Business.com

Business.com

5 Ways to Overcome Procrastination to Be More Influential

Posted: 13 Nov 2019 08:00 AM PST

We have all procrastinated. We set a goal to accomplish a task, only to become distracted on something less important. It's easy to put off the thing we don't want to do for the thing that really doesn't need to be done. Before we know it, we are rushing like crazy to meet a deadline, or even worse, we miss it entirely.

Do you ever consider how much time you spend procrastinating? It's typically longer than the actual work would take. We delay the inevitable because it feels like too much work, or we feel a sense of dread in doing it. Imagine what we could accomplish with the time and brain space freed up after accomplishing a task instead of hunting for every excuse not to do it.

Procrastination, or the art of perpetual delaying, comes from a Latin verb procrastinare defined as "to put off until tomorrow." But this goes beyond our choice to delay efforts. The word is also derived from an ancient Greek word akrasia which means "doing something against our better judgment."

Procrastination is the one thing that differentiates people with influence from those who don't have it. Influential people do the work. They show up every day, without excuses, ready to put forth the effort to get a job done, improve their skills or rise to the next level. They bring a positive attitude to each day and see opportunity in everything. Procrastinators, on the other hand, put off the work required to accomplish tasks. They are perceived to lack self-awareness or motivation. Many think procrastinators are lazy and poor time managers. In reality, procrastinators live in a state of negativity: They dread work and putting forth effort. As a result, they lack the influence they need to get a promotion, land a new job, guide a team to success or accomplish greatness.

Studies show that procrastination is really negativity in disguise. Dr. Piers Steel, a motivational psychology professor at the University of Calgary said that procrastination is a form of self-harm. If we know delaying makes us feel bad, why do we voluntarily do it?

Professor of Psychology, Dr. Sirios of the University of Sheffield described procrastination as an irrational behavior that people engage in when they don't know how to manage a negative feeling that they have about a task.

That negativity comes across in your communication with others, your choice of words, body language and everyday presence. It causes doubt in others who hear your words and witness your day-to-day choices. Ultimately, people respond to you, your requests and ideas with the same lack of urgency. If others witness your ongoing delay tactics, they will respond similarly. If you wait around for people to call you back, answer your emails, accept your meeting invites or deliver on deadlines, it's because you lack the influence to get them to act.

It's not too late. If you're a why-do-today-what-you-can-do-tomorrow type of person but see the need for change, here are five ways to make a proactive effort:

1. Don't spend your time; invest it. 

Procrastination costs us valuable time and energy that could be invested elsewhere. Despite knowing this, we go against our better judgment to put off our work. When you choose to do the work, you'll use your energy in a productive manner and you'll feel accomplished afterward. Best of all, you'll be investing in your own reputation, credibility and the trust others have in you. Consider time like money. You can spend it frivolously here and there without real focus and accountability, or you can invest it in ways that pay dividends.

2. Know your "why." 

Deciding to change your procrastination habits is easy, but doing it takes hard work and consistency. Your bad habits didn't develop overnight, and neither will the improved habits you want. The easiest way to stay focused is to know your "why." Perhaps you want to change because you want a promotion, a raise or more influence in the workplace. Focus on your "why" and commit to doing the work now.

3. Begin with the end in mind. 

Begin each day determining one thing you can do to become a more effective communicator. Perhaps it's shortening your response time on emails and phone calls. Maybe it's arriving on time for meetings. Either way, choose one objective each morning to focus your efforts on throughout the day. Commit to accomplishing your daily goal in a timely fashion, without delay.

4. Commit to your calendar. 

Set aside designated chunks of time throughout the day to focus on tasks you would otherwise put off. Commit to those timeframes as you would a meeting with a client or your boss. Take it seriously and work with focus and commitment throughout the scheduled time. Mark your calendar, quiet your phone and set aside anything that may distract you. Focus all your efforts on accomplishing what you can. Over time, this will rewire your brain to know what is expected and how to operate best.  

5. Reward yourself. 

One downfall of procrastination is that we often seek something else to do so we don't have to accomplish our task. We waste our time and expend energy on what doesn't matter. We end the day wondering what we accomplished and where our time went. Worse still, we frustrate others with our inability to focus and get done what is required.

