Mark Allen Roberts

In the quest for personal development and achievement, understanding the distinctions between resolution, goals, and rhythms is crucial. These three elements form the backbone of a well-rounded approach to success, each uniquely guiding individuals toward their desired outcomes.
Clients and friends often use these three terms interchangeably, but they differ greatly.

Resolution:

A resolution is a broad, overarching commitment that often serves as the foundation for one’s aspirations. It encapsulates the essence of what a person aims to achieve, typically long-term. Resolutions are like guiding principles, shaping the overall direction of one’s journey. For instance, a resolution could involve a commitment to a healthier lifestyle or a dedication to continuous learning. To have an engaged and accountable workforce delivering exceptional customer service.
One of my resolutions is to be more conscious about what I eat. I am moving to more of a plant-based diet and plan to consume 1700-2500 calories daily.
I also plan to increase my movement each day with longer dog walks with my ruck backpack and at least four days a week at the gym.

Goals:

Goals are individuals’ measurable and specific targets to fulfill their resolutions. Unlike more abstract resolutions, goals provide a clear roadmap with identifiable milestones. Some people refer to the right kind of goals as SMART goals. Short-, medium-, or long-term objectives contribute to a resolution. For example, if the resolution is to lead a healthier lifestyle, specific goals could include losing a certain amount of weight or exercising several times per week.
I will eliminate diet soda and refined sugars and replace them with water and fruits.
My goal is to have a healthier body measured by my weight, blood pressure, body mass index, and cholesterol numbers. My BHAG goal for my body weight is to be 60 lbs lighter by next year. I will measure my weight daily and other measurements as my doctor prescribes.

Rhythms:

Rhythms are the routines and habits that individuals establish to support the pursuit of their resolutions and goals. These regular, repeated actions create a cadence that helps integrate desired behaviors into daily life. Rhythms can be considered the consistent practices that lead to progress over time.
Using the example of a healthier lifestyle, establishing a daily exercise routine or a meal planning habit can be considered essential rhythms.
I am measuring my steps each day, targeting 10,000 steps.
I am logging each meal and plan 90% of the food I consume will be plant-based ( still eating fish) for the next six months, then 100% every month thereafter.
My workouts will include aerobic and strength training.

Connecting the Dots:

The synergy between resolutions, goals, and rhythms is what propels individuals forward on their journeys. Resolutions provide the overarching vision, goals break down that vision into manageable steps, and rhythms ensure consistent effort is applied over time. Success is about achieving specific goals and cultivating positive habits that align with one’s overarching resolutions.

What are your company’s Resolutions, Goals, and Rhythms for this year?

I just helped one of my Scaling Up clients, and they are focused on the following objectives for 2024. There is a lot more information for each section, but for the goal of sharing an example, the below will help.

Resolution: We will take a customer-centric approach to driving explosive growth in 2024. We will implement the scaling-up system focused on four key decisions: People, Strategy, Execution, and Cash. The leaders will commit to working on the business in the annual two-day planning session and the quarterly full-day meetings and establish daily huddles for each team member. We will diversify our revenue by identifying and entering at least one new product and service market. We will implement continuous learning for all associates and managers to improve employee engagement. We will communicate our purpose, vision, and culture and reward those demonstrating our core values.

Goals: We will achieve $38 million in revenue with gross profits of 37%. We will launch two new products and achieve the new product launch ROI targets. Our goal for revenue from a new market is $1.2 million for the market our research identified. We will improve the collection of invoices past due by 5 days. We will execute a price increase for the profit-leaking accounts identified in Q1 and expect a 2% to 3% lift in gross profits from these accounts by Q3.

Rhythms: We have identified our KPIs, and each department has daily huddles and weekly and monthly meetings to track and discuss our performance. Our salespeople will increase the time spent meeting with clients by 15%, and we will track this in the new CRM. We established monthly, weekly, and daily sales activity objectives to support our plan, and sales will log them daily in the new CRM. We will train our salespeople how to deliver price increases in Q1 and measure the progress of customers monthly.

