Small companies though faster and nimbler than larger companies and MNCs, do experience headwinds, hit a growth plateau and face uncertainties. Small companies are faster because of the founder mentality, which is a sense of mission and a passion for front line customers. They have a deep understanding of what their customers want. This is what makes them successful. However, smaller companies tend to be very dependent on a few customers. They find it difficult to sustain their effort in the long run. The owners of these companies usually depend on preferential access to clients, capital and talent to achieve initial success. Replicating this pattern in the long run is difficult. To be sustainable in the long term needs an ability to scale. At this stage, founders are faced with two options – grow and transform the company so that it can be sustainable. Or, they often think of exiting the business due to challenges in succession, lack of ability to invest etc. Even if they need to sell the business, there still is a runway to grow and transform the business for sale. Though the two options involve undergoing a transformation of sorts, the agenda and goals will be a different in each.
It is clear that companies, whether old economy or start-ups, need to work on a few areas before they sell out. All of these companies seem to be adding value somewhere which is what makes them attractive to buyers. Start ups in Israel take 4 years to sell out and on an average make 7 times their Return on Investment. In France they take 7 years to sell out and the ROI is less than 4. German companies too an average of 4 years to sell out, and their return was 2.5 times their initial investment. For most start ups, it is new technology which others think will be the next big thing. But there are lot of investors like Warren Buffet and large corporations, which make strategic investments to park their cash safely, especially given the uncertainty in the global economy. For them, old economy companies that can deliver regular dividends and has a self sustaining business will always remain attractive. Hence the question is what companies need to do to transform themselves to sell. Asian paints for example bought out the brand and entire front end sales of Ess Ess bathroom products, because of the capability Ess Ess had developed in this area. French company Lactalis acquired Tirumala Milk products for its niche products and infrastructure that it built over the years. Be it chemicals, pharma or engineering, M&A of small companies have been happening for various reasons like the people and skills possessed, functional competencies, benefits of integration to the buyer, regulatory clearances available or strong presence in the value chain.
Scaling up a business is not easy. Many start-ups, family business or professional run firms fail to scale to next level of operations. In this white paper, Browne & Mohan consultants share a framework that is successfully employed by companies to guide their scaling up process.
Common traits of successful family business: why some thrive, while other fal...Browne & Mohan
How families build structures and process for managing the business and the family matters in the continuation of their family business. In this paper, Browne & Mohan consultants share common traits that associated with families that have survived multiple generations.
Family business transformation is complex and messy affair. Family businesses must not only untangle the tightly intertwined family from business, but also bring business focus into the family. Successful family business transformation requires thorough planning and diligent execution. In this paper, Browne & Mohan consultants share the steps a family business must pursue to remain competitive, sustain their relevance and grow over coming generations.
Align HR with Evolution of Company: An SME PerspectiveBrowne & Mohan
In this paper Ms. Indupriya S brings her insights on how to align your Human resources as your company grows and transforms from a SME to a larger company.
Family businesses account for significant part of the UAE economy. Family businesses dominate automotive, retail, fashion, real estate and manufacturing sectors. Family owned enterprises represent 90% of the businesses community in UAE and they contribute about 75-90% of the $500 billion plus trading activity. However, they face challenges on business continuity, succession, diversification, and professionalization front. In this paper, Browne & Mohan consultants present the approach to transforming UAE family businesses.
13 lessons for sme business transformationBrowne & Mohan
Browne & Mohan has had the privilege to work with Small and medium companies that pursued business transformation to improve their market relevance and financial sustainability. In this paper, we share 13 lessons gained from successful SME business transformation.
Browne & Mohan consultants conducted a survey on what factors constitutes the best workplace or a place where employees would love to work. Findings show three aspects which influence an organisation to move towards being a 'lovable workplace'.
Scaling up a business is not easy. Many start-ups, family business or professional run firms fail to scale to next level of operations. In this white paper, Browne & Mohan consultants share a framework that is successfully employed by companies to guide their scaling up process.
Common traits of successful family business: why some thrive, while other fal...Browne & Mohan
How families build structures and process for managing the business and the family matters in the continuation of their family business. In this paper, Browne & Mohan consultants share common traits that associated with families that have survived multiple generations.
Family business transformation is complex and messy affair. Family businesses must not only untangle the tightly intertwined family from business, but also bring business focus into the family. Successful family business transformation requires thorough planning and diligent execution. In this paper, Browne & Mohan consultants share the steps a family business must pursue to remain competitive, sustain their relevance and grow over coming generations.
Align HR with Evolution of Company: An SME PerspectiveBrowne & Mohan
In this paper Ms. Indupriya S brings her insights on how to align your Human resources as your company grows and transforms from a SME to a larger company.
Family businesses account for significant part of the UAE economy. Family businesses dominate automotive, retail, fashion, real estate and manufacturing sectors. Family owned enterprises represent 90% of the businesses community in UAE and they contribute about 75-90% of the $500 billion plus trading activity. However, they face challenges on business continuity, succession, diversification, and professionalization front. In this paper, Browne & Mohan consultants present the approach to transforming UAE family businesses.
13 lessons for sme business transformationBrowne & Mohan
Browne & Mohan has had the privilege to work with Small and medium companies that pursued business transformation to improve their market relevance and financial sustainability. In this paper, we share 13 lessons gained from successful SME business transformation.
Browne & Mohan consultants conducted a survey on what factors constitutes the best workplace or a place where employees would love to work. Findings show three aspects which influence an organisation to move towards being a 'lovable workplace'.
Trading companies add value by bringing suppliers and buyers together. To build a successful and growing trading company, there is much to be learnt by bench marking with successful ones, and working on some drivers that will enable the company to unleash growth. This paper discusses some of the drivers for improvement.
Many brands become stale and loose their sheen over years if they can't connect and keep pace with changing customer preferences and market dynamics. Many iconic brands lose their market share and relevance. In this presentation, Browne & Mohan consultants share what is required to resurrect a stale service brand. Resurrecting a service brand must go beyond logo change and consider a complete rehaul of service design, customer experiences, product/service mix and consumption environment.
Mpower: An action-learning approach to leadership development in SMB companiesBrowne & Mohan
Leadership development, unlike management development, is preparing the next line to embrace complex tasks and decision making and build process that enshrine the team to work and deliver higher productivity. In this article, Browne & Mohan consultants share Mpower progragm, an action learning leadership development program that can be effectively deployed in learning by doing and resource considerate SMB environments.
Hanging the shoes in style!!: Planning & Preparing SME family business for p...Browne & Mohan
Family run businesses are a significant segment of any nation’s industrial structure. Exit for family led small and medium businesses happen predominantly through three channels: M&A, IPO or natural death. Unfortunately, many SME family businesses are ill prepared for the ownership transition. Most companies change hands in emergency situations such as illness or death of an owner or partner. Consequently, many SME family businesses (or their heirs) are forced to accept a transaction that is less desirable. Preparing a business for ownership change may bring in many an upside benefits even if the business is not finally sold. The inadvertent benefits that emerge because of planned changes may unbundle the hidden value of the company. In this paper, Browne & Mohan consultants share the approach that could be used by SME family business owners to profit from planned exit.
