Transfer Your Knowledge And make Your Business Less Dependent On You To Increase The Value
by Dave Driscoll
To grow a valuable business – one you can sell – you need to set up your company so that it is no longer reliant on you.
Easy to say, but what if your business is something like a PR consultant or plumber, which revolves around selling your expertise?
To scale up a knowledge-based business, you first have to impart your knowledge to your employees so they can deliver the goods too. However, it is difficult to condense years of school and on-the-job learning into a few weeks of employee training. The more specialized your knowledge, the harder it is to hand off work to junior employees.
The key to scaling up a service business can often be found by offering the service that prevents customers from having to call you in the first place. You have to shift from selling the cure to selling the prevention. Fixing what is broken is typically a hard task to teach; however, preventing things from breaking in the first place can be easier to train others to do.
For example, it takes years for a dentist to acquire the education and experience to successfully complete a root canal, but it’s relatively easy to train a hygienist to perform a regularly scheduled cleaning.
It’s almost effortless for a real estate manager to hire someone to clean the eaves trough once a month, but repairing the flooded basement caused by the clogged gutters can be quite complex.
For a master car mechanic, overhauling an engine that has seized up takes years of training, but preventing the problem by regularly changing a customer’s oil is something a high school student can be taught to do.
For an IT services company, restoring a customer’s network after a virus has invaded often takes the know-how of the boss, but preventing the virus by installing and monitoring the latest software patches is something a junior can easily be trained to do.
When you’re selling your expertise, it can be tough to rely on your team to do the work for you. As ironic as it sounds, sometimes the key is to expand your own personal capacity by offering a preventive service, providing the time for you to mentor your employees. Some of your employees can focus on providing preventative services while you train others to step up to your level of expertise. This maintains your business income and provides the opportunity to increase the value of your business.
The value of your business will increase with less dependence on you! In contrast, think of the phrase “a linchpin company,” where the owner is the pin. Pull the pin and the wagon goes out of control! Make sure you are teaching every day; don’t wait until a crisis. Prepare your employees now to provide the services your customers need.
Transferring your knowledge will put more money in your pocket when you decide to embrace your “Life Beyond Business.”
Dave Driscoll is president of Metro Business Advisors, a business brokerage, valuation and exit planning firm helping owners of companies with revenue from $2 million to $15 million sell their most valuable asset. Reach him at DDriscoll@MetroBusinessAdvisors.com or 314-303-5600. For more information, visit www.MetroBusinessAdvisors.com.
Submitted 10 years 327 days ago