Practical Tips for Success:

1. Align Resolutions with Values: Ensure that resolutions resonate with your core values, creating a meaningful foundation for your journey.
2. SMART Goals: Make goals Specific, Measurable, Achievable, Relevant, and Time-bound to enhance clarity and effectiveness.
3. Build Sustainable Rhythms: Focus on developing sustainable habits adaptable to various life circumstances.
4. Regular Evaluation: Periodically assess your resolutions, adjust goals based on progress, and refine rhythms for continuous improvement.
5. Focus on Delivering Value for associates and customers
6. Address issues as they arise: should you experience challenges to our agreed resolutions, goals, and rhythms, we will have constructive discussions, and everyone will leave that discussion with a clear understanding of expectations.

In pursuing personal and professional growth, understanding the roles of resolutions, goals, and rhythms is essential. By crafting meaningful resolutions, setting SMART goals, and establishing sustainable rhythms, individuals can navigate their paths to success with intention and purpose.

Remember, it’s the combination of these elements that transforms aspirations into tangible achievements.

If your team wants help with your resolutions, goals, and rhythms this year, let’s schedule a call.

(On a personal note… I have lost 7 pounds since January 1 and noticed a significant increase in my energy and mood as I move to a plant-based diet and more exercise)

The collaboration between family-run businesses and Private Equity (PE) firms can be a powerful force, combining the legacy and values of a family enterprise with the strategic vision and financial firepower of institutional investors. However, this partnership comes with its set of advantages and challenges. Let’s explore the positives and negatives of family-run businesses working with PE firms.

The Positives:

Financial Injection for Growth

PE firms bring substantial capital, enabling family businesses to pursue ambitious growth strategies, expand market reach, and invest in innovation without solely relying on internal resources. As many entrepreneurs learn, growth takes cash.

Professionalization of Management

PE partners often introduce experienced executives and best practices in corporate governance, enhancing the overall professionalism of the management team. This can lead to improved decision-making and operational efficiency.

Strategic Guidance

PE firms provide strategic insights and industry expertise, helping family-run businesses navigate complex market dynamics. This guidance can contribute to more informed decision-making and sustainable long-term growth. PE firms are in the business of helping their portfolio companies experience explosive growth.

Diversification of Expertise

The collaboration introduces diverse perspectives, skills, and experiences to the leadership team. This diversity can lead to more comprehensive problem-solving and a better-rounded approach to challenges.

Access to Networks

PE firms often have extensive networks that family businesses can leverage for partnerships, collaborations, and market connections. This widened network can open new doors and opportunities. Our firm, for example, is a service provider to several PE firms, and we deliver sales effectiveness training, coaching, consulting, and voice of customer research. As a certified Scaling Up coach, we also help portfolio companies develop and refine their strategic plans to ensure they meet the growth objectives of the PE firm.

Succession Plan

Several of the companies we serve are family-run companies. We are finding second and third-generation children who wish to stop running the family business. Partnering with a PE firm will help those firms develop and execute a business transition to new ownership when the timing is right. This becomes a tremendous distribution of wealth event that often helps the founders retire while helping fund second and third-generation pursuits.

The Negatives

Loss of Control and Autonomy

One of the primary drawbacks is the potential loss of control for family-run businesses. PE firms typically seek a significant stake in exchange for their investment, diluting ownership and decision-making authority. From my experience, this is the biggest adjustment family-run businesses have to make. Before receiving investment, they often made decisions quickly based on their experience, gut, and intuition. Post PE investment, they now have a partner who wants to understand the business case and anticipated investment return.PE firms will support investments that increase the strategic value of the organization and make it more marketable in the future.

Short-Term Focus

PE investors often have a finite investment horizon, and their focus may be on achieving short-to-medium-term returns. This could clash with the long-term orientation often associated with family-run businesses. For example, the PE firms we work with often have a three to five-year growth objective.