One way to change your mental programming is with simple rewards. This is known as temptation bundling. For instance, if you dread responding to emails and are known for taking days to get back to others, commit time each day to focus entirely on emails. When you're done, reward yourself with something – a short walk, a phone call with a friend, a few minutes of "you" time that allows your mind to make a positive connection. The biggest reward will come over time as people begin to see your efforts, trust you will respond in a timely manner and allow you to influence their actions accordingly.

Procrastination is not a time management problem, it is an emotion management problem. It doesn't require us to get a fancy calendar or download a new productivity app. It's our childlike way of putting off what we know must be done even when we don't feel like doing it. It costs us our credibility, reputation and ability to influence others to act on what we have to say.

We are in control and have the power to do the work necessary to change our procrastination tendencies. It requires identifying the negative moods attributed to specific tasks and challenges us to stop resisting the change necessary to be taken seriously at home and at work.

Now is the time to realize that the reward of influence, credibility and trust far outweighs the pain of putting off tasks and the guilt that comes along with it. Get started by identifying where you delay and become aware of these habits so you can begin making necessary, positive changes. Now is the time to own your bad habits and stop putting off until tomorrow what you can do today.

How to Increase Productivity at Your Workplace

Posted: 13 Nov 2019 07:00 AM PST

People usually have a dedicated workspace or office because they find they work much more efficiently without the distractions of home. In some circumstances, it also allows for a better work/life balance, as the home is for family life and downtime, whereas the office is purely a place for work. Working from home can often blur these lines.

Office spaces can – and ideally should – be crafted to improve the productivity of each individual employee, by designing the workplace better. An article in Inc. mentions that practical office design solutions tend to help workers focus more.

However, functional design is only one-half of the equation. Businesses also need to include a methodology for helping workers find mental peace. The modern world is increasingly hectic, and workers that have their minds focused on other things can't function at peak performance levels. Companies can incorporate several things, both in their design, and to promote positive office culture, to help their employees enjoy their jobs. Here we explore some of the measures that businesses can put in place to help their employees be more productive.

Build off the company's mission

A mission statement, as Shopify informs us, is a pure expression of a company's existence. The business's purpose, however, doesn't always translate well to the employee's goal of doing his or her job. By incorporating the company's mission into the everyday workings of an office, a business can promote its reason for existing alongside what it needs from its hires. Harvard Business Review notes that when employees have a sense of purpose, they are usually far more productive. Individual goals tend to allow for more self-motivation in getting work done.

Incorporate individual and collective achievements

Employees are individuals, but most companies seem to overlook this fact. As a business grows, it's unlikely that individuals remain working by themselves. When projects scale up, work teams need to do the same to cope with the workload. As the company has already given employees their own sense of purpose, the next step is to bring individuals together to provide a working environment that focuses on the overall goals of the business. However, these goals also help individuals pinpoint the targets they need to achieve from a specific project.

Collective achievements can only be obtained if everyone is mature in how they approach the project. A company that's operating on a team-based system needs to have project planning in place so that everyone is aware of what others are doing. Alongside project planning, weekly meetings that help employees pinpoint their short-term goals can keep the system moving and offer milestones that motivate employees. Finally, feedback among team members is essential. The marketing agency Distilled mentions that it considers feedback to be the most critical factor in creating a good team. Without proper feedback, communication suffers and causes the entire team to fail.

Include psychological cues to boost work productivity

Psychology has shown several ways in which the things that surround an employee could affect his or her mental state. To this end, a business could consider using these psychological cues to help employees increase their focus. Among the elements that a company can incorporate include:

  • Music. A study in the Journal of Consumer Research mentioned that music at around 60-70 decibels created a more conducive environment for people working on both monotonous and creative tasks.
  • Plants. The New University of Technology Sydney stated that plants may have a beneficial effect on the mental state of employees within an office environment.
  • Lighting. Interior lighting can have a significant effect on the mood of individuals within an office space, according to designer Stanley Felderman, as quoted in a blog post for The University of North Carolina at Chapel Hill's Kenan-Flagler Business School.

