prior blog, A Surefire Tactic to Improve Your Valuation at Exit, we featured the #1 action you can take that will absolutely pay dividends at transfer:  invest in your management team.

A Kaufmann Foundation whitepaper on valuation indicates professional investors weigh the strength of the management team as 3X more valuable than the quality of the sales channel; and 2X more valuable than the competitive market position. 

Acquirers, both strategic and financial look for exceptional teams and will pay up for them.  They view bench strength beyond you as a way to guarantee performance, and reduce operating risk once you transition out of the company.  Think of your management team as the baton you can pass on to the new owner.  The smoother you can pass it on, the less likely they need to slow down during the hand-off.

But the same is true for you.  The more nimble the hand-off, the more quickly you can keep running toward your exit, without tripping or stumbling which could cost you money.  A Pepperdine University study reveals that 39% of reported business sales and buyouts involved owner earnouts and 30% require seller financing.  That means a significant amount of the value exchange occurs post sale, and is dependent on the future performance of your company.  And who will be primarily responsible for hitting the numbers?  Your management team of course.  So ensuring your team is ready insures you receive the full value you negotiated.

Can You Count on a Payoff?  

First, take an honest look at your team. Are you concerned your team:      

• May bumble, stumble, or heaven forbid, grumble when talking to potential acquirers?
• Can’t stay focused on the important priorities without your continual reminders?
• Is satisfied with status quo, but growth and new ideas are critical to a successful exit?
• Based on their track record doesn’t have the skills to manage the change of transition?

If the answer is ‘Well maybe’, take look at the numbers.  Most team improvement workshops cost less than $15,000.  What if during the workshop the team uncovered a way to improve your $1million cash flow by 5%, that’s an incremental $50,000.  The exit value implication at a 5X multiple is $250,000. And if through the impressive skills, and leadership strength of your team, the multiple improves to 6.5X, the value implication is now $325,000!  And if your deal, like so many others requires an earnout and seller financing, the impact to your pay out could grow, quickly!

Now, why wouldn’t you invest $15,000 and a few days with your team to realize $325,000 or more? 

Get Started Building Your Dream Team

Most teams have not been taught how to be high performing, leveraging the strength of each member and the range of skills in the team, to achieve exceptional results.  In fact, most teams don’t know what bogs them down, gets in their way or how they may even be sabotaging their own success. 

But with the right type of team workshop, a good consultant will help the team transform itself.  Here are 3 critical elements to look for:

1.  An application focused workshop with an emphasis on problem solving exercises.  The primary work of an executive team is identifying and solving problems together.  Zeroing in on this aspect helps the group understand what they are doing well and poorly in this crucial area.
2.  An emphasis on participation, not lecture.  Adults learn through doing and self-discovery, and are motivated to excel when implementing ideas they create and support.
3. Team developed action plans and goals for a specific company challenge as the primary workshop outcome.  A key to a high ROI is devoting workshop time to addressing a real life issue, and solving it. 

The Results to Expect

Just like using a personal trainer will take your workout, golf game, etc. to the next level, so too will investing in your team. It’s not just about learning new skills, it’s about inspiring the team to excel beyond your expectations. It is a proven fact that people set higher standards for themselves than their manager does. So providing an environment where your team can renew their commitment to a level of excellence is a gift to them, and a great investment for you.

Ask you Director of HR for recommendations, or feel free to call us. We are happy to help you find the best consultant to transform your team and maximize your exit value.

Looking ahead

In our next blog in this series we will feature the transfer of your institutional equity (aka your knowledge of the business) to potential successors or your management team. 

A Surefire Tactic to Improve Your Valuation at Exit

Mind the Gap!

When I saw this phrase in the London Tube I was perplexed. What gap?  Where?  Why was this warning plastered all over the walls and floor of the subway stations?

Then as the train approached the platform and a thundering herd of commuters jockeyed for position on the trains, I soon realized the warnings purpose:  the Gap to be Minded was between the curve of the platform and the straight line of the train.

In that small and seemingly insignificant space tremendous danger lurked. A missed step is all it would take to lose a foot, or worse.  And then it hit me.  The Gap is where all danger resides.  And so often we overlook the Gap, especially when it seems inconsequential.

So I have made ‘Mind the Gap’ my mantra because it is where overlooked risk resides. And as a business owner, it is the number one place you should focus when evaluating your exit strategy.

You are not alone if your Gap looks like:

• Running out of time to ‘fix’ the company before needing to transition.
• Realizing the business is overly dependent on your relationships and reputation with customers, vendors, professional advisors and bankers.
• Acceptable, yet somewhat status quo operating performance, and little motivation among your key managers to change.