Cultural Misalignment

Differences in corporate culture between family businesses and PE firms can lead to conflicts. Family enterprises might prioritize values and traditions, while PE firms focus on efficiency and financial performance, potentially causing tension. The good news is both parties want to scale the business profitably. The “how” often creates friction that must be navigated. The most significant cultural adjustment we have seen is the shift for many family-run businesses to a performance-based management culture.PE firms will help develop a strategic business plan and monitor and coach the execution of that plan. For many family-run businesses, this is often the first time some family members may be held accountable for the same performance metrics as others on the senior leadership team. Family members have always desired to grow. However, the PE firm will monitor and question plans that do not deliver the promised results.

Exit Pressure

The pressure for a timely exit and the realization of returns might force family businesses into decisions that conflict with their preferred pace of growth or succession planning.

Communication Challenges

Miscommunication or a lack of alignment on goals and expectations can arise, especially if there’s a disconnect between the family’s vision and the PE firm’s financial objectives.

New CEO and New Senior Leaders

In the dynamic business landscape, private equity investments often inject newfound vitality and resources into companies, propelling them to new heights. However, a crucial yet often challenging aspect of this transformative process is the founder’s departure from the organization’s helm. The skills to deliver the PE firm’s growth objectives may usually require new talent with experience scaling companies.
PE firms may recommend replacing other family members with more experienced ones—leaders with solid competencies in their area of focus. We prefer to upskill and train family members to build the skills required; however, if we find a family member who lacks the skills for their role and is not coachable, they must be replaced. This often creates a great deal of friction and angst.

While the collaboration between family-run businesses and PE firms holds immense potential for growth and transformation, it demands careful consideration of the trade-offs involved. By understanding the positives and negatives, companies can navigate this partnership more effectively, ensuring a harmonious blend of tradition, innovation, and financial success.

Let’s schedule a call if your company would like assistance adapting to the requirements of your PE investor.

As I work with several companies, I am finding more and more business owners who want to prepare their businesses for sale. For many entrepreneurs, the sale of their business will fund their comfortable retirement if they maximize business valuation. As I share with clients, please come to me two to three years before you wish to sell, and we can help you maximize your valuation. I wanted to share some strategic insights on preparing a business for sale at a high multiple, drawing upon my experience in the industry.

Financial Health is Paramount

Ensure meticulous financial records. Buyers often scrutinize historical performance and future growth potential. Demonstrating a consistent and upward trajectory can significantly enhance the perceived value of your business. Buyers look for increasing revenues and gross margins.

Operational Efficiency Matters

Streamlining operations boosts profitability and makes your business more attractive to potential buyers. Evaluate and optimize processes to showcase efficiency and scalability. Here, we are looking for relentless repeatability in systems and processes.

Build a Strong Management Team

A capable management team instills confidence in potential acquirers. Cultivate leadership within your organization to ensure a smooth transition and a continued upward trajectory after the sale. Here, we assess the level of trust your management team has with each other and whether they are aligned with the organization’s growth objectives.

Diversify Customer Base

Reducing dependence on a few key clients minimizes risk and enhances the perceived stability of the business. A diversified customer base is an attractive feature for prospective buyers. Not having one customer represent more than 20% of sales is important. We also help teams diversify in terms of markets. Future buyers like to see a portfolio of customers in several markets and not just tied to one.

Intellectual Property and Competitive Advantage

Identify and protect your intellectual property. A robust portfolio and a clear competitive advantage can significantly influence the perceived value of your business. We also look for what we refer to as the Rembrandt in your attic. What is your distinctive competence that could drive higher than industry multiples?

Showcase Growth Potential

Highlight avenues for future growth. Whether through new markets, product/service offerings, or strategic partnerships, a compelling growth story can attract buyers willing to pay a premium.

Mitigate Risks

Identify and mitigate potential risks. A comprehensive risk assessment and a well-thought-out risk mitigation strategy can instill buyer confidence and justify a higher valuation. Often, our customers have us do voice-of-customer research. This is a common step in the due diligence process for future investors, and we seek to understand customer satisfaction now. We identify any large accounts that are not happy and or preparing to defect and have time to improve their buying experience.