Change the background a bit

Office work can be dreary. It doesn't matter if you're working out of a cubicle, or have an office rental in Sydney, eventually changing the scenery is necessary to get productivity to its peak level. Changing landscape doesn't necessarily mean offering an employee a chance to work from home for one or two days. It can be achieved by making the break more inviting or by creating "living nooks" around the office that offer something better than a desk and chair to get work done on. Some employees are far better at working on a couch than in a cubicle.

Encourage employees to help each other

Human beings are social animals, and ever since they existed in tribes, the natural inclination is towards helping others. Proof Hub notes that collaboration helps to make a company more efficient and gives a more equitable distribution of work across all segments. Collaboration takes multiple methodologies, including brainstorming, cross-document collaboration, or picking up projects where other employees get stranded. Additionally, this sort of partnership fosters teamwork and a more united attitude towards the job.

Offer workers the tools they require

Modern workplaces can provide a wide array of the necessary equipment to get work done. Software is a prominent part of this structure. Most companies have an inventory of computers that are loaded with the software they want their employees to use. Keeping these assets up to date ensures that employees can get the job done when they need to. Updating hardware and software also means ensuring that these updates are timely.

It can be tempting to give employees more software than they need on a system, especially if the employee is a multi-tasker. Instead of it helping the situation, it could lead to the employee getting sidetracked on jobs and responsibilities that are not theirs. Keeping workstations focused can help to keep employees fixed on a project as well.

Don't forget to take a time-out

Business Insider mentioned that breaks fuel better productivity in employees. The tipping point, according to work done by the Draugiem Group, is around fifty-two minutes of work to seventeen minutes of rest time. The most critical element mentioned in the study was that these seventeen minutes needed to be spent away from the computer for it to have a better effect on the employee. Relocating to a new room or a water cooler would be an ideal method for implementing these breaks. To keep fit and help to exercise some muscles, employees could consider taking that seventeen-minute break to stretch a bit.

Make achievements public and celebrate them

While some employees aren't a fan of having their work celebrated, doing so helps them to see that their work is appreciated. The Houston Chronicle recommends developing an employee recognition program that outlines the benefits the employee has presented to the company. Celebrating achievements offers employees the chance to enjoy the fruits of their labor in the short term. The achievement might not be an essential goal, but it does constitute a milestone. It is important to remember that this celebration needs to be genuine, or else the feeling it gives to an employee could be compromised by the sense of insincerity.

Appreciation is the key to productivity

A productive office doesn't need a lot to maintain its efficiency. The workers are a competent bunch, and with the right incentives and celebration of their successes, the company culture can fuel even higher productivity. Office design contributes to the overall productivity of employees, but companies shouldn't spend too much time focusing on the physical aspects of their business's layout. Instead, focus on the creation of a company culture that welcomes all, and celebrates them as people and individuals, not just as cogs within a machine.

How to Set Entry-Level Women on a Path for Advancement

Posted: 13 Nov 2019 06:00 AM PST

Managers, especially those of young female professionals, are on the front line in the struggle to achieve gender parity. These managers have the power to set women on the right path and reverse the cycle of discontent that occurs when women's careers stall after a few years. When managers give regular feedback about expectations and performance, provide coaching about broad organizational context and facilitate exposure to decision-makers, they set the stage for women to succeed.

Ruth, a mid-level employee, provides an example. She put her name in for a job opening that would advance her career within the organization. When Ruth looked at the position description a second time, however, she withdrew her name. Ruth wasn't comfortable applying for a job for which she wasn't 100% qualified.

When Ruth learned that a male colleague had put his name forward for the same position, she thought, "I'm surprised he's putting his name forward when he doesn't have all the qualifications either." 

Then Ruth had another surprise. The hiring manager asked why she had withdrawn her name. Ruth explained that she didn't meet all the qualifications. 

"You don't understand," answered the manager. "I want you in that position. I think you're perfect."

Ruth, like so many of her female peers, created barriers to her own advancement. Why? One reason is that women have a different understanding of "perfect for the job" and "perfect in the job" than their male counterparts.