As you examine the Gap, does it seem to grow deeper, and darker? 

What you are looking at is a Value Gap:  characteristics of your business that will increase risk and marginalize performance.  And this means not getting top dollar from an acquirer.  External buyers will compare your business to others, especially as the market gets crowded with other sellers hoping to exit. If a buyer sees impediments to growth, marginal performance or an over reliance on your management of the company, they discount your value, or worse take a pass.  

How to Bridge the Gap?

There are dozens of good solutions but only one that will absolutely yield a positive ROI: invest in your management team.

A Kaufmann Foundation whitepaper on valuation indicates professional investors weigh the strength of the management team as 3X more valuable than the quality of the sales channel; and 2X more valuable than the competitive market position.  This is because management teams make things happen.

Getting your key managers on top of their game prior to exit will increase that valuation multiple. But it will also improve the business basics like top and bottom line performance. Buyers see this and conclude the prospects are good for future performance, reducing their risk and increasing your reward!

Three Mission Critical Action Steps to Improving Management Team Value

Focus your attention on these pivotal activities and you will realize a substantial ROI:

1. Provide your key managers with the skills and motivation to function as a high performing team.
2. Transfer your ‘institutional equity’ to your successor, or to your management team members.
3. Keep key managers engaged with compelling incentive packages which support your exit goals.

Acquirers, both strategic and financial look for exceptional teams and will pay up for them.  As an owner, you want such a team too. 

So start Minding the Gap by investing in your team today. You can begin by making a few lists:

• What are your team’s strengths and weaknesses?
• What do only you know that is critical to company success?
• What incentives do your managers have to stay with your company?

In our next three blogs we will share details about how you can implement each Mission Critical Action Step to improve management team value.  Check back often to make certain you don’t miss these surefire tactics to achieving your valuation goals.

How Exploding Trees Could Derail Your Exit Plan

I was duped, and I didn’t know it.  And worse, I shared the story with just about everyone I met.

It was innocent enough, and my intentions were good. But just the same, I was guilty of spreading mis-information and there was no way to right the wrong.  But after all, it was an April Fool's prank, and here’s how it all started.

Several years ago while driving to my office, NPR featured a story about exploding maple trees.  Yep, that’s right- the dangers of a little known occupational hazard facing the sap gathers of the woods of Vermont.  Seems that due to extreme cold weather, and a quick warm spring, the pressure of sap had built up, and when the trees were tapped- kerpow! Interviewed sap collectors reported incidents of fatalities, maimings and even several people being decapitated when tapping the trees! 

Immediately my thoughts were spinning

Where was OSHA when you needed them?  Why wasn’t someone doing something about this tragedy? No wonder real maple syrup is so expensive! 

I was incensed that such an occupational hazard could go on unchecked. So I told everyone I met about the exploding maple trees in Vermont, and I encouraged folks to boycott maple syrup as a means to rectify the injustice. 

I continued my social conscious raising efforts until one weekend in late April when I told a friend who happened to hail from Maine.   Doug asked where I had heard such a story. I answered “NPR, so it must be true!”  Doug told me maple tree sap dribbles out, and could never build up enough pressure to ‘explode’. Then he asked, when I heard this ‘news story’.  I told him ‘a few weeks back’.  Doug said, “Could that have been April 1^st?”  OMG- I had fallen for an April Fool’s joke, and a great one at that.  We all had a good laugh, until I realized I had told dozens of others about the exploding trees.  Hopefully not too much harm had been done to maple syrup sales. 

Although NPR is typically a credible source, on April 1^st   they try to dupe their audience, and I fell for it. Which taught me a lesson:  rumors get started, often innocently, and can spread like wildfire. 

Could this happen in your business?

You bet.  Human resource communication experts say 70% of employees get their company related information through the grapevine. And of that, only 20% is accurate, the balance is mis-information, or simply made up. 

Why does this happen?  Well, these same experts note that employees share stories to build relationships.  But they also share ‘information’ to impress others and feel important.  And if the messenger is perceived as credible (like NPR), most folks (like me) don’t bother to check the facts.

As a business owner, and perhaps one who is considering a transition plan, you may be subject to the exploding maple tree phenomena. After all, your employees know you won’t stay in the business forever.  And in the absence of any formal communication, they may look for nuggets of information to fill the void.  But just as the experts warn, most of the data will be flawed.  And the more outrageous it is, the more compelling it is to spread the flawed ‘facts’.  And next thing you know, your employees have you selling the business to a nameless villain from East Oshkosh who intends to close the place down and move the operations to northern Siberia.

