Monday, April 15, 2013

Culture is King: Don’t Sell Until You Ask

Has someone offered to buy you out? Before you start talking numbers and giving away your firm’s financial information, talk at length with the potential buyer to understand how he or she operates. If you do sell, the result will be something like a merger, at least for a few years. You’ll likely end up staying around working for the new owner, so you need to make sure there is a cultural fit.

Remember, too, that your employees have been doing things a certain way for a long time; you want to make sure they’ll be happy in a possibly new culture with new rules. Otherwise, the deal could collapse of its own weight.

Before dealing with finances, deal with culture. PSMJ suggests you ask the potential buyer these questions:
• What is your definition of growth?
• What effect does your ownership plan have on growth?
• Why is growth important to you?
• What talent do you need that is not present in the firm?
• How do you nurture and sustain future leaders?
• How do employees gain ownership in your firm? How long is the typical process?
• What criteria do you have for owners? For leaders?
• What is your firm’s mission statement?
• Why are you successful?
• How do you manage branch offices? Are they individual profit centers?
• How do you market projects?
• What is your success rate on RFP type submittals?
• What image does your firm currently project, and how will that change by merging with us?
• Describe your “bull’s eye” or ideal project.
• What type projects do you pursue, in order or priority?
• What constitutes good service to your clients? Exceptional service? How do your clients perceive your firm?
• How will you enhance our value? How will we enhance your value?
• How do you recruit employees? How do you determine salaries and bonuses?
• How would you rank these five character traits when hiring an employee: loyalty, experience, integrity, intelligence, ability?

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