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The Vann Group Journal is a monthly e-Zine for business leaders concerned about transitional business topics.
A business in transition is one that knows that where it is today is not where it wants to be tomorrow. Transitional businesses may be growing rapidly, at a plateau, in crisis, or contemplating an exit.
This month we are announcing our new website, and examining two topics that are particularly timely … |
About the Vann Group
The Vann Group is a professional advisory firm that assists companies in transition to unlock their value. We provide practical business counsel to transitional companies through a customized approach that is founded upon our family’s passion for business and a 150+ year entrepreneurial track record. |
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New Website Launched!
The Vann Group has just launched a new website complete with complementary knowledge resources and a link to Mike Vann’s Blog. We hope you’ll visit our new site at www.vann-group.com and sign up for RSS feeds of Mike Vann’s Blog. Visit often, because we will add new white papers about once a month.
‘Tis the Season – A Budget Without a Plan?
Many companies are kicking off their 08 budgeting process right about now. The financial people are sharpening their pencils (and getting their erasers ready) and the department heads are putting together their wish lists. Soon, the first draft, an inch thick document full of numbers, will go thunk on the conference table; and so begins the classic push/pull negotiations of how much to spend, and on what, in 2008.
Ah – but is this a budgeting process or a planning process? Shouldn’t the plan come first, so that the budget is crafted to enable strategic priorities to be achieved?
If your budget process is moving forward outside of a sound strategic framework, you are doing it backwards. Don’t be too hard on yourself, because you are in the majority. However, it is time to stop, take a step back and ask these questions:
- Does your business have a strategic plan in place that will drive new growth opportunities and distance you from your competition?
- Is your plan aligned with your company’s own unique core beliefs, values and strengths?
- Are your employees engaged in and energized by your plan?
A sound strategic plan – especially for businesses in transition – is the first step in getting closer to where you want your business to go. Countless books have been written about strategic planning and about as many consultants are available to help you craft a plan. To cut through the clutter, at the Vann Group, we recommend that businesses customize the following three phases to their own needs:
- Phase One involves a cross section of management and employees and is focused on internal assessment. The group should critically assess the organization in-depth prior to the development of a strategy. It is important that the organization understands its core beliefs and values and uses them to building mission, vision and strategy statements. Finally, in phase one, the company should utilize committees and task forces to identify and implement activities that the Company must improve before it focuses on growth.
- In Phase Two, the company develops a clear picture of what it wants to be and what it wants to achieve. This phase also involves identifying the strategic themes needed to achieve the goal and developing the metrics (Balanced Scorecard) needed to measure performance and progress.
- Phase Three is all about action. It identifies the specific action steps, owners, and timelines needed to achieve the goal.
Once this strategic framework is in place, the budget process is easier, because the priorities are obvious to everyone involved. So, while some might miss the annual tug of war over the budget, there is no question that the organization will reap significant benefits from having a clear and sound path to follow.
For information about the Vann Group’s transitional planning services, click here |
Is 2008 the Year to Sell?
With the first wave of Baby Boomers turning 60, we know that many business owners are beginning to think about selling. In fact, of the 1,143 family-owned businesses surveyed by the Mass Mutual Financial Group and the Raymond Family Business Institute, thirty nine percent said they planned to change leadership within five years*.
With the final quarter of the year upon us and plans and budgets being laid for 2008, this is a good time to get your arms around the process. To help you get started, here is a snapshot of the steps involved:
- Make the emotional decision – are you prepared for life without your business?
- Determine the value of your business.
- Determine if the return is sufficient to meet your financial goals.
- Prepare the business for sale.
- Hire a professional intermediary to manage the transaction professionally and confidentially.
- Market the business.
- Meet with buyers.
- Negotiate with realistic expectations.
- Close the deal ensuring to maximize after tax dollars and minimize future risk.
*Mark A. Stein, Selling a Family Enterprise: Tough to Decide and to Do, The New York Times, Feb. 19, 2004.
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