Outlandish, perhaps. But so are exploding maple trees.

So as you contemplate your transition strategy, be honest with your employees.  They realize you will eventually be exiting, and better that you share the when and how versus their imaginations creating your exit plan for you.

 

Perks Aren’t Priceless if They Cost You a Fortune

They say March comes in like a lion, and out like a lamb.  And we seamlessly slide into spring, with balmy afternoons, and perhaps the temptation of an afternoon out of the office.  After all, winter has been pure drudgery, nose to the grindstone, and a break is well deserved, right?  Well perhaps, if you appreciate the benefits, and understand the trade-off that comes with a well earned perk. 

Owning your own business means you can make all your own choices, and create the environment you want. 

You also create the long-term company value you want as well. 

Perks like Friday afternoons at the golf course or at the marina feel like rewards because they are valuable to you.  And having the luxury of arranging more of these afternoons becomes even more valuable over time. And eventually, it’s every Friday.  After a while, this freedom and flexibility feels like an entitlement of ownership.  And why not, you worked hard, and you own the place.

But be aware, this valuable new flexibility has a price:  Lifestyle Value.

You may have friends who have built lifestyle businesses, often sole practitioner professional services where revenue generation equals the owner’s living expenses, with minimal equity value accumulated over time.  These lifestyle businesses are designed from the outset (whether consciously or sub-consciously) to be enterprises with value that is only as great as the boundaries of the owner’s lifestyle needs and abilities to provide a service. 

But that is not what Lifestyle Value is about.  Rather, it’s about the little perks, or choices you make which marginalize the value of the business. Think of it this way. Your company’s value is like a pie, and each time you make a ‘perk’ choice, you are increasing the Lifestyle Value piece of the pie. The downside is you are decreasing the other slices, namely the business or investment value of the company. 

Occasionally, opting to capture some R&R reflects solid work/life balance, and personal priorities. But, if you intend to sell your business to a third party, especially in the next 2-3 years, be aware that this Lifestyle Value is non-transferable.  Just like an airline ticket, there is no buyer or market for your seat because the ticket’s value cannot be exchanged. 

Often Lifestyle Value accumulation is insidious.

It creeps up, and creeps up until one day you look around and realize you, and maybe the business, are coasting.  And all the value you created has flat lined.  Rather than invest, and take risks, you have been opting for rewards; perks replaced performance as your metric of success. 

Here are 3 signs you may be at risk for Lifestyle Creep:

1.       Time away from the business is driven by a desire to ‘escape’, and avoid the difficult decisions and challenges associated with continual reinvestment in the company future.

2.       Life is too short attitude, taken to an extreme, such that you use an increasing portion of your thinking time planning personal pursuits vs company initiatives.

3.       Coasting has become status quo- for your key managers.  Your team follows your lead, so if you see them coasting, you may be coasting yourself more than you realize, and you may have established that as the new pace of the organization.

If you do see signs of Lifestyle Creep, think about the value implications.  You can choose to redirect your energy, and get back on the value building path. 

Or maybe it’s time to consider planning your exit before too much non-transferable Lifestyle Value has been accumulated.  After all, you don’t want to be stuck with a worthless, non-refundable ticket.

 What do you think? I am interested in your thoughts about where the line between reasonable perks and Lifestyle Creep lies and how we can all be more aware of the early warning signs. Please post your comments and questions below.

 

Run the Race Like a Champion- a Change Champion!

As any relay runner will tell you, passing the baton is wrought with fear and anxiety:  What if I drop it? What if I misstep and trip? What if I fumble and I lose momentum?  I am certain business owners have exactly the same fears, and anxious moments, especially as their transition date draws near.

Wade, an owner of an industrial products company was quickly approaching his target departure date.  He had been planning his exit for some time now.  He had found a private equity investor to buy out most of his shares, he had his CPA organize his tax situation and he even had his attorney draw up a new will. 

But the one thing he had not done was decide who should take over the business once he left.

And really, he couldn’t explain why. He had two terrific candidates to choose between.  Bill, his right hand guy for years, who knew just about everything about the business was a good option. But then so was Kim, a bright young, eager VP of Sales who had usurped Wade as the company’s number one rainmaker.  Both were equally talented, but both had their downsides too:  Bill was an introvert and not a great communicator; Kim was a people person but avoided details like the plague.

So what was stopping him from choosing?  Fear!  Fear that one would leave if the other was chosen?  Maybe. But actually the fear was deeper than that. What Wade feared most was how to handle the situation.

