How to Be Irrelevant to Your Company and Make It More Valuable

Yes that’s what I said, irrelevant, unnecessary and not required every day. ​You should be working very hard to build your business into something great and reduce the need for your presence in the process. This is an important part of your succession planning.

The Strategy

The strategy is simple, you need to follow these guidelines:

1. Have a big vision and make it worthy of your time and effort. And more importantly your staff's time and effort.

2. Bring great people with varied skill sets and experiences onboard. Make sure they speak their mind.

3. Let them do what they do best and are most passionate about. We all have a superpower and at our core we know what it is. This is usually accompanied by a deep desire to unleash it to its fullest potential.  

4. Create a desirable inclusive atmosphere that great people want to be a part of.

If you succeed, they will thrive and likely take the company much further than you ever could on your own.  So what should irrelevant mean to you in the context of selling your company? Right now and for the foreseeable future you will maintain the vision and lead the charge. As you are getting ready to transition, slowly replace your superpowers with others who demonstrate the same abilities and let them take over.  

The same applies to any of your key staff who will be leaving around the time of selling or within a few years. Business Buyers will interview your employees and they will find out who is staying and who is going. Start training their replacements as well.

At some point you will become redundant, irrelevant and unnecessary to managing and growing the business. You will then have succeeded.  EBITDA margin is good, it’s time for a generational succession plan.

The business operating without you is a key factor when business Buyers are considering purchasing your company. It means they can step in and immediately take over.

It's not easy and requires some real grit on your part. While many day-to-day functional activities are taken care of by staff there are still top level decisions that always seem to fall into your lap. No this is not by fluke it is by design, your design. The desire to be relevant and important to the process.

The Reason

There is a reason that some of you have kept your business running at a particular sales level for years. It's not always because opportunities have dried up. Nor is it the new developments within your industry. It's because there is a comfort in working in a particular sized business. You found your comfort zone and staying there is well, more comfortable. Typically an Owner will keep a successful business just under $3 million around $2.6 million in annual sales. Or in many cases under $1 million or under $2 million. You've created what is often referred to as a lifestyle business. i.e. it fits and finances your lifestyle

I know it sounds counter intuitive since you spent the last few decades making most of the key decisions, creating and massaging the vision, leading the sales and generally driving the business to its current success.

It won't be easy to give up the responsibilities and let go. But the Owner who has done this typically finds that among the many factors used by business Buyers to make a purchase decision, this one is key.

Put yourself in the business Buyers seat. You do the transaction and suddenly you get hit by a bus. Or there is a falling out and you refuse to continue the transition relationship. You don't agree with a change they're making and your instinct is to fight it or worse sabotage the change. If the business Buyer is dependent upon one or two people to determine the fate of the business post sale, they're highly unlikely to move forward with a purchase.

You can say it won't happen all you want, but when one is dealing with real money and time invested in the success of a venture they want all the right cards in their hand.

So become irrelevant personally, to the point where you become incredibly desirable as a company. 

Exercise – Task 

1.     Step 1 is to be clear on your superpowers. 

2.     Step 2 is to determine who the best replacement might be. Look inside your business and outside.

3.     Step 3 is to identify the current staff with other superpowers the company needs to thrive. And their replacements. Because you never know who will leave or when.

My superpowers and replacements are:

1. Power                                                                     Replacement

2. Power                                                                     Replacement

3. Power                                                                     Replacement

4. Power                                                                     Replacement

Other currently existing superpowers within the company and their replacements are:

1. Power                                                                     Replacement

2. Power                                                                     Replacement

3. Power                                                                     Replacement

4. Power                                                                     Replacement

Conclusion

The concept of becoming irrelevant to your own company may seem counterintuitive, but it is crucial for building long-term success and increasing the company's value. By following the outlined strategy, which includes having a clear vision, bringing in talented individuals, empowering them to excel in their passions, and fostering an inclusive atmosphere, you can create a thriving business that can operate without your constant presence. This succession planning approach ensures that the company continues to grow and attract potential buyers who seek stability and a smooth transition. Embracing irrelevance allows you to focus on developing a generational succession plan, making your company highly desirable and poised for future success. By identifying your own superpowers and their replacements, as well as those within your team, you pave the way for a seamless transition and sustained growth.

Are you asking yourself how long does it take to sell a business? Or should I sell my business? What are the steps to selling a business and how much do I sell my business for? What is EBITDA and EBITDA margin? Do I need a business value consulting professional to calculate value of a company? If you’re looking for tips for selling a business and increasing your customer base, from someone who specializes in family business coaching and consulting, you’ve come to the right blog.

As a trusted business advisor and sale advisor providing sell side advisory services I appreciate the opportunity to share my years of experience working with Owners just like you who have demonstrated their entrepreneurial spirit for years. In fact you may want to consider our online program ‘Sell Your Business 4 More’. Click on the Eric Gilboord Coach cap above.