Designing An Exit Strategy While Being Considerate To Loyal Employees
- Date: 2008-07-26 - Word Count: 429
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Your business has assets in which you have spent money. Business should be growing in value so that when time comes, you will be able to return additional assets and protect wealth for your family. Most of the company holders plan for their business growth but hardly plan for an exit strategy. Exit strategy is most commonly over looked by planning deliberation. At the same time exit strategy plays major role in determining the strategic direction for the company long before you exit. By not setting up an exit strategy before and limits the options for business owners and successors in future.
Your business goes through many evolutions and transaction so that you should think of your exit strategy as another, important business transition. Any major change in future that also includes opportunities for mergers and acquisitions with another business or a new product line, needs long term strategic initiative. Unless you plan these opportunities, exits or transitions then they will be happen in unexpected ways. Consider an exit strategy less as termination, and more as another logical transition for both you and your company. If it is planned properly and managed transition it will have benefits for your business, its owners and their heirs.
If you have built your business up over many years you will not have done it alone. You will have a team of reliable employees who have accompanied you on the journey. If you do not plan for your business progress and control your business exit then there's every probability of you losing their support during the crucial stages of deal making. Take an Example of Mo Siegel. Mo Siegel has built up the business of Celestial Seasonings over many years based on the passion. He instilled a reliable team of company managers and other employees. It later grew to be the largest supplier of herbal teas in the US. In 1984 he sold Celestial to Kraft for a very large amount. The culture of Kraft was very different and they changed the culture of Celestial to match it. It was a bad try, as the culture rift was very wide. Many of Siegel's hand groomed managers left in anger and hatred. After four years Siegel bought the business again, restored the old culture and recruited back many of those lost managers. In 2000 he found a company that shared Celestial Seasonings idea. He merged his business with Hain Pure Foods to form Hain Celestial Group. Siegel stayed for three more years to manage the transition and investment banking and then retired in peace.
Your business goes through many evolutions and transaction so that you should think of your exit strategy as another, important business transition. Any major change in future that also includes opportunities for mergers and acquisitions with another business or a new product line, needs long term strategic initiative. Unless you plan these opportunities, exits or transitions then they will be happen in unexpected ways. Consider an exit strategy less as termination, and more as another logical transition for both you and your company. If it is planned properly and managed transition it will have benefits for your business, its owners and their heirs.
If you have built your business up over many years you will not have done it alone. You will have a team of reliable employees who have accompanied you on the journey. If you do not plan for your business progress and control your business exit then there's every probability of you losing their support during the crucial stages of deal making. Take an Example of Mo Siegel. Mo Siegel has built up the business of Celestial Seasonings over many years based on the passion. He instilled a reliable team of company managers and other employees. It later grew to be the largest supplier of herbal teas in the US. In 1984 he sold Celestial to Kraft for a very large amount. The culture of Kraft was very different and they changed the culture of Celestial to match it. It was a bad try, as the culture rift was very wide. Many of Siegel's hand groomed managers left in anger and hatred. After four years Siegel bought the business again, restored the old culture and recruited back many of those lost managers. In 2000 he found a company that shared Celestial Seasonings idea. He merged his business with Hain Pure Foods to form Hain Celestial Group. Siegel stayed for three more years to manage the transition and investment banking and then retired in peace.
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