Women tend to enter the workforce with the assumption that outstanding work will be noticed and get them promotions. So, they overdeliver. For the first couple of years, it works. Women's hard work is initially noticed and rewarded – but then things change. Promotions begin to go disproportionally to men, who don't seem to be working as hard. Women begin to feel discontent and resentful. Often, they leave the organization and join another one, where the same thing happens.

This dynamic occurs because women and men have different understandings of how rewards work in organizations. At root, they differ in how they understand performance. While men focus on what they need to do to meet objectives, women focus on what they can do. In short, they overperform and exhaust themselves.

When women overperform on non-critical projects, not only do they feel exhaustion, they lose the capacity to focus on other factors essential to career advancement. Men perform at the needed level and use the rest of their capacity to notice what opportunities are in front of them. They observe how the executives and influencers keep score, build relationships and position themselves for advancement. Men strategize based on what they learn.

If we want to achieve gender parity, we must ensure that women have a realistic understanding of how performance and rewards work. We must start with entry-level women before they create their own barriers to advancement. 

In my work with Fortune 1000 companies, I've come to see managers as a critical link to making gender advancement a reality. When managers provide women with guidance, skill development, and exposure to influencers, women advance – and everyone wins. Here are three ways in which managers can close the gap.

1. Provide guidance and feedback about performance.

Being intentional about providing regular reviews of expectations and performance creates opportunities to guide young women in real-time. On a project by project basis, managers can point out the difference between overperformance and what needs to be done to move critical projects forward.

Managers can also help early-career women think about their roles in the context of the larger organization. With clarity on how their capabilities lead to an impact on the business, women find it much easier to set appropriate priorities, rather than try to do everything. Clarity about priorities breeds confidence, an essential ingredient for advancement.

For example, if Ruth had understood how her capabilities matched the most critical elements of the open position, she would have stepped forward, knowing that the lower priority aspects of the job could be managed. She would have had the confidence needed to advocate for her own advancement – as her male colleague did.  

2. Provide exposure to the broader goals of the business. 

Managers need to encourage curiosity in their young employees, especially regarding the financial metrics that drive their businesses. Women need to understand those metrics and how their own work contributes to them. 

Every organization has rules and a scorecard; young women need to know that it doesn't hurt their integrity to know and strategize within those rules. As they present their ideas, initiatives, and requests for advancement, women will be most successful if they speak in terms of metrics and priorities.

It's a manager's job to share broad business information and create opportunities for exposure, including participation in cross-department teams and/or stretch assignments. In discussing career paths, managers have the opportunity to give feedback about their employees' strengths, recommend steps to expand skills, and point to opportunities to gain experience in profit and loss functions. Such experience not only provides the employee knowledge about what drives the business, but it also affords essential credibility in the minds of decision-makers.

Helping women build skills in negotiation may be especially helpful. According to a Harvard Business Review article, "Women Rising: The Unseen Barriers," one of the subtle biases toward women is placing them in staff roles rather than ones with profit and loss responsibility.

Negotiation skills are needed to gain access to the critical jobs. According to a 2016 Catalyst report, employees – both women and men – who successfully negotiated their roles were 42% more likely to have profit and loss responsibility. They were also 30% more likely to lead projects with "very great" visibility to the C-suite than employees who were not successful at negotiating their roles.

3. Create opportunities to connect with decision-makers, influencers, and mentors. 

Top-tier managers create connections between their reports and key people. They also coach them to make the most of the encounters. For example, a manager may invite a young professional to participate in a meeting with senior leaders. The opportunity to observe senior leaders is valuable, and coaching can increase that value. The manager can prepare the employee by helping her identify important things to share in the meeting in order to move the business objective forward and show her expertise. 

It's especially important for managers of young female employees to help with assignments and introductions. Generally speaking, women are hesitant to ask for mentors and sponsors, and formal mentoring programs don't always work. Astute managers talk with their female employees about the importance of relationship building. They also recognize that women claim to learn best about effective business strategies from successful women. The managers smooth the way to make those connections happen, at multiple levels.

