Marc Lacoursière – Many methods of business valuation are based on things such as multiples of earnings, market opportunity, or competitive maneuvers; but when we add people into the equation, another variable is introduced: soft skills and succession planning can collide and have significant impact on value and the odds of success.
Businesses already face so many challenges:
• Competitive forces
• Disintermediation – where a new technology or business model removes your existing offering. Think Kodak film cameras
• Attracting and retaining talent
• Cost and supply pressure
And the list goes on. When the topic of succession planning gets included, it can’t happen without involving people – the most complex variable of all.
Soft Skills and Succession Planning
In plain language, the people factor is not black or white. Based on the myriad data about people engagement, there are disconnects from our collective misapplication of soft skills. How might these issues trickle down to succession? Certainly, the lower the level of organizational alignment and engagement, the greater likelihood of underperformance, decreasing company value. Whether the succession is internal (ownership transfers to people inside the company), or external (new, outside ownership), paying attention to soft skills means paying attention to people, the factor having the highest impact on success or failure.
Get in Front of It
Human interactions are akin to driving a big ship through a narrow channel. A small difference in intent and direction can be catastrophic. This is one reason why feedback tools like surveys and coaching are so valuable. They help set up the business for future change because people get clarity on intent, needs, and feelings for all parties.
Maybe you are the one person in a billion who has never had an issue in a workplace due to miscommunication, an unpopular policy, a difficult employee, or poor working conditions. If that’s you, we’ll assume you have just been hired into your first job and are unblemished. Congratulations! For the rest of us, we can learn from our past decisions, and where appropriate, make course corrections.
You can undertake a free Business Size Up survey to evaluate areas of strength and opportunity in your business by clicking here.