Governance mechanisms that work in a family businessBrowne & Mohan
Adoption of good corporate governance practices and professionalization help business continuity of family business. This paper presents both formal and informal mechanisms that Indian family businesses of various sizes deploy to improve corporate governance. Formal mechanisms include family assembly, family office, board of directors for each business and independent directors. Informal mechanisms include shareholders assembly, and family outings etc..
Manufacturing is a major contributor to GDP and employment provider in many countries. Both large and MSME are facing effects of global downturn which has made survival a test for many. With customer gains becoming far and few many companies worried about growth and profitability. Browne & Mohan consultants in this paper present the approach manufacturing companies should use to turn around profitability and survival.
360 Degree Marketing: How to benefit from online and offline marketing commun...Browne & Mohan
With advent of online and mobile platforms, marketing managers now have both offline and online marketing assets to increase their brand reach and customer engagement. However, many companies do not plan and execute a marketing strategy that meshes assets available on different media. Moreover, companies do not use an extensive embellished strategy to keep in continuous touch with customers. In this white paper, Browne & Mohan consultants show how to integrate offline and online marketing assets systematically and build a strong extensive content strategy to develop from low cost low information intensive assets to costly high information intensive assets.
Superseva: Building a successful service businessBrowne & Mohan
Superseva is an enterprise services company offering concierge, Rewards & recognition, employee engagement services to corporates. It also offers personalised services to employees of client organizations. This case presents the evolution of the company under the dynamic leadership of its CEO, Ms Kumud Sharma.
Governance mechanisms for unlisted family businessesBrowne & Mohan
Family business need to adopt effective governance practices such as family office and on board independent directors. In this article, Browne & Mohan consultants describe what, when and how to go about implementing these in family businesses
Companies realize without emotional commitment, even the most brilliant strategies will fail. To attain any change, people must not only accept and agree with the strategy, they must buy into it. In this paper, Browne & Mohan consultant share a six stage empirical model of commitment buy-in.
India prison reforms 2020 & State Industry Jail Board Browne & Mohan
Reformation and rehabilitation of jail inmates is a principle laid down in the UN Standard Minimum Rules, 1955, and is the corner-stone of the correctional policy of the Government of India. Most Jails in India offer skill development, work, entrepreneurship and empowerment programmes to the inmates. Most of these initiatives are targeted at creating small manufacturing or agri-based programs with majority of produce for self consumption. In this paper we analyse current programs and suggest setting up of a state level industry Board. The paper desrcibes the structural arrangements and how scale and sustainability can be achieved.
Building an outcome driven high ownership companyBrowne & Mohan
What does it take a build company where every employee owns the quality of their outcomes and productivity , every act is purpose driven. What elements of a workplace make an employee to willingly own and contribute more to her job?. In this paper Browne & Mohan consultants presents the mechanisms that can be used to build an high ownership and outcome driven company
Srishti Software Pvt Ltd has evolved an unique approach to identify and develop lateral transfer of employees. In this paper we capture the framework adopted for identifying stars and performers, how they are supported in their job transfers and their apprehensions managed. Normative do and don't of lateral transfer of employees is presented.
How to use annual plan to set your company for Win !!!Browne & Mohan
At the end of the financial year, everyone makes business plans for the next financial year. The process consumes resources, time, and yet often remains a just another ritual to be followed. This paper discusses why annual plans fail to yield results, and what should be done to make it a guiding document for the coming FY.
Delivering outcome based Business TransformationBrowne & Mohan
In this paper we present an empirical framework of business transformation based on our experience of implementing business changes across several organization. The paper covers the PSPD Framework, drivers of integration framework used and some DOs and Don'ts of Organizational Transformation.
Aftermarket audit to Gain Competitive leadership Browne & Mohan
Industry experts opine that OEM’s and their dealers may be losing $9-15 Billion unqualified sales annually to competitors. Return after repair is a grouse which happens with the iconic brands at dealer level and OEM’s do not have complete visibility. OEM’s and dealers can bill billions of dollars more only if they knew how to constantly manage revenue leakages and manage cost of operations. In this paper, Browne & Mohan management consultants share aftermarket audit framework that can be used to assess current costs of service and operations and identify areas of improvement.
Common Objectives Performance Management System for Not-for-profit and Public...Browne & Mohan
Designing Performance management system for government, public sector and not-for-profit organization is a daunting task. Many of these organizations pursue long-term programs and projects. Alignment of various groups, departments and individuals within each department is the need of the hour. However, many of these organizations suffer from functional silos and focus on financial measures only. Managing for results by directing right staff behaviour and initiative taking is not facilitated. In this paper Browne & Mohan consultants present a common objective approach that could be used to fix accountability, ownership and outcome based behaviour in public sector and non-profit organizations.
Performance Measurement in NGOs is a challenging task as they have both business and social obligations to meet. Traditional accounting measures may not suffice to capture and benchmark growth and other challenges of NGOs. In this paper, we enumerate some key performance measures that could be used by some practitioners.
Is your company reaping ecosystem advantages??Browne & Mohan
Companies are increasing realizing there is a limit to which internal investments and resources can contribute to their sustainable competitive advantage and innovation. Companies need to build capabilities, systems and process not only to generate ideas and paths from internal sources, they also need approaches to identify, integrate and exploit their ecosystem partners. In this paper, Browne & Mohan consultants share what values can each of the player in the ecosystem bring to the company and how they can be systematically harnessed.
The pervasiveness of digital technologies is reshaping aftermarket. e-tailing is gnawing away the market for spare parts as more people are buying online, social media is influencing the consumption of aftermarket services and customers are demanding deeper 24*7 experiences. In this article Browne & Mohan consultants showcase the drivers of digital transformation and adoption for aftermarket.
Trading companies add value by bringing suppliers and buyers together. To build a successful and growing trading company, there is much to be learnt by bench marking with successful ones, and working on some drivers that will enable the company to unleash growth. This paper discusses some of the drivers for improvement.
Many brands become stale and loose their sheen over years if they can't connect and keep pace with changing customer preferences and market dynamics. Many iconic brands lose their market share and relevance. In this presentation, Browne & Mohan consultants share what is required to resurrect a stale service brand. Resurrecting a service brand must go beyond logo change and consider a complete rehaul of service design, customer experiences, product/service mix and consumption environment.
Mpower: An action-learning approach to leadership development in SMB companiesBrowne & Mohan
Leadership development, unlike management development, is preparing the next line to embrace complex tasks and decision making and build process that enshrine the team to work and deliver higher productivity. In this article, Browne & Mohan consultants share Mpower progragm, an action learning leadership development program that can be effectively deployed in learning by doing and resource considerate SMB environments.
