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2 types of business owners and which one makes the most income - ANSWER: 1) Lifestyle Business Owners and value creators (value creators make the most b/c they are considered best in class Common characteristics of value creators - ANSWER: 1) They do holistic planning 2) Harmonize personal, financial, and biz 3) Personal aspirations and life beyond biz 4) Mitigate risk 5) execute relentlessly well ___ % of value of business tied to ___ assets - ANSWER: 80%/ intangible What is a deliverable? - ANSWER: An outcome produced by an action. Ex) could be a report, meeting, workshop, event 3 Gates of the Value Acceleration Methodology - ANSWER: 1) Discover 2) Prepare 3) Decide 2 Major Deliverables of Gate 1/Discover Gate - ANSWER: 1) Triggering Event 2) Prioritized Action Plan What is the Triggering Event? - ANSWER: An independent personal, financial, and business assessment correlated to the business range of value
Why is the Triggering Event a supercharged valuation? - ANSWER: Bc it tells you what business is worth today AND what it's potential BIC value may be Triggering event triggers action ___ % of the time - ANSWER: 70 2 Parts of the Triggering Event deliverable in Gate 1 - ANSWER: 1) Business attractiveness and personal, financial, and business assessment 2) Determination of the present value and potential BIC value of biz What is the profit gap? - ANSWER: Difference between your potential best in class earnings and your current earnings. Measure of how much money you leave on the table each year What is the prioritized action plan? - ANSWER: Reflects the prioritization of personal, business, and finacial value factors to drive improved earnings and business value How is the action plan broken down? - ANSWER: 3 - 10 year vision of chosen destination, broken down into 1 year goals and 90 day sprints What is done in the prepare gate? - ANSWER: It's all about executing Action Plan relentlessly In prepare gate, ____ is the tool used to execute relentlessly - ANSWER: 90 Day Sprints Definition of 90 Day Sprint - ANSWER: Continual loop of prioritizing, measuring, reconnecting, and recalibrating every 90 days
Why don't BO do exit planning? - ANSWER: They think they don't know how and don't have the time ____ combines the plan, concept, effort, and process into a clear, simple strategy to build a business that is transferrable through the 4 C's. Future is addressed by creating value today. - ANSWER: Exit planning 5 Stages of Value Maturity Index - ANSWER: 1)Identify 2)Protect 3)Build 4)Harvest 5)Manage Describe Identify Step - ANSWER: Done in Gate 1, find where your biz benchmarks, have biz valued annually personally and financially Describe Protect Step - ANSWER: Create and implement prioritzed de-risking Action Plans What are the 5 Ds? - ANSWER: 1)Death 2)Disability 3)Divorce 4)Distress 5)Disagreement Describe the Build Value step - ANSWER: Take a longer term point of view, prioritizing more strategic actions to increase intangible capital Describe the Harvest Value step - ANSWER: Cashing in the biz Describe the Manage Value step - ANSWER: Managing personal value and financial net worth
Define Human Capital - ANSWER: Measure of the strength of your people, talent, ability to execute, ability to choose and prioritze, ability to adapt and innovate, energy and passion, grit, IQ, work independently Define Customer Capital - ANSWER: Measure of the strength of your relationships with whom you do biz. Focus on building deep, integrated, and recurring relationships with your best customers and suppliers with shared goals and beliefs. If one customer accounts for __ % of total revenue, it will likely reduce your value
- ANSWER: 25% Define Structural Capital - ANSWER: Measure of the strength of your strategy, systems, processes, capital, and financial structure that augment the Customer and Human capital on which your biz is built. Define Social Capital - ANSWER: Measure of the strength of your culture. Greatest predictor of success. ___ % of owners profoundly regret exiting the business. Why? - ANSWER: 75%/ Due to personal reasons, not financial ones What does S.T.E.P. stand for? - ANSWER: Spiritual/Things/Experiences/People The vision necessary to bring your business to life and life to your new business - ANSWER: Primary Aim What is your Wealth Gap? - ANSWER: Wealth goal minus your current net worth, not including your business value
The Triggering Event is completed in ___ of the Value Acceleration Methodology
- ANSWER: Gate 1 Define Triggering Event - ANSWER: A personal, financial, and business assessment correlated to the business range of value 5 Major Steps to Performing the Triggering Event - ANSWER: 1)Financial recasting to know your real number 2)Financial Analysis and benchmarking 3)Determining ROV and profit gap 4)Condicuting a business attractiveness and Personal, Financial, and biz assessment 5)Placing your biz in ROV and determining Value Gap Your goal is to set up no more than ___ - ANSWER: 5 personal and 5 biz actions to implement in 90 day sprints Your first set of priorities should be ___ - ANSWER: De-risking- protecting what you already have 2nd set of priorities should be __ - ANSWER: Evaluate biz and personal models to determine whether they are aligned to meet your visions 3rd set of priorities - ANSWER: Focusing on efficiency 4th priority - ANSWER: Growth Final priority - ANSWER: Culture
Definition of 90 day sprint - ANSWER: Continuous loop of prioritizing, executing, measuring, reconnecting, and recalibrating every 90 days
