It’s not uncommon to hear the phrase “don’t take it personally” in terms of business decisions. But when you’re a business owner, it’s hard, if not impossible, not to make business decisions personally. After all, chances are you, your family, and others you care about rely on your business to maintain their way of life or their sense of family heritage.
This can be a heavy burden for owners. And often it takes the right kind of planning, rather than planning for itself, to relieve homeowners of this burden. Consider the story of a business owner who took business planning personally and how it affected her future.
After 5 years, Amber Auerbach decides to start alone. Her boss and owner of the medical supply distribution company she worked for, Bobby Glass, had refused her demands for more responsibility in exchange for ownership opportunities, despite his key role in growing the business.
“It’s a family business, and you’re not family,” he told her dryly.
When Amber handed in her resignation, Bobby wished her well, saying, “We’ll be fine without you.”
Amber’s first inclination was to drive as many clients away from her former employer as possible. But she met Mabel, a longtime friend who was also a business consultant, who helped her refocus on what was most important.
“You have an idea, but it’s a little too vague. What you need is a plan that goes beyond spitting out your old boss,” Mabel said. “So what do you really want to do?”
Make the business plan personal
“Property has always been my focus,” Amber told Mabel. “What I really want is the chance to retire before I turn 50 and leave a legacy where my employees will think highly of me and the opportunities I have provided.”
“It’s a good start,” Mabel said. Let’s first look at what you need to achieve this retirement goal.
Over the next 5 years, Mabel and her team of advisors began laying the groundwork to achieve Amber’s retirement goal. They helped her build her new business in a field related to the work she had done for Bobby’s company, hire a high-level management team to implement Amber’s vision, and implement place strong incentive plans.
Around this time, Amber got married and had two children. Her husband entered the business as a staff accountant. Amber told Mabel that she refused to let the fact that it was now a family business affect her business family.
So Mabel and the team of advisors created written performance standards to reduce the likelihood of her business falling prey to nepotism as Amber had experienced in Bobby’s business. Moreover, they helped her to identify the differences between her key employees and her important employees. This created an appropriate incentive culture, which led to a surge in morale.
After 15 years, Amber’s company had bought out the remains of Bobby’s family business. No one could replace Amber there, and after Bobby died and his two children took over the reins, things got complicated for Bobby’s family. Her kids gifted Amber their property so they could cash in and do what they really wanted to do.
After defeating her old enemy, Amber asked Mabel what else she could do. She was about to retire when she wanted to, her employees loved her, and she had managed to keep her family business running and her business family happy.
“You set yourself up for success, but we have to think about a future without you,” Mabel told him. Over the next two years, Mabel and the advisory team finalized Amber’s business continuity instructions, as well as a plan for her to sell to her management team.
Three years from his target retirement date, tragedy struck. Amber was diagnosed with an aggressive illness which, while manageable, would require her to be away from the business for months at a stretch.
Her business continuity instructions gave her management team and family advice on what to do while she was undergoing treatment. They also allowed him to rely on his family and non-family members of his team to continue in a manner consistent with his direction of the business.
The final sale
It took two years before Amber could return to full-time work. Despite his absence, his business continued to grow, thanks to his diligent planning and strong management team.
With only a year left until her scheduled retirement date, Amber was feeling anxious. She wanted to make sure her children had the money and the skills they needed to lead fulfilling and productive lives, doing whatever they wanted to do.
Thanks to her planning foresight and her dedication to her employees, Amber had a solution.
Immediately after the sale was completed, Amber’s management team announced that the company had founded a charity to raise funds for people with Amber’s disease.
Then Mabel and the team of advisers helped Amber use some of the proceeds from her sale to give her children a nest egg in case they suffered from the same illness.
Amber and her husband retired in style, and eventually her children and some of her grandchildren continued to work for the company she founded.
Amber has successfully personalized her business planning, which has made her personal and professional life all the more fulfilling.
Where do your professional and personal lives intersect? Are you doing the necessary planning to make these connections more meaningful?
We strive to help business owners identify and prioritize their goals as they relate to their business, their employees and their families. If you’re ready to talk about your goals for the future and find out how you might achieve those goals, we’d be happy to sit down and chat with you. Do not hesitate to contact us at your convenience.
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Contributed by Chip Mayo and Dallas Romanowski
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As a member of the Business Enterprise Institute (BEI), Cornerstone Business Advisors is an authorized distributor of BEI’s exit planning content and tools.
The Cornerstone team includes former C-level executives, successful entrepreneurs and advisors who offer unparalleled experience in delivering advanced, personalized and results-driven solutions for business leaders. As a member of the Business Enterprise Institute (BEI), Cornerstone is an authorized distributor of BEI content and exit planning tools. We developed the Performance Culture System™ to help clients implement best practices and drive high performance across their organization. For more information, visit www.launchgrowexit.comcall (910) 681-1420 or email [email protected]