Hanging the shoes in style!!: Planning & Preparing SME family business for p...Browne & Mohan
Family run businesses are a significant segment of any nation’s industrial structure. Exit for family led small and medium businesses happen predominantly through three channels: M&A, IPO or natural death. Unfortunately, many SME family businesses are ill prepared for the ownership transition. Most companies change hands in emergency situations such as illness or death of an owner or partner. Consequently, many SME family businesses (or their heirs) are forced to accept a transaction that is less desirable. Preparing a business for ownership change may bring in many an upside benefits even if the business is not finally sold. The inadvertent benefits that emerge because of planned changes may unbundle the hidden value of the company. In this paper, Browne & Mohan consultants share the approach that could be used by SME family business owners to profit from planned exit.
Governance mechanisms that work in a family businessBrowne & Mohan
Adoption of good corporate governance practices and professionalization help business continuity of family business. This paper presents both formal and informal mechanisms that Indian family businesses of various sizes deploy to improve corporate governance. Formal mechanisms include family assembly, family office, board of directors for each business and independent directors. Informal mechanisms include shareholders assembly, and family outings etc..
Manufacturing is a major contributor to GDP and employment provider in many countries. Both large and MSME are facing effects of global downturn which has made survival a test for many. With customer gains becoming far and few many companies worried about growth and profitability. Browne & Mohan consultants in this paper present the approach manufacturing companies should use to turn around profitability and survival.
360 Degree Marketing: How to benefit from online and offline marketing commun...Browne & Mohan
With advent of online and mobile platforms, marketing managers now have both offline and online marketing assets to increase their brand reach and customer engagement. However, many companies do not plan and execute a marketing strategy that meshes assets available on different media. Moreover, companies do not use an extensive embellished strategy to keep in continuous touch with customers. In this white paper, Browne & Mohan consultants show how to integrate offline and online marketing assets systematically and build a strong extensive content strategy to develop from low cost low information intensive assets to costly high information intensive assets.
Superseva: Building a successful service businessBrowne & Mohan
Superseva is an enterprise services company offering concierge, Rewards & recognition, employee engagement services to corporates. It also offers personalised services to employees of client organizations. This case presents the evolution of the company under the dynamic leadership of its CEO, Ms Kumud Sharma.
Governance mechanisms for unlisted family businessesBrowne & Mohan
Family business need to adopt effective governance practices such as family office and on board independent directors. In this article, Browne & Mohan consultants describe what, when and how to go about implementing these in family businesses
Companies realize without emotional commitment, even the most brilliant strategies will fail. To attain any change, people must not only accept and agree with the strategy, they must buy into it. In this paper, Browne & Mohan consultant share a six stage empirical model of commitment buy-in.
India prison reforms 2020 & State Industry Jail Board Browne & Mohan
Reformation and rehabilitation of jail inmates is a principle laid down in the UN Standard Minimum Rules, 1955, and is the corner-stone of the correctional policy of the Government of India. Most Jails in India offer skill development, work, entrepreneurship and empowerment programmes to the inmates. Most of these initiatives are targeted at creating small manufacturing or agri-based programs with majority of produce for self consumption. In this paper we analyse current programs and suggest setting up of a state level industry Board. The paper desrcibes the structural arrangements and how scale and sustainability can be achieved.
Building an outcome driven high ownership companyBrowne & Mohan
What does it take a build company where every employee owns the quality of their outcomes and productivity , every act is purpose driven. What elements of a workplace make an employee to willingly own and contribute more to her job?. In this paper Browne & Mohan consultants presents the mechanisms that can be used to build an high ownership and outcome driven company
Srishti Software Pvt Ltd has evolved an unique approach to identify and develop lateral transfer of employees. In this paper we capture the framework adopted for identifying stars and performers, how they are supported in their job transfers and their apprehensions managed. Normative do and don't of lateral transfer of employees is presented.
How to use annual plan to set your company for Win !!!Browne & Mohan
At the end of the financial year, everyone makes business plans for the next financial year. The process consumes resources, time, and yet often remains a just another ritual to be followed. This paper discusses why annual plans fail to yield results, and what should be done to make it a guiding document for the coming FY.
Delivering outcome based Business TransformationBrowne & Mohan
In this paper we present an empirical framework of business transformation based on our experience of implementing business changes across several organization. The paper covers the PSPD Framework, drivers of integration framework used and some DOs and Don'ts of Organizational Transformation.
Aftermarket audit to Gain Competitive leadership Browne & Mohan
Industry experts opine that OEM’s and their dealers may be losing $9-15 Billion unqualified sales annually to competitors. Return after repair is a grouse which happens with the iconic brands at dealer level and OEM’s do not have complete visibility. OEM’s and dealers can bill billions of dollars more only if they knew how to constantly manage revenue leakages and manage cost of operations. In this paper, Browne & Mohan management consultants share aftermarket audit framework that can be used to assess current costs of service and operations and identify areas of improvement.
Common Objectives Performance Management System for Not-for-profit and Public...Browne & Mohan
Designing Performance management system for government, public sector and not-for-profit organization is a daunting task. Many of these organizations pursue long-term programs and projects. Alignment of various groups, departments and individuals within each department is the need of the hour. However, many of these organizations suffer from functional silos and focus on financial measures only. Managing for results by directing right staff behaviour and initiative taking is not facilitated. In this paper Browne & Mohan consultants present a common objective approach that could be used to fix accountability, ownership and outcome based behaviour in public sector and non-profit organizations.
Performance Measurement in NGOs is a challenging task as they have both business and social obligations to meet. Traditional accounting measures may not suffice to capture and benchmark growth and other challenges of NGOs. In this paper, we enumerate some key performance measures that could be used by some practitioners.
Is your company reaping ecosystem advantages??Browne & Mohan
Companies are increasing realizing there is a limit to which internal investments and resources can contribute to their sustainable competitive advantage and innovation. Companies need to build capabilities, systems and process not only to generate ideas and paths from internal sources, they also need approaches to identify, integrate and exploit their ecosystem partners. In this paper, Browne & Mohan consultants share what values can each of the player in the ecosystem bring to the company and how they can be systematically harnessed.
The pervasiveness of digital technologies is reshaping aftermarket. e-tailing is gnawing away the market for spare parts as more people are buying online, social media is influencing the consumption of aftermarket services and customers are demanding deeper 24*7 experiences. In this article Browne & Mohan consultants showcase the drivers of digital transformation and adoption for aftermarket.
Social media compared to other known forms of media primarily differs on the interactivity and engagement process. This paper presents the process of building a successful social brand.A detailed understanding about what are the steps to be followed from the vision statement to the review has been provided.A list of recommendations has also been enlisted.
Indian government promulgated a scheme (brain child of Dr Abdul Kalam, then President Government of India) to bring urban infrastructure to rural areas under a scheme titled Provision of Urban amenities for Rural areas (PURA). This paper presents the financial assessment of PURA scheme based on data from two states in south India.
A Study of National Innovation Systems of GCC countriesBrowne & Mohan
A robust NIS system is a prerequisite for building a successful nation. With huge amount of wealth at their disposal, GCC countries are taking initiatives to transform themselves into knowledge based economies from oil based economies. This paper evaluates the current NIS of GCC countries, shows where they stand when compared to other countries, and how they can learn from countries like Singapore, Brazil, Malaysia, USA and Norway to make their NIS more effective.