Many CEOs and executives have joined the struggle for gender parity. Their commitment to organization-wide initiatives is admirable, and those initiatives need to continue. At the same time, every manager has a unique opportunity and responsibility to add to the pipeline of savvy, skilled and confident women. When managers give regular feedback about expectations and performance, provide intentional coaching about broad organizational context and facilitate exposure to decision-makers, they set the stage for gender parity. While a manager's role may not be splashy like a formal and expensive development program, it's critical. Let's embrace it and appreciate that role.

Is a Free POS System Right for Your Business?

Posted: 13 Nov 2019 05:15 AM PST

  • The price of a point-of-sale (POS) system often directly correlates to the features, limitations and convenience it offers.
  • A free POS system can save you money and is ideal for small businesses that rarely process card payments and don't need advanced POS software functions.
  • Most free POS systems are tied to high transaction fees, limited features or multiyear processing contracts.
  • To choose a free POS system, analyze your budget, industry, business size and the feature you need.

A point-of-sale (POS) system is an integral component for most businesses, and it's challenging to find the system that's the right fit for your company's specific needs. Since POS software and hardware are available in various combinations and price points, business owners can pick and choose what works best for them. Sometimes, that best option is free of charge.

However, the age-old saying "you get what you pay for" rings true more often than not – and POS systems are no exception. Although using a free POS system to complete your consumer transactions may seem like a great option, it has its own set of pros and cons.

John Moss, CEO of English Blinds, said business owners should be wary of the limitations and additional fees that can come with a free POS system.  

"There are free POS systems in as far as there are systems you can get in place without any upfront cost, purchase price, or set monthly fee, but these typically cost more per transaction or have limitations in place in order to counteract this," Moss told business.com. "There is no such thing as a free lunch, after all, just different ways of paying for things."

It is essential for business owners to evaluate the benefits and limitations of free POS software before jumping into a plan that may be too good to be true. The best POS system for your business will depend on your business size, industry, budget and the features your business needs.

 

Editor's note: Looking for the right POS system for your business? Fill out the below questionnaire to have our vendor partners contact you about your needs.

 

 

The benefits of using a free POS system

Free point-of-sale software is sometimes included with your mobile credit card processing service. This can be the right choice for some small businesses; it all depends on what you need to use the software for. The most obvious (and likely the only) benefit is cost savings. Some POS systems can cost hundreds or thousands of dollars, which may not be practical or even possible for very small businesses that perform few card transactions.

"The pros of using a free POS system are that if you rarely process card payments, you don't have to pay a set or upfront fee for a system you're not getting much benefit from just to serve the occasional client," said Moss. "You also don't tend to get tied into a contract."

Although pay-as-you go pricing and no long-term contract may be the only real advantages of using the free point-of-sale option from a mobile credit card processor, it can be beneficial enough that some small businesses prefer it. If you do not need to process many credit cards and don't require the added benefits of many paid POS systems (e.g., inventory tracking, employee and customer management, third-party software integration), a free POS system can be a great addition to your business operations.

If you are not locked into a POS contract, you have the luxury of switching to a different POS system later on, once your business expands or your credit card processing needs change.

The limitations of using a free POS system

Free POS systems are advertised as just that – free – but this is not always the whole truth. Although initial setup costs, a monthly POS software subscription or the purchase of POS hardware may be omitted, you are often still on the hook for credit card processing fees. Keep in mind that free POS systems typically restrict your ability to choose your own processor and come with higher transaction fees than their paid counterparts. This is a setback if you process a high volume of credit card transactions. 

With a free POS system, what you save in money is often lost in features. Moss said that these feature limitations vary by POS provider, but it's common for free systems to limit your number of inventory items, registers or users. Although some POS software can be costly, the capabilities typically match the price.

If you anticipate that you will need the added capabilities that many paid POS systems offer, it may be difficult to find a free POS system that can accommodate your needs. Most free systems come with basic purchasing capabilities, not the paid perks. You're unlikely to find a free POS system that has convenient features like inventory tracking, sales data or business performance reports, third-party integrations, and customer and employee management.

Consider which features your business currently needs as well as which ones you will likely need in the future. Although the "free" price tag may be enticing, it might not be a practical option for your business. This is especially true for larger businesses and those that conduct many credit card transactions each month.

The best free POS systems

There are several POS systems that claim to be free; however, they often charge for certain features and add-ons. For this reason, it is important to evaluate POS software and hardware on your own to see if a system suits your specific needs and budget.