Passing the baton involves change; and Wade didn’t want to face the changes he knew would arise when he made his choice known.  Wade often thought about how Bill or Kim, or other employees would react to the change. He even worried about how he would react.  Wade thought about change as something that happened to people. He didn’t realize he could be a champion of that change.

Change champions are courageous leaders because they know how to proactively lead others, and themselves through change. They know resistance to change is a powerful human trait that can be overcome by understanding why people don’t like moving out of their comfort zones.

Are you facing a change like Wade?  If so, here are a few simple ideas you could use to become a change champion:

1. Be transparent and communicate.  Uncertainty is at the core of resistance so understanding the what, why and how behind the change is critical to reducing apprehension.  Go beyond the obvious benefits to the company, stress the benefits to everyone involved. People are motivated to change if they see themselves benefiting from the new situation.

2. Assume success by planning for it.  When introducing the change, get people to envision their role in the process, and their contribution to the successful outcome. By encouraging their participation, and anticipating success, commitment to action will ensue.  People like to belong, and feel important. You can provide the opportunity for both through their support of the new initiative.

3. Be honest about what’s fair, or not.  Choosing a successor is always tricky, even beyond the individuals involved.  People have invested in alliances and relationships, and disrupting those can feel unfair.  But people will move toward acceptance if they truly trust the change leader.  We all hear things more favorably from a friend than foe.

4. Reward and encourage, even the small steps.  People like to be on a winning team, so be the coach that creates a winning environment.  Notice when your employees make positive moves, speak favorably about the change, and become helpful to the cause.  Each of these actions demonstrates they are gaining acceptance, and a good coach notices these small, but vital contributions.

If Wade had these tips, he may not have hesitated so long about choosing the best leader to succeed him.  Introducing such a change is daunting, and can cause many a sleepless night. But if you champion the change using these concepts, and perhaps a few other tactics, your leadership will be rewarded, and your future will be a step closer.

Please comment below and let  me know what questions you have about championing change for your organization.

Be a Storyteller to Maximize Value

When considering value creation options, you need to think about the story you want to tell future investors or owners. 

Will it be a story about explosive market share gains?  Rapidly rising revenue in a new product line?  Expanding profitability?  Declining SGA expense ratios?  Dizzying free cash flow?  It would be great to tell a story of all this and more. But chances are you aren’t telling the Zappos story. 

The reality for most owners is their best story hinges on a few well-conceived strategies, executed brilliantly.

But it also hinges on the target audience.  Who do you want reading your story, and why?  And when do you want them to read it? And most importantly, how do you make it more compelling than the other stories they read?

The answer: start writing your story today!  Maximizing the value you can command in today’s market is a direct function of the quality of your story.  It is what attracts a highly qualified investment banking team to represent you in the sales process. It is what will make your company stand out among all the other baby boomer business owners who want to exist. And it IS what buyers pay a premium for.

Of course, the story is not a fictitious tale of your company, or even a well written description. It is the retelling of your business attributes and accompanying performance, your track record of success, and the yet unwritten potential a new owner could capitalize upon. 

It’s a story of the past, the present and most importantly, the untapped future.  

External buyers’ greatest fears are about sustainable financial performance, and future potential.  The first proves value, and provides the fuel to realize the second.  Mis-stepping on either of these leads to the #1 fear: paying too much.  Which for the exiting owner means getting too little.

So how do you tell a great story?  Well, a great performing company is a good start.  But you also need to begin drafting your story so your business shines, and entices the ’reader’ to delve deeper, understanding the nuances, savoring the details and finally becoming part of the story themselves. 

The goal:  the reader forms a vision of the story’s end in which he is the successful protagonist.

So here is how you can start today: 

Get yourself a notepad and start by answering these questions:

1. Every story has colorful characters, who are yours?  Your key managers? Talented engineers? Rock star sales people? License bound customers?

2. What is the setting?  Describe what you see- a highly organized work environment? A highly competitive marketplace?  Well oiled operations and procedures?

3. What is the theme?  Organic growth?  Expanding profitability through new products? Exceptional expense control?

4. What about the plot line?  Burgeoning list of new customers in a down economy? Defying industry trends through innovation?  Capturing greater share of wallet through data mining and customer cross selling?

After you have drafted your thoughts, put the pad away for a few days. 