Establish a Strong Online Presence

In today’s digital age, a strong online presence is crucial. Showcase a compelling narrative about your brand and its potential through a well-maintained website and active participation in relevant online platforms. We strengthen your digital footprint, leveraging SEO, content, and other techniques to improve your online rank. Buyers spend up to 75% of the buying process researching solutions before they speak with a salesperson. The salesperson typically contributes less than 8% of the buying time today. Companies with a high rank and are found with keywords and phrases your buyers use receive higher selling prices than companies with no digital footprint.

Transparency and Open Communication

Transparency builds trust. Foster open communication with potential buyers, addressing concerns proactively. This streamlines the due diligence process and establishes a foundation of trust. This is for customers and internal associates as well.

Professional Advisory Team

Engage a team of experienced advisors, including legal, financial, and business experts, to guide you through the sale process. Their expertise can help maximize value and ensure a smooth transaction.

Successfully preparing a business for sale requires a combination of financial acumen, strategic thinking, and effective communication. We can position your business for a lucrative sale at a high multiple by incorporating these principles.

I look forward to your thoughts on these strategies and would be honored to discuss them further.

Let’s schedule a call if you plan on selling your business in two to five years and desire higher than industry multiples.

Private Equity (PE) investors are constantly looking for opportunities with high growth potential, strong management teams, and the promise of substantial returns. As one PE firm we serve puts it…there is a lot of dry powder out there wanting to be used. While the ideal business varies based on investor preferences and market trends, specific sectors have consistently attracted PE attention. This blog delves into businesses often deemed perfect for PE investors.

Technology and Software Companies

Technology remains a hotbed for PE investment. Businesses involved in software development, SaaS (Software as a Service), and innovative technology solutions are attractive due to their potential for scalability, rapid growth, and the ability to disrupt existing markets.

Securing Private Equity (PE) investment is a significant milestone for businesses, but navigating the post-investment landscape requires strategic acumen and foresight. Unfortunately, certain common mistakes can undermine the success of the partnership. This blog explores six prevalent errors that businesses often make after receiving PE investments.

Lack of Clear Communication

One of the primary missteps is a failure to maintain clear and transparent communication with PE investors. Businesses that neglect to keep their investors informed about progress, challenges, and strategic decisions risk eroding trust. Regular updates foster a collaborative environment and align everyone involved on the path forward.

Overlooking Operational Optimization

Businesses may falter by neglecting to optimize their operations post-PE investment. PE firms are often drawn to opportunities for enhanced efficiency, cost reduction, and streamlined processes. Failure to address these areas can impede the realization of the business’s full potential and hinder returns for both parties.

Ignoring Talent Management

Neglecting the evaluation and enhancement of the leadership team can be detrimental. The infusion of PE capital often comes with expectations for accelerated growth, and having the right people in key positions is crucial. Ignoring talent management can lead to a misalignment between growth targets and the team’s capabilities.

Short-Term Focus at the Expense of Long-Term Strategy

Succumbing to the pressure for immediate results is a common mistake. PE firms typically have a finite investment horizon, but businesses must balance short-term objectives with a sustainable long-term strategy. Sacrificing long-term growth for quick wins can hinder the business’s overall success.

Financial Mismanagement

Inadequate financial controls and mismanagement are prevalent errors. Accurate and transparent financial reporting is essential in the post-PE landscape. Businesses that fail to implement robust financial controls risk falling short of expectations and damaging the relationship with PE investors.

Resistance to Change and Adaptation

Resistance to change can impede progress. PE investment often comes with a mandate for strategic shifts, and businesses that resist adaptation to new market realities or operational approaches may find themselves at odds with their PE partners. Embracing flexibility and a willingness to evolve is key to success.

This, by far, is the biggest area of struggle for companies that have just received PE investment.

Your once family-run business culture is changing to a more performance-based culture. Like any change, it often leaves us feeling uncomfortable. After investment, you now have a partner with growth expectations, and you must achieve them with new people, processes, and systems.

Avoiding these common mistakes is pivotal for businesses seeking to maximize the benefits of PE investment. By fostering transparent communication, optimizing operations, managing talent effectively, balancing short-term and long-term goals, implementing robust financial controls, and embracing adaptability, businesses can navigate the post-investment landscape more effectively. Learning from these pitfalls is essential for building a strong and mutually beneficial partnership with PE investors.

Let’s schedule a call if you just received a PE investment, and we can help you avoid costly post-investment pitfalls.

For entrepreneurs, securing Private Equity (PE) investment is a significant milestone that brings excitement and change. Beyond the infusion of capital, business owners’ lives undergo a profound transformation. This blog explores how the landscape shifts for entrepreneurs we have experienced after welcoming PE investment into their ventures.

Private Equity (PE) investments often herald a new chapter for businesses, marked by growth, strategic shifts, and enhanced operational focus. However, there are instances when the alignment between business owners or founders and PE firms falters. In this blog, we explore the circumstances that may lead PE firms to consider replacing a business owner or founder and the timeframes involved in adapting to PE firm expectations.

Recognizing the Need for Change:

Deciding to replace a business owner or founder is a delicate and strategic decision for PE firms. Several factors may contribute to the recognition that a change in leadership is necessary:

1. Misalignment with Strategic Vision:

When there is a fundamental misalignment between the founder’s vision and the strategic direction envisioned by the PE firm, it can trigger discussions about leadership changes.

2. Failure to Meet Performance Expectations:

If a business owner consistently falls short of performance expectations set by the PE firm, especially in key financial or operational metrics, it raises concerns about the ability to achieve the desired returns.

3. Resistance to Change:

PE investors often initiate changes to optimize operations and drive growth. If a founder resists necessary changes or fails to adapt to new strategies, it can lead to a reassessment of their role.

4. Governance and Ethical Concerns:

Governance issues or ethical concerns can prompt PE firms to reevaluate leadership. Maintaining a strong ethical foundation and transparent governance is crucial for the success of any partnership.

Timeframe for Adaptation

The timeframe for a founder to adapt to PE firm expectations varies based on several factors:

Defined Expectations from the Onset:

Clear communication of expectations at the beginning of the partnership sets the tone. When PE firms outline specific goals, performance metrics, and strategic directions, founders have a clearer roadmap for adaptation.

Performance Review Periods:

PE firms typically conduct regular performance reviews. The frequency and intensity of these reviews can impact the timeframe for adaptation. Consistent underperformance over multiple review periods may shorten the time available for adjustment.

Commitment to a Collaborative Approach:

A collaborative approach between PE firms and founders can extend the timeframe for adaptation. Open communication, willingness to address concerns, and joint problem-solving contribute to a smoother transition.

Flexibility and Willingness to Learn:

Founders who demonstrate flexibility, a willingness to learn, and an ability to adapt to changing circumstances often have a more extended period to align with PE expectations.

Specific Areas of Concern:

The nature of the concerns or areas where the founder is falling short also plays a role. Some issues may require immediate attention, while others may allow for a more gradual adjustment period.

Conclusion:

The decision to replace a business owner or founder is significant for PE firms and is not taken lightly. The timeframe for adaptation depends on the specific circumstances, the clarity of expectations, and the collaborative efforts of both parties. Open communication defined performance metrics, and a commitment to a shared vision contribute to a more effective transition. Ultimately, the goal is to align the leadership with the strategic objectives of the PE firm, fostering a partnership that maximizes the potential for success and growth.

Business owners and founders who adapt to the requirements of their PE partner survive and thrive. Founders who struggle to adapt to the PE firms’ expectations and requirements for transparency often must leave. “ This is not how we do things “ is not a conversation to have once you have partnered with a PE firm. They want and need your experience and market knowledge, but they also want to instill a performance-based culture.

If your firm just received investment from a PE firm and you are feeling the heat from friction with your PE partner, let’s schedule a call, as I have helped several founders navigate this change.

If you are a PE firm partner and one of your investments is failing to meet the objectives you have put in place, and you feel constant friction with the founder or business owner, let’s schedule a call.