Sales is an area where many companies find the outcomes belie investments and outcomes. Many companies attempt sales transformation in a piece-meal fashion. In this paper, we discuss the framework for sales transformation and five fundamental levers of sales transformation.
Companies of all sizes (SMB to large ones) are finding the current economic environment challenging. Business growth is slow or almost stagnated, new customer gains are far and few, customer spend has become very unpredictable and hence managing capacities is posing a big challenges. Browne & Mohan consultants based on their experience of guiding companies have compiled strategies that can be adopted to successfully maneuver the low tides. We suggest product or service offering changes, organizational changes, employee engagement changes, partner and ecosystem changes, sales and marketing structure changes that are appropriate to most companies.
Stratgic imitation-Road to business growthBrowne & Mohan
Strategic imitation is a low cost, low risk strategy many companies adopt to challenge pioneers and often succeed in gaining higher market share and growth than pioneers. In this paper we describe elements that strategic imitators must pursue to succeed in legitimate copy, learn and improve program.
Sales White Paper: The Growing Sales OrganizationAltify
This White Paper covers the growing sales organization. It will touch on research into different frameworks for explaining company growth phases, and cover the four ages of the sales organization, the pressures at work and the initiatives and requirements for successful business. It will close with an analysis of how the Dealmaker from The TAS Group supports each of the four stages and sustains the organization as it grows and transitions from one stage to the next.
Insights Success has shortlisted "20 Most Admired Companies of the Year 2019 with an intent to acknowledge & admire the novel approaches of these businesses
As organizations strive to sell more solutions, their reps will increasingly face off against a variety of senior- level buying roles. To improve these interactions, sales leaders should adopt a systematic process to help reps. This brief introduces and examines the components of ONE process for selling to senior executives, and explores the options of segmenting the sales force and/or leveraging subject matter experts (SMEs) when looking to reach these buyers.
Seven Steps for Revitalizing Your BrandR. Jay Olson
If the time has come to re-energize your brand, follow this proven framework to get your CEO and executive team behind you to mobiliize your initiative, and ensure your company's investment drives profitable long-term growth and asset valuation.
Some thoughts for any business, consultancy or agency looking to transform and grow through the power of purpose....would love to hear from you
ralph@thebrandexperienceconsultancy.com
Business Models: Six recommendations to enable business model innovation in t...melnorman
Advances in technology have disrupted the creative marketplace. What customers value and will pay for has changed and companies who don’t evaluate their existing business models risk losing their relevance.
There is a lot of discussion around reinventing ‘business models’ and ‘strategy’ but there is a lack of clarity about what this means and even less about how to apply it.
So how does this impact the creative industries, which have undergone more change than most sectors over the last 10 years?
The part time Business Model Theme Champion role, funded by and on behalf of the Creative Industries KTN, focused on transferring current business model practice to the creative industries, using that to shape and inform business model innovation and examine how businesses can better articulate new and emergent business models.
This document is not meant as a scientific document or academic paper but a combination of a summary of my learnings from both my year’s tenure, as well as the thoughts and experiences from those who kindly attended workshops and roundtables or were consulted as experts or as leading companies in their field. My intention is to start a conversation around business model innovation in the creative and digital sectors and for the recommendations to be explored further.
Traditional finance is dead. Business has changed significantly over the last 2 decades. While this has opened up a new set of opportunities to reinvent the concepts of finance, a lot of businesses are being left behind as they grapple with issues that a proactive approach to finance could have easily avoided. All hail the new king of finance – Strategic Finance Thinking.
We get asked every other day by businesses we meet – So what is it that you do so differently? While this has become a part of our standard conversation, we thought of putting these thoughts together in a whitepaper that every SMB can use to define what they should be expecting from this new wave.
Disclaimer: Please note that these are our views are based on our experience in being advisors and working with various organizations. They are for the limited purpose of educating the officers of a company. How this applies to your business can vary significantly based on the context, stage, exact nature & size of the business.
Sales White Paper: Sales Leadership Whatever The WeatherAltify
This White Paper discusses Sales Leadership. It introduces perspectives, ideas, measurements and tools to help Sales Leaders succeed in both buoyant and challenging trading conditions. The chief take-away from this paper is that there are key things sales leaders should be focused on regardless of the economic environment.
Rewiring HR for WFH, Hybrid work & Future of workBrowne & Mohan
Humans working in tandem with automated robots on shopfloors is increasing. Covid 19 induced WFH is here to stay as an economic and resource strategy for many companies. Human resource (HR) departments must therefore rewire themselves to balance work between digital and human associates. HR systems will be driven by intelligence, own change management and design systems for boundary-spanning workflows, collegial support.
Studies indicate that 9 out of 10 businesses have shut down within 5 years after the death of the founder and only about 3 out of 10 survive in second generation. Most family business are designed to fail as they do not address successor planning and training, have poor risk management practices and suffer from interdependencies between the family, the business and ownership. In this paper, Browne and Mohan consultants share how successful family businesses have built resilience to stay relevant and stay resilient in challenging times.
Internal controls maturity and SME corporate governananceBrowne & Mohan
Good Corporate governance is a key factor in ensuring sound financial reporting and deterring misappropriations of capital and resources. Internal control and corporate governance go hand in hand. Many SME
have an ambitious goal of reaching a
reliable, continuous and integrated internal
control state. However, many SME’s are
still grappling to build a comprehensive
control process. In this paper, we present an
internal maturity framework that SME can use to benchmark and know how they can discourage frauds, improve compliance and adoption of standards.
How to transform a family business: insights from the trenches Browne & Mohan
Working with many family businesses across industries, we realize they face a high rate of failure because of their inability to distinguish between family and business issues and build structures and process that protect value across generations. In this paper, we share governance process and systems that are a must for family businesses to preserve and sustain economic and social values across multiple generations.
AI solutions are the most important component of the digital transformation of many companies. AI Startups are racing ahead to address the needs of industries. In this paper, we present the broad strategies AI startups can employ to be successful.
Government of India’s ambitious Skill India program created National Skill development council (NSDC) to create a powerful network of training ecosystem to address employment skills and support gainful entrepreneurship. Despite the best efforts of the government, partners and other agencies involved in the outcomes of Skill India program have fallen short of objectives. The problem of skilling India can’t be solved by increasing expenditure and bringing in more training partners alone. We present here the reasons for the shortfall and approaches to overcome each pain area.
In recent years, many companies are turning their back on “brand investment” and aggressively pursuing what is known as "no branding principles". In this paper, Browne and Mohan consultants recommend approaches to use "no branding" principles for their products and services
Heroes give people a character to aspire, root for and relate to in a campaign story line. Brands have realized ordinary people as hero's can be effective to promote many products/services.
Common man hero may not possess any heroic abilities or strengths but their stories as underdogs winning against many odds, and acting selflessly with a strong moral company inspires and connects with consumers across many segments. In this paper Browne and Mohan consultants share the principles underlying successful common hero branding campaigns.
