“Soft” or People Factors influencing the bottom line and value of your business.
Posted on August 06, 2018 by Stefan Voswinkel, One of Thousands of Business Coaches on Noomii.
People factors are really the hard factors, impacting profits & business value. Especially if you want to transfer/sell it, soft factors are critical.
Thought-Provoking Position Papers for Business Owners
People Factors impacting the bottom line and value of your business:
• Dealing with conflict in the family and the business: Unresolved conflicts cost time, energy and money.
• Quality of internal and external communication: Lack of communication has financial and social costs: Assumptions, silo mentality and lost opportunities.
• Staff turnover: Check the reasons if your turnover is high. Long-term loyal people carry the business!
• Professional development: Help your people live their potential. Get mutual clarity about where they can go. Keeping good people means money saved for hiring and training, plus better customer service.
• Clarity of roles and responsibilities: Do you have an org chart and job descriptions? Proper delegation, clear reporting relationships and accountability will reduce stress and improve productivity and your bottom line!
• How do you transfer your “Business Magic” to the next generation? A good part of your recipe for success is intuitive. You need to lift it to the conscious level so you can transfer it to your successors.
• Change is a given. How do you help your people with adopting a change project, training them and asking for their feedback? Most projects fail because the people side wasn’t managed properly. If you have a culture that embraces change, then your employees are also much more likely to stay with the company when you sell or transfer it. The new owners will pay you extra for change readiness!
• Stability in supplier and customer relationships. Do you measure that? It pays!
• Do you have a plan of transitioning management of the business – how and to whom? Lack of clarity and possible disruptions carry a cost!
Sale of your business or transition to the Next Generation: Create a transferable structure in your company that is sustainable without you. Build a top team. Create the resilience required for sustainable success. That’s what a buyer will pay for!
Here are selected “hard” factors impacting the bottom line and value of your business – all of them have a people dimension that needs to be managed:
• Budgeting process. Do you have one?
• Relevant and timely information from good IT systems
• Inventory management. How is yours working? Real time information?
• Having a business strategy and executing it well
• Are you prioritizing high margin business and shedding low margin business?
• Are you investing in new equipment and performing preventive maintenance?
It’s when you want to sell (or transfer) your business when you find out how well you have managed it.
Determine where you are at: Do a Business Health Check!
Start early – it takes time to maximize bottom line and business value!
© All rights reserved, Stefan Voswinkel, President of YLynx Management Consulting, Inc.
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Stefan Voswinkel
The ChangeHound
I “bite” – You transform your Business
stefan@voswinkel.ca
Direct: 001-867-335-5969