When looking for the best free POS system, you will likely find mobile credit card processors that provide free POS software – as long as you use that company as your processor too. Some of the best companies that do this are SumUp, PayPal and Square. Keep in mind that if you choose one of these processors, you will be locked into using one credit card processor, instead of having an open-source POS system that is compatible with a variety of processors. This can be problematic if you want to switch to a credit card processor with lower prices or better features.

Based on our research, Square is the best low-fee credit card processing service available, and its basic POS system is one of the most robust. It charges flat-rate transaction fees and has several features that you can add to your system later as your business grows. These are important benefits to consider when choosing a free POS system.

Be wary of processors that offer free POS systems but require you to sign lengthy contracts. For example, some providers offers free POS hardware if you sign a multiyear contract for processing, but you usually still have to pay for a monthly POS software subscription. The contracts aren't very merchant-friendly, as they're noncancelable – even if you go out of business.

The free POS systems from eHopper and Loyverse are good options for small businesses like cafes, beauty salons and retail stores that are looking for a free mobile POS system. However, these free systems have limitations. For example, Loyverse charges a monthly fee for additional features like inventory or employee management, and you'll need a to subscribe to eHopper's paid plan to be able to call customer support.  

What is the best free POS system for bars or restaurants?

If you have a small counter-service restaurant or cafe, you may be able to successfully use free POS software. It'll be significantly more difficult if you have a full-service restaurant or bar and need restaurant-specific features like ingredient-level inventory tracking, tab management, tip tracking, and menu or table management.

Loyverse has a restaurant version of its free POS software that has a good selection of features, such as order management with modifiers and inventory management that can track ingredients. However, you'll likely want to subscribe to its paid advanced inventory module so you can make stock adjustments, conduct inventory counts and manage purchase orders.

Likewise, eHopper's free POS software offers some restaurant features, including order modifiers and tip management, but you'll need to upgrade to a paid plan to access a menu builder, ingredient management and low-stock alerts.

How to choose a free POS system

Given that there are several free POS system options available, each with its own capabilities and limitations, it is important to assess your current business needs before choosing a system.

To help you choose the best POS system for your business, here is a checklist of important factors for you to analyze your specific POS system needs.

  1. Budget: Set a realistic budget for how much you can spend on a POS system. This budget should include the cost of POS software, POS hardware and credit card processing. If you are starting a new business, your budget for your point-of-sale system may be tight; however, keep in mind that your budget may increase as your business scales.
  2. Business size: The size of your business and the number of registers and locations you have can affect the type of POS system you need. A very small business with few credit card transactions may get away with a free POS system, whereas a large retailer with several registers – or even multiple storefronts – will need a more comprehensive POS system.
  3. Industry: The industry you are working in will determine which type of POS system you need. Do you need a restaurant POS system that can accommodate reservations and seating arrangements, or are you a small retailer that needs basic inventory management?
  4. Features: In addition to industry features, the POS capabilities you need will depend on your personal preferences. Are you OK with a simple POS system that is limited to purchasing transactions? Do you want comprehensive POS software that integrates with your accounting and marketing systems to automate business operations? These features will determine whether you can partner with a free POS system or require a paid version.

The decision of whether a free system is worth the lack of features is not one to take lightly. A POS system can drastically impact the effectiveness and accuracy of your business. Consider all of your specific needs to determine the best option for you.

"If you only take card payments occasionally, a free POS might be a good fit for you and serve all of your needs at the lowest relative cost," said Moss. "However, if you keep a large inventory, receive a lot of card payments, process high-value transactions, or need to operate across multiple registers, users or locations, a free POS system probably won't meet your needs or be cost-effective."

6 Steps to Successfully Buy a Company

Posted: 13 Nov 2019 05:00 AM PST

The decision to purchase a business is a large one, whether you are an individual, a set of individuals or a business buying another organization. There are several concrete steps to make the process easier that serve as an excellent guide of what to consider before acquiring a company. 

For nearly a decade, I advised organizations looking to acquire new assets in order to increase their scale, profitability and market competitiveness. During this time, I developed a key set of steps to effectively assess the viability of a target company for a potential acquisition.