When you revisit your answers, ask yourself these questions:

1. Is this a compelling story?

2. Does it portray a positive, optimistic, ‘success is certain’ trend or a dark and stormy narrative of impending doom?

3. Do you like the characters? Would you be drawn to working with them?

4. Is the environment attractive?  Would you want to visit? Would you want to stay?

5. Does the theme make sense?  Does it dovetail to the plot line? Is it all believable?

If the story is not exactly what you had hoped for, you are not alone.  Business owners are often so buried in their business, they cannot see their business as others would.  This is why having an advisor who understands how to write the story, and even shape the story as it happens, is critical to maximizing your value. Your buyers want a story they can believe, proudly share with others and have confidence will come true.  To achieve this you need to be certain you are writing the right story, starting today.

Feel free to share your company's story in the comment area below. I would love to hear it.

3 Habits That Can Sabotage Your Exit Strategy

You’ve decided it’s time to retire, time to get out.  Good for you. But Beware:

Exiting your business is like going on a family road trip.  The destination may be set, the course mapped out, the pool bartender alerted to your ETA. But you can suddenly find you are stuck in the driveway, with a car load of bickering family members.  What seemed like a good idea can start to feel impossible.

 

The same is true for even the simplest tasks involved in exiting your business.  For example, imagine that a potential buyer is interested in your business but has questions about your customer base. To help increase your company value you decide the sales and operations teams need to change the customer relationship management system. Seems simple enough. Right?  But if you are like many business owners you might find that as soon as you suggest this all you hear is grumbling in the hallways, complaints in the break room and drama all around. 

It can leave you thinking “If I can’t get the small stuff done, how will I ever get out?”

You are not alone. Many business owners get stuck by the ‘people problems’ when starting down the road to exit.  But you don’t have to stay stuck, if you know:

The 3 misconceptions which can sabotage your exit

1. Small changes are no big deal.
2. Keeping secrets is OK.
3. The secret to success is to Just Do It!

Not paying attention to these misconceptions is like not paying attention to the basics when planning your family trip. Before you call in a mechanic to rebuild your engine you might want to check the obvious first: gas, oil, air in the tires, keys? 

The same is true for your business. Before you start diving into the perfect upgrades to your record keeping system or how to avoid taxes when you exit, it pays to start with the basics. And just like you can’t go anywhere without your keys, you can’t exit without paying attention to the number one obstacle to a smooth transition- the way most people handle change.

If you want to transition out of your business smoothly, then you must be a change savvy leader.

People hate Change

A small change may seem like low hanging fruit, but don’t underestimate its impact on your employees. A small change, even one beneficial for the entire company, can invoke fear and anxiety.  That’s because our brains are wired to approach the known, and avoid the unknown.  As humans we find comfort in routine because it is low risk, and it’s easy.  When asked to change that routine, we resist it. Often people get consumed with negative thoughts about the change, ‘what if I don’t know how to do it?’ ‘Why do I have to change? Why don’t they start first?’, ‘This seems too complicated. The old way was easier.’ The key is to remember that people are avoiding the change because it is unknown, not rejecting the change because it really is a bad idea.  Your challenge is to get them to approach the change positively.

Fear stops us in our tracks

One way to shift employees’ perception of a change is to bring them behind the curtain.  Remember how Dorothy, the Lion and Scarecrow shook from fright when the Wizard of Oz spoke?  Not knowing who the Wizard was, and why he was issuing such commands, was terrifying.  But once Toto revealed the secret of the Wizard, his requests lost their power to intimidate. So too with your exit plan. If your employees don’t understand the why behind the new process, there is little motivation to get on board.  Although revealing your complete plan may be premature, providing context and the benefits to everyone will minimize the avoid response, and engage the coveted approach response.  Obviously, it makes more sense to emphasize the carrot than to simple bellow “Bring me the witch’s broom!”

This leads me to the final misconception, which is about issuing commands. 

People don’t do what you tell them to do- they do what they want to do

‘Just do it!’ is a fine slogan for Nike, but a lousy communication approach for any leader.  As we all know, adults don’t respond well to directives (again think about the Wizard). Rather, once employees understand what needs to change and why, the next step to getting them fully on board is to ask them HOW. How would they do it?  You set the objective, but you let them weigh in on how it gets done. Providing this sense of control minimizing their avoid response, encouraging them to approach an opportunity to influence the outcome. Seek input to stir up enthusiasm.

Getting unstuck is really quite simple if you remember these tips:

1. Approach/Avoid is a natural response to change.
2. An understanding of why the change, and what’s in it for me, reduces resistance.
3. Offering control will encourage change participation.

So, whether you are just dreaming about your exit journey, or you have started down the path, take time to do a quick inventory: what needs to change, why and how. Then make a list of actions you can take to avoid the 3 Misconceptions, and approach your transition with confidence.

Please feel free to come back and post a comment with your results, and which actions were the most helpful. I would love to learn about how you thrive during times of change.