Many CEO complain they do not see the value in marketing efforts. For them we suggest to use a simple and practical framework, PCCDIO, that has worked wonders for our clients,
Is lack of SEDEX/ WRAP/SA 8000 certification hurting your business?Browne & Mohan
As global trade has expanded, companies have realized a need to implement systems to eradicate human exploitation including bonded labor, safer working conditions and right wages. Several standards have been created to support institutionaization of safer, healthy and inclusive work environment. Standards like SMETA (by SEDEX-Supplier Ethical Data Exchange), SA8000 (by Social Accountability International), WRAP (by Worldwide Responsible Accredited Production), FLA Accreditation (by Fair labour Association), etc have been pushed by the demand side of various industries. In this paper, Browne & Mohan consultants present the advantages of social compliance, how companies must prepare themselves for these standards and how they must sustain their efforts.
Happy Juice principles: How to create a marketing organization that informs a...Browne & Mohan
Many companies spend lot of marketing without realizing the expected benefits. This happens because they simply lack a coherent approach. In this white paper, Browne & Mohan consultants share a proven empirical approach that makes sure your marketing efforts do perform.
Sales operations centre (SOC) is the heart of sales operations. Many companies do not realize the benefits of sales transformation because they under invest in SOC or do not plan & roll it out like a project. The result inconsistent sales reviews, inefficient controls and unrealized outcomes. In this white paper, Browne & Mohan consultants share the best practice approach to build a strong sales operations centre
Many companies attempt internal branding in an ad hoc and unstructured way. Most believe some great quotes, bright decors and greens thrown in makes for internal branding. In this white paper, Browne & Mohan consultants share an approach that can be used to roll out impact making internal branding exercise.
Rewiring marketing: a practice based approachBrowne & Mohan
Many marketing managers are not aware if they are leveraging marketing efforts correctly or getting the returns that they anticipated. Often people believe transforming marketing is all about creating some digital assets. Marketing transformation is not piece meal improvement. The primary purpose of a marketing transformation is to increase the ROI of marketing your company. In this white paper, Browne & Mohan consultants share a practice based approach to marketing transformation.
Influence marketing: dynamics of influencer-brand engagement Browne & Mohan
Influencer marketing is emerging as a strategic approach to inform and influence online consumers. In this paper, Browne & Mohan consultants share the life-stages evolution of influencer and brand engagement. Right from identification to nurturing and reinforcing their relationships, brands need to invest time and efforts to realize the returns from influencer marketing
Rewiring sales organization for growth and scaleBrowne & Mohan
With markets becoming volatile and uncertain, shortening of products and commoditization, sales function is facing huge challenges. Companies need to rewire their sales organization to provide it with enough flexibility, visibility, actionable intelligence and ownership for employees. In this Whitepaper, Browne & Mohan consultants share how to rewire sales organization to set the company for revenue growth and scaling up.
Aftermarket is an important source of revenue for many companies. However, many OEM's face not just revenue leakages, but also ineffective customer and dealer experiences. In this paper, Browne & Mohan consultants share an approach to conduct an aftermarket audit.
Sales casualty analysis: why sales numbers do not happen and what to do to ge...Browne & Mohan
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The Team Member and Guest Experience - Lead and Take Care of your restaurant team. They are the people closest to and delivering Hospitality to your paying Guests!
Make the call, and we can assist you.
408-784-7371
Foodservice Consulting + Design
Senior Project and Engineering Leader Jim Smith.pdfJim Smith
I am a Project and Engineering Leader with extensive experience as a Business Operations Leader, Technical Project Manager, Engineering Manager and Operations Experience for Domestic and International companies such as Electrolux, Carrier, and Deutz. I have developed new products using Stage Gate development/MS Project/JIRA, for the pro-duction of Medical Equipment, Large Commercial Refrigeration Systems, Appliances, HVAC, and Diesel engines.
My experience includes:
Managed customized engineered refrigeration system projects with high voltage power panels from quote to ship, coordinating actions between electrical engineering, mechanical design and application engineering, purchasing, production, test, quality assurance and field installation. Managed projects $25k to $1M per project; 4-8 per month. (Hussmann refrigeration)
Successfully developed the $15-20M yearly corporate capital strategy for manufacturing, with the Executive Team and key stakeholders. Created project scope and specifications, business case, ROI, managed project plans with key personnel for nine consumer product manufacturing and distribution sites; to support the company’s strategic sales plan.
Over 15 years of experience managing and developing cost improvement projects with key Stakeholders, site Manufacturing Engineers, Mechanical Engineers, Maintenance, and facility support personnel to optimize pro-duction operations, safety, EHS, and new product development. (BioLab, Deutz, Caire)
Experience working as a Technical Manager developing new products with chemical engineers and packaging engineers to enhance and reduce the cost of retail products. I have led the activities of multiple engineering groups with diverse backgrounds.
Great experience managing the product development of products which utilize complex electrical controls, high voltage power panels, product testing, and commissioning.
Created project scope, business case, ROI for multiple capital projects to support electrotechnical assembly and CPG goods. Identified project cost, risk, success criteria, and performed equipment qualifications. (Carrier, Electrolux, Biolab, Price, Hussmann)
Created detailed projects plans using MS Project, Gant charts in excel, and updated new product development in Jira for stakeholders and project team members including critical path.
Great knowledge of ISO9001, NFPA, OSHA regulations.
User level knowledge of MRP/SAP, MS Project, Powerpoint, Visio, Mastercontrol, JIRA, Power BI and Tableau.
I appreciate your consideration, and look forward to discussing this role with you, and how I can lead your company’s growth and profitability. I can be contacted via LinkedIn via phone or E Mail.
Jim Smith
678-993-7195
jimsmith30024@gmail.com
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Specific ServPoints should be tailored for restaurants in all food service segments. Your ServPoints should be the centerpiece of brand delivery training (guest service) and align with your brand position and marketing initiatives, especially in high-labor-cost conditions.
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Other challenges exist: Who will use drone delivery the most? Is it cost-effective compared to traditional delivery trucks?
Discussion questions:
Managerial challenges: Integrating drones requires planning for new infrastructure, training staff, and navigating regulations. There are also marketing and recruitment considerations specific to this technology.
External forces vary by country: Regulations, consumer acceptance, and infrastructure all differ between countries.
Demographics matter: Younger generations might be more receptive to drone delivery, while older populations might have concerns.
Stakeholders for Amazon: Customers, regulators, aviation authorities, and competitors are all stakeholders. Regulators likely hold the greatest influence as they determine the feasibility of drone delivery.
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Copy of the presentation given at XP2024 based on a research paper.
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Business transformation - Building the company to Sell
1. 1 | P a g e
Business Transformation –
Building the Business to Sell
R.M Sanjay, Director (Sales and Marketing Group)
rmsanjay@browneandmohan.com
Abstract: Small companies grow quickly & hit a
growth plateau. Founder-owners then decide
whether to grow or sell the business. Even if they
decide to sell, there is need for transformation
and capability building to make the business
attractive and valuable to potential Buyers. This
paper talks about the value drivers along which
to transform the company to sell.