This guide to buying a company encompasses what I learned during my time as a merger and acquisitions (M&A) advisor and can be a good roadmap for acquiring an asset to create value and expand your market reach. The following are the six concrete steps you should take when considering whether or not to purchase a company.

1. Develop your story.

Why are you seeking to acquire a company? What are your main goals of the acquisition? What type of transformation are you aiming to make within your organization? Answering these important questions is the first step of successfully buying a company. 

You should understand and clearly map out the end goal and long-term vision of your organization to fuel your acquisition strategy and decisions. For example, are you seeking to buy a company to increase your supply chain control, enter a new territory or eliminate a competitor? 

Develop the story of your acquisition and how it will fit into the larger goal of your organization and its future growth. Once you have this clear picture in mind, use it to drive the next five steps for buying a company.  

2. Create search criteria.

After clearly defining why you seek to buy a company, it is vital to develop a set of search criteria based on the acquisition's goal. Search criteria should narrow down the type, size, industry, geography, etc. of the companies you would consider buying.

Developing these criteria will allow you to conduct a more strategic, targeted and efficient search. You should decide them based on your budget, goals and resources to make this seemingly arduous task go much more smoothly. Organize the search criteria on a centralized document that all decision-makers can access in order to align acquisition efforts and goals. 

3. Do your research.

Once you find a select group of companies you would be interested in buying, it's essential to conduct preliminary research on each organization, its leadership, culture and business trends before taking any further steps. While conducting this research might seem like an obvious next step, many people may not know how to approach this process most effectively and efficiently. 

One way to make the research process go smoothly is to access and make use of industry databases. There's a host of databases and software currently available that provide important insights on a company's revenue, market competition, growth rate, financing history and more. Databases such as PitchBook, CB Insights and S&P Global Market Intelligence are great resources. These databases will organize and provide the data you need in an efficient manner so that your acquisition process can move swiftly. 

It's also important not to overlook the power of simple internet research. Google searches present essential information discerning a company's news, culture, industry insights and brand awareness. LinkedIn searches provide insight on the number and caliber of employees, including who the company's top executives are and how the hierarchical structure is set.

This research will not only allow for a stronger decision-making process, but also enable you to more effectively negotiate deal terms and to execute integration strategies should the transaction proceed. 

4. Perform effective outreach.

The next step in successfully buying a company is to conduct effective outreach to the organizations you are interested in. This simply means getting through to the company's key decision-makers and delivering a strong, clear pitch for an acquisition. 

Effective outreach requires persistence, effort, and in-depth knowledge of your message and value proposition. Your outreach efforts will be most successful if you strategically select your channels for connecting with decision-makers, craft your message carefully, add a clear and concise value proposition, and follow up without exception. 

Traditionally, most outreach is conducted by phone. However, if decision-makers from your target company are not responsive to this outreach and happen to be very active on other channels, such as LinkedIn, it may be best to form a connection directly through that platform. These observations are highly important. 

Breaking through gatekeepers at a target company to discuss potential transactions is often a large challenge businesses face during outreach. How to best overcome this challenge was the topic of a recently published M&A Science interview. 

5. Conduct introductory meetings.

Once you've broken through to key decision-makers at your target organization and they express interest in a potential acquisition, you will likely conduct some form of introductory meeting. 

The first meeting between a potential buyer and seller is an incredibly important and telling part of the M&A process. This meeting, whether it is conducted in person or virtually, is an opportunity for both parties to express their goals and terms for the potential acquisition. 

Assessing deal fit and building a strong rapport are the key goals of introductory meetings. Both organizations should understand the intentions and motivations of the other as well as their market and financial attractiveness, enabling better deal decisions and providing important context for negotiations. During this meeting, also assess how well your organizations will integrate with one another should the transaction proceed. For example, how well do your cultures and operations align? Come prepared with prior research, any questions you have and a clear message.

If the introductory meeting is successful, you may consider signing a letter of intent (LOI), a nonbinding document outlining deal interest, terms and timelines. Signing this document will often give you further access to the other organization's financial, operational and legal materials to better inform the potential acquisition. