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Knowing Your Work's Worth

Business valuation

(Featured in the The Financial Post November 19, 2007)

Kilbride Partners Managing Director Andrew Pigott has been featured in recent articles on the subject of ownership succession and business valuation by Alexandra Lopez-Pacheco in the Financial Post. In the most recent article the journalist wrote that while most business owners have an idea what their business is worth, these ideas are often based more on gut feel than on fact. Andrew provided his insights into the long term planning benefits business owners can realize by going through the business valuation process.

The full text of these articles may be accessed through the following links:

Knowing your work's worth

Nothing left to chance

The Essence of Leadership and Making Light Work of Family

Judy McLeod, Managing Director

Leadership Thoughts

To me, the essence of leadership is character and authenticity. Character is all about trust and integrity. My parents drummed this into me as a young adult by continually reminding me that all we really have in this life is our reputation. Money and other material things can always be replaced, but your reputation isn’t easy to fix. Authenticity is about being yourself ‑ the real deal. Here are some other things I always try to keep in mind: Love what you do and be passionate about it. It is essential to have a sense of mission that comes from the heart and gives you drive and enthusiasm. You’ll find that it’s contagious.

• Be a great communicator. Practise clarity of thinking and tap into people’s sense of meaning.
  
• Delegate, delegate, delegate. Doing the things you love and are good at will give you energy. Delegate the rest.
  
• Keep your ego in check. Businesses can’t be built or managed by one person, it’s a team effort.
  
• You are a product of the books you read and the people you associate with, so hang out with successful people and read great books! Some of my favourites are Principle-Centered Leadership by Stephen Covey, Good to Great by Jim Collins, Execution by Larry Bossidy and The World is Flat (all about globalization) by Thomas Friedman.
  
• Hire and develop the “A” team. Nothing great ever happens without a motivated team of people. Inspire people to greatness.
  
• Focus on doing the right thing. Something I was told years ago is that the key difference between manager and leaders is that managers focus on doing things right and leaders focus on doing the right things.
  
• Tie everything together with reinforcing management systems. Have the right measurement systems. What gets measured gets managed.

Being a great leader also means finding balance. Too often I talk to people who are too busy making a living to have a life. My favourite motivational quote is by Mary Anne Roadacher-Hershey: “Live with intention. Walk to the edge. Listen hard. Practise wellness. Play with abandon. Laugh. Choose with no regret. Continue to learn. Appreciate your friends. Do what you love. Live as if this is all there is.”

I have this pasted into my notebook, on my mirror and I read it every night before I go to sleep. To me this is all about happiness and balance.

One of the highlights of my career came after speaking to a group of high-achieving sales people at a conference. I shared my story about how it took me the first 20 years of my working life to start to understand that balance is important – this was after focusing on my career at the expense of my family as well as leaving a trail of neglected relationships with friends.  I made up my mind that I needed to create a balanced vision and mission for myself that contemplated financial, family and friends, health and spiritual needs.

At the conclusion of my speech I realized that this really resonated with a number of people in the audience – the feedback was emotional and heartfelt. Several weeks later one of these top achievers made an appointment to see me. He wanted to thank me for helping him save his marriage – he said that my story had a profound impact on him and he left the conference determined to get his life in balance. I had a lovely note from his wife sometime later. The psychological rewards of leadership don’t get any better than this!

Tips for Working with Family Members

1.  Remember, it’s a business    

What happens around the dinner table on Sunday evening is one thing.  What happens in the store, the factory or the office is another.  If a family member is unwilling to accept the professionalism expected in a business, that person shouldn’t go on the payroll. 

2.  Non-family employees in a family-owned business have a right to know their prospects. 

Don’t lie to employees about their promotional opportunities if those opportunities are reserved for family members.  Giving false hope is not only unethical but is likely to eventually hurt your bottom line.  The disgruntled employee may leave you during your busiest season or may sabotage your efforts without your ever knowing it.

3.  When you start a business with family members, handshakes and hugs are good but written contracts are better.

Any family member may start a business inspired by love and the best intentions.  Over time, however, one person may wish to leave the business or take it in a direction the other doesn’t support.  If irreconcilable conflict motivates one to leave, who buys out whom, under what conditions, and for what price?  Family loyalty won’t help as much as a contract will at this stage.

4.  Don’t allow favouritism towards family to kill employee morale.

Non-family members realize that family members will receive certain considerations.  However, if special treatment is blatant, affecting sound business decisions or causing employees to feel unappreciated, then morale will suffer. One example would be to move a less qualified relative into a job that a loyal employee has been preparing for years.

5.  If you can, don’t place family members in direct reporting relationships with one another.

Large companies often have formal policies precluding employees from reporting directly to relatives.  The reason is the difficulty in making objective decisions about relatives. Small companies may not have this luxury. 

6.  Don’t allow executives’ relatives who aren’t on the payroll to seek special treatment from employees.

It’s a morale buster when family members ask employees to fulfill special requests that are above and beyond that employee’s assigned duties. 

7.  Keep relatives who aren’t employees out of the office.

Even if the relative doesn’t attempt to take advantage, employees are likely to feel under scrutiny or pressure when they are around. 

 For further information please contact:

Managing Director

Kilbride Partners

t: 905-632-6460 x261

c: 416-988-4955

F: 905-632-4502

www.kilbridepartners.com