Introduction
Small companies though faster and nimbler than larger companies and MNCs, do experience
headwinds, hit a growth plateau and face uncertainties. Small companies are faster because of the
founder mentality, which is a sense of mission and a passion for front line customers. They have a
deep understanding of what their customers want. This is what makes them successful. However,
smaller companies tend to be very dependent on a few customers. They find it difficult to sustain
their effort in the long run. The owners of these companies usually depend on preferential access to
clients, capital and talent to achieve initial success. Replicating this pattern in the long run is difficult.
To be sustainable in the long term needs an ability to scale. At this stage, founders are faced with
two options – grow and transform the company so that it can be sustainable. Or, they often think of
exiting the business due to challenges in succession, lack of ability to invest etc. Even if they need to
sell the business, there still is a runway to grow and transform the business for sale. Though the two
options involve undergoing a transformation of sorts, the agenda and goals will be a different in
each.
It is clear that companies, whether old economy or start-ups, need to work on a few areas before
they sell out. All of these companies seem to be adding value somewhere which is what makes them
attractive to buyers. Start ups in Israel take 4 years to sell out and on an average make 7 times their
Return on Investment. In France they take 7 years to sell out and the ROI is less than 4. German
companies too an average of 4 years to sell out, and their return was 2.5 times their initial
investment. For most start ups, it is new technology which others think will be the next big thing. But
there are lot of investors like Warren Buffet and large corporations, which make strategic
investments to park their cash safely, especially given the uncertainty in the global economy. For
them, old economy companies that can deliver regular dividends and has a self sustaining business
will always remain attractive. Hence the question is what companies need to do to transform
themselves to sell. Asian paints for example bought out the brand and entire front end sales of Ess
Ess bathroom products, because of the capability Ess Ess had developed in this area. French
company Lactalis acquired Tirumala Milk products for its niche products and infrastructure that it
built over the years. Be it chemicals, pharma or engineering, M&A of small companies have been
happening for various reasons like the people and skills possessed, functional competencies,
benefits of integration to the buyer, regulatory clearances available or strong presence in the value
chain.
2. 2 | P a g e
Challenges
There could also be succession issues where the next generation would like to explore their own life
and not be very interested to run the company. Alternately, the founder’s knowledge could have
been the foundation of the company. It can be a niche technical field where offsprings do not have
the necessary knowledge. At these times, the owner can decide to sell and retire, so that his
offsprings can pursue their passion. But founder run companies rarely are ready to sell.
Dimensions of
Transformation
Build to Sell Build to Grow
Goals
Increase profitability, reduce losses &
wastage, predictability in revenues
Sustainability - Improve and build
capabilities, transform behaviour,
teamwork and coordination
Leadership
Is usually top down, since speed is necessary It is more consensus oriented to elicit
employee commitment, change comes
from bottom up.
Drivers
Structures
Systems
Mobilize resources – eliminate waste
Organize
Financial incentives for results
People, skills
Knowledge, culture
Mobilize resources to invest
Innovate
Skill based pay, corporate wide bonus
sharing
Consultants
Hired to implement and drive change Engaged to elicit and catalyze
employees to own and drive change
Regardless of the path to transformation that is taken, with scaling comes problems like slowness,
that erodes competitiveness. This is the growth paradox. When revenue grows faster than talent,
companies put in place systems. They hire average talent, and the mission becomes a rule book.
Accountability starts to erode. Managers become math oriented, and analyse abstract concepts. In
the old days, the founder and his team would have only talked about the most important customers,
treated resources as if it were their own, and used it judiciously. But now it's not the case. As
companies add functional professionals, the voices from the front line which were part of decision
making, start to fade away, and are replaced by middle managers. But as complexity increases,
founder-owners can be overwhelmed by the new reality and their focus gets diffused. Given this
informal set up, no buyer would be willing to wager a bet on the company. Hence moving from an
owner-controlled structure to a formal one becomes a necessity to overcome this challenge.
Sometimes the owners may not have the right perspective. A 20 year old magazine publication that
had a good circulation slowly saw its circulation fading, and eventually sold out to another
entrepreneur. The buyer did not see value in the physical magazine, but saw immense brand value in
the badly managed website of the old company. He leveraged the brand transformed this into an
online model. The previous owner failed to see this possibility and sold the company as it was,
without working on it.
The owner’s name is associated with the product. The company is all about him. Customers trust the
owne, it is due to this relationship that business grew thus far. The founder is the hub and everyone
reports to him, and all decisions are made by him. He knows it all, and there is rarely any need for
documentation and systems and processes. But in order to derive value out of the company, there is
need to detach ownership from management, so that a prospective buyer has visibility into the
nature of the business. This can involve a letting go of the control by the owner, coaching existing
3. 3 | P a g e
talent to become leaders, bringing in new layer of leadership and making the company financially
attractive.
At the same time, there is need to address the fears of long term employees, and they need to be
carried along as well. Their support in this matter is crucial. Hence how can the owner plan to share
some of the sale outcome with his existing team of core employees while at the same time looking
for a strategic buyer who will provide these employees with a much better career path that comes
with large scale.
How to transform the company to sell
Goal Setting
Founders are passionate about what they have built over the years, they are proud of it and would
like it to be highly valued and taken to greater heights. Many of them would like to continue with
the company – but at the same time
spend more time and energy with
family and other interests which they
would most likely have sacrificed all
these years. But they would still like to
be involved to see their employees
grow and flourish. Others would like to
sell off completely and retire. While
some may have a shorter time frame
and horizon of a year, others would
like to take a slightly longer term view
of 2 to 3 years, and explore how they
can actually build capabilities in the
company that make it more valuable.
The bottom-line is all about improving
profitability, making sales predictable
and de-risking the company. These
goals and timeframes based on
individual priorities determine the way
to go about it and the outcome as well.
Identifying Gaps
When the time frame is smaller, there
is need to bring small and quick
changes in critical areas and functions
within the company. The gaps that
exist within the firm in the form of
individual talent, a second level of
leadership, functional expertise etc
need to be identified. Gaps could also
4. 4 | P a g e
be in the form of missing performance management systems to professionally manage the company,
a weak sales and marketing organization that is reactive in nature, an unsuitable organization
structure that hinders the firm from responding effectively to the market, or systems that are not
facilitating share of information for effectiveness. Benchmarking with competition is useful to
identify these gaps and bridge them.
Identify core and extend
Core business capability of the company needs to be identified. For some companies, it could be
product development, R&D, engineering skill, operations, support, marketing, brand, sales or
channel networks. The contributors to these over time could have been the R&D work done
(knowledge or IP), operational efficiencies brought about, brand, or unique systems of management
that has led to the success of the firm. In building the core, firms could have inadvertently built
inhibitors that prevent it from succeeding in changing environments. Since customers would have
praised the R&D capabilities or perhaps the quality of the product, the company could have focussed
too much on this aspect neglecting or at times not realizing the value of other functions such as
sales, marketing and support. At times, the company could be entirely support driven, neglecting the
ability to spin off something that is core as perhaps a product. Hence there is need to identify these
inhibitors and implement changes to overcome them. Once core of the firm is identified, efforts
need to be made to strengthen the core, and at the same time overcome the inhibiting factors that
will prevent future growth.
Adjacencies around the core have to be evaluated. These adjacencies or extensions could be internal
or external. On the external front, companies might have developed a product for a particular usage.
Being a victim of repeat orders and satisfying business over the decades, their sales team would
have become order takers, and would never explore attractive markets that are adjacent. They may
unknowingly let go untapped opportunities. Or, they may have a set of good customers, but would
never have explored cross-selling their other capabilities, and have not deepened existing markets,
exploring how to expand share-of-wallet among existing customers. In the case of product
extensions and product-market extensions more attention has to be paid to the type of investment,
the effort it entails and the short term benefits. Resources and energies should not be frittered away
on extensions. It is better to strengthen the core product.
Build Capabilities along Drivers that increase Value
Value drivers that enhance value of the organization need to be identified and the transformation
plan should revolve on putting in place systems, processes and people to increase value along these
lines in sales, marketing, alliances, for review and control. The PSPD (Predictability, Sustainability,
Profitability and De-risking) methodology can be used to identify these drivers. Making cash flows
predictable and stable, building customer diversity, de-risking from certain technology platforms,
building and executing a realistic growth plan, systems and procedures, product diversity, an
effective sales engine, human resources and leadership are all drivers of business value. Some of
these drivers are listed below and explained.
Organization capabilities
Capabilities in a company arise from the type of resources that are available, both tangible and
intangible. Tangible resources could be assets and people, while intangible assets are the knowledge
5. 5 | P a g e
base created. Capability building at the fundamental level starts with assets and skills of individuals.
At the initial stages of the organization, such individual skills are critical. As the organization
matures, there is more complexity, and structures & systems need to mature suitably. There is more
need now for functional capability in terms of having an effective sales, marketing, product
development or operations team. Capabilities within these functions need to be built up. If an
organization really needs to exploit these capabilities, all these functions have to work seamlessly.
These cross functional capabilities enable the company to organize itself and develop its business
and grow effectively. At a more sophisticated level, companies will also be able to build the ability to
restructure teams to respond to the environment very swiftly – to form alliances, gain and shed
resources etc. Companies need to have a robust HR platform. There need to be clear objectives,
standard execution method and measures of success. HR policies and procedures should be driven
by employees themselves. The closer decision making is to the marketplace, the more effective is
the organization. But usually, decisions get delegated to the wrong levels in the organization, causing
loss of focus on the customer.
As companies mature in having sophisticated systems, they can lend an ability to even co-create
with customers. The truth is, only few companies will be able to master these socially complex
capabilities effectively. It takes time and effort to develop, it is rare and difficult to imitate, and is
also not visible to outsiders. But even to get better valuation for a company, a start needs to be
made in this direction. Putting these structures and systems in place are effective since they give the
prospective investor a great deal of visibility into the workings of the business. It helps outsiders to
realize that the business is no longer about the owner, but that there is a system functioning
effectively even without the owner. To them, there has to be a return from the investment from a
business that being effectively organized and managed.
Building Organization capabilities in steps
Organizational
Culture
Cross functional
skills
Performance
driven culture
The entire
organization plays
like a soccer team
– with ability to
respond to the
environment at
the very lowest
level
Sustained
performance
advantage
Functional Skills in
the company
Organization
Systems for
seamless
information
exchange
For effective
business
development
Build the next
layer of
leadership
Build effective
sales, marketing,
product
development
functions
Implement
processes
Structures
Owner centric
Company
Individual
skills
Having a Product Focus
When we are building the company to sell, it is better to focus on a few products that are scalable. A
single product focus is best – especially a product that is complementary to a large market leader, or
Build to Sell
Build to Grow
6. 6 | P a g e
perhaps a standardized product with minimum customization. Most start-ups get desperate quickly
and start taking all business that comes their way. This culture enshrouds them over the years. But
somewhere down the line, there is need to pick up only those that make sense. To scale, small
companies must stop responding to all and sundry RFPs and not spread themselves too thin. Focus
on high margin business. Expand the customer base for this product and grow revenues here. The
product should also be scalable, where one is able to foresees future requirements and build in the
ability to modify the product with minimal effort. Amidst all the noise and a plethora of products in
the market, be careful to avoid commoditisation and make sure the product is valuable to
customers, and that they keep coming back for repeat business. The routines to build the product or
service also need to be standardised so that owner is not sucked into it. Only when the owner is free
from this routine and it becomes executable by the second level of staff, will scaling really happen.
Companies built to sell would standardize their offerings so as to restrict projects with complex work
contracts and customization. Customization and clauses in work contracts bind the company to
various activities which might not be acceptable or in good taste with the buyer. The buyer would
look at contracts which are hassle free, less binding and easy to execute.
Instead of developing generic products and services where the market is large but the competition
too is neck deep, companies intending to sell, explore whitespaces where the market is yet to assess
the potential and the company has a first mover advantage. These companies often try to capitalise
on the rarity or exclusivity of the product / service. They create a position by understanding the
market. Buyers/investors find these companies attractive as they have a foothold in the market and
growth is evident due to less competition and established product/service. Hence try and dominate
a niche product/market.
Becoming Market Driven
Many small companies grow their business by word of mouth. Such companies mostly have order
takers in sales. Very few in the initial stages of maturity have full fledged sales and marketing
functions. Their product or service could be well received in the market. But outside that small pond,
the brand largely remains unknown. But to sell, the company seeds to demonstrate its brand value,
the importance of a full fledged marketing and sales function that will enable the firm to sense the
market, build new products and grow revenues. This is where investments would yield big returns in
terms of premium valuation. It will project the firm in a very different light as one that has
consciously developed business, and will surely be a very attractive acquisition candidate. A self
perpetuating business with a visible funnel of prospects, predictable revenue streams, and de-risked
sufficiently with more than a few customers will create that much needed comfort factor for a buyer
that it is indeed a safe investment even if the founder exits.
In order to grow, companies need to build a market driven culture. Companies need to be able to
sense trends earlier than competitors, have a strategic planning process, and be able to analyse
market information. Systems to gather such market information, analyze it, disseminate the
information internally within the organization, and internally act on it are critical if companies need
to scale. In small companies, market information that is captured by sales people, usually resides in
their minds, and is rarely captured and codified. The sales person usually downloads this information
to the owner, and the owner by virtue of his deep background knowledge, immediately gets the
idea. But sometimes, in the flood of information, the loop with the sales person does not get closed,
7. 7 | P a g e
and there is lack of clarity for the sales team on what next they need to do. How do they prioritize
and move forward? Are there things they should focus and others that need to be dropped? This
loop gets closed and becomes effective only with processes in place. Further, this information needs
to be shared amongst the employees. When employees – at least the ones who matter, apply this
deeper knowledge to solving marketing problems, the firm's marketing capabilities are enhanced.
Few key marketing capabilities are therefore Market research, pricing, product development and
managing distribution channels (will develop better ways to service and support channels),
developing relevant marketing content, executing a marketing plan, frugal branding will not only
lend a much higher value to the company, but also bring in the much needed short term revenues to
demonstrate growth.
Building and effective sales organization is crucial. Experienced salespeople have to be brought in,
who lend a sense of professionalism, lend credibility and make the organization look larger than it
really is. It helps in better reach and branding too. Sales metrics, processes and reviews have to be
designed and implemented to function effectively. Regularly tracking prospects, pipeline and
conversions, shows buyers that there is visibility into sales, and it can be forecasted. They get a grasp
of the conversion rate. Also, it is good to invest in more than one sales person. Have a team. If a
buyer walks in tomorrow, the first thing they ask is the customer list and details of the sales team.
Apart from demonstrating this to them, we need to show a level of maturity which provides the
buyer with the much needed comfort factor.
Increasing predictability of revenue streams
How predictable and repeatable are revenues from products and services. Is it like a consumable,
where consumers keep buying again and again? Or is there a platform that they are locked into like
an ink-jet printer, and then the consumables business becomes even more sticky? Or, are they
locked into contracts like mobile phones; Or, is it a subscription business like a magazine, or perhaps
a more sticky subscription model like a Bloomberg terminal? Acquirers will look whether revenue
models such as these exist and this creates value and a sense of predictability and manageability for
the buyer. Try to explore AMC type of revenues that are more predictable.
Positive cash flow cycles
Unlike magazines that charge an upfront subscription fee for the entire year, many businesses may
not be able to collect all of the fees upfront. But try to get at least some part of the revenue upfront.
It improves cash flow, reduces working capital requirement and makes the business attractive. A
potential acquirer will not have to set aside a large part of the capital for Working Capital
requirements, and hence will be more willing to value the business much higher. We must be able to
demonstrate such positive cash flows at least for a couple of years before selling the company. In
fact, in the first year, we may be better off taking a hit in the P&L accounts just to improve the cash
flow situation. Remove all NVA activities that are a drain on the finances. Although buyers look into
at least 3 years of the statements, a serious effort in this direction needs to be enforced.
Building a leadership level
Many small businesses are identified by their owners. They are the rainmakers for the business. They
really need to wean the company off themselves and build in a strong second level of leadership. In
SME or family owned firms, there are usually no layers between. There is need to attract talent. But
8. 8 | P a g e
to attract talent the company has to create the right business culture. The question is how can this
be done?
Identify and put in place a pool of leaders. These leaders need to be in a position to identify goals,
customers, markets and basically address “What is to be done”. They also need to work on the
execution plans which talks about “How to do it”. For success, decisions and ideas have to come
from the lowest level of the organization – it has to be like a sports team, where all know the goal
and can effectively change tactics at any time. As the company matures, the leadership style has to
change. Initially it is like a Tennis player who is individually driven. Then it should become a basket
ball team, where a handful know how to play ball and the coach keeps shouting from the sidelines.
In the advanced stage, it has to be a soccer team – complete with manager, extras, club etc., but
completely focused on the goal and with an ability to change tactics according to the environment.
Long term incentives plans
Incentives are a must to get the leadership team committed to the company in the long term. Avoid
giving out equity, since this complicates matters during the sale process, and can dilute the owner’s
holdings. Instead have an incentive plan, where significant amounts are set aside for key employees
every year – which they can withdraw only in the long term. In the event of a sale, a large bonus can
be given to them, to ensure that they are committed to the sale process. Employees are aware of
the intention to sell even before it is communicated to them. It is naive to assume that it can be kept
under wraps. Usually, the sale can turn out to be beneficial for the employees in terms of career
growth, options to work for a larger company, etc.
Business plan and strategy
Have a clear business plan and strategy for at least 2 to 3 years. This is to show the road map, the
growth plan, investments required and vision for the company. This is required regardless of the fact
that an owner would want to sell the company. It helps clarify purpose and reinforces the vision of
the buyer or investor. Clarity on the type of capabilities that need to be built to reach a certain goal
is important. Detailed plans in other functional areas will also help to show that much of what is
being done has been thought through carefully.
High Leverage of Network
Having eminent professionals on board (management) and being associated with market renowned
institutions provides that extra mileage or push the company requires to position itself in the market
or related industry. Companies often get noticed because of their management or investors. These
professionals/institutions play a major role in the market perceptions about the company and its
credibility. Leveraging the standing of these entities or persons, the company can signal the market
about its arrival, potential and capabilities.
Avoid heavy investments in tangible assets
Some companies make the mistake of starting to acquire assets like land, office space, plant and
equipment. They want to look larger than they are to investors. But companies rarely get paid a
premium on market prices for such assets, unless the assets are actually infrastructure for effective
operations. Hence it is wise to not invest on long term assets or capital with long term obligations.
Focus on short term/immediate investments which would yield quick returns and liquidation.
9. 9 | P a g e
Duplication of manufacturing facilities and vertical integration would make the organization heavy
on assets /capital, making it difficult to be sold and easily liquidated.
Managing the change
Business Transformation is all about holistic change companies need to undergo to basically grow
faster or become more relevant to the market. This change can be implemented incrementally with
small measured steps. There surely would be resistance on the path. The first question when
companies attempt transformation is which process to touch. In most businesses, the easiest
function that is amenable change and one without too much dependencies and investments is
“sales”. Moreover, any minor changes in sales function has a direct impact on the “outcome”, be it
new customer acquisition, or more orders from existing customers. Any win, however small, can
uplift the mood for change and thaw the resistance to change.
Employees should not feel threatened by change; instead they must be allowed to participate in this
change – especially the critical members of the team who are key influencers. It must vibe with a
sense of growth and pride in the organization. Such changes convince fence-sitters that change is
good and doable. A highly visible short term win will also enable the top leadership of the firm to
start change on a winning note.
Once this clarity of purpose is communicated through initial changes, it becomes necessary to get
the second level involved and broaden the base. Create groups to improve their respective
functions, ask them to identify and drive changes where they feel empowered. Next involve people
in information, communication and advocacy changes. Ask the employees to suggest changes to
website, the sales and marketing collaterals that work best and ask them to drive these
improvements. Their buy-in is absolutely essential to drive the second-order change. Now that we
have a broad based team that believes in the new vision, we need to build a sense of urgency so that
the change that has been demonstrated can be capitalized upon. Once this happens, creative inputs
on products, offering and markets start to pour in. It also gives everyone a chance to delve deeper
into the core offering and strengthen it. Once we have the top and second level of leadership
involved in this exercise, they believe in the new vision and positioning, especially since it is their
aspiration that has been translated into the firm’s vision and strategy. Training and reviewing team
members to drive this, building their capabilities and motivating them becomes essential. Working
as teams and leveraging off each other needs to become a habit, a new way of working. Once
success can be shown in a couple of inter-functional initiatives, a broad base of employees becomes
adept at adopting such structures across the entire organization. Making change happen in other
functions and departments new becomes a lot easier. Hence managing transformation in stages with
the right vision, by building the right capabilities, help build the foundation for a large business
transformation. To bring about change for building and organization to sell, the implementation
needs to be faster, and hence a top down approach is suitable.
Conclusion
When small companies face growth challenges, succession challenges or an increasingly complex
environment, they sense the need to exit the business. Rarely are companies ready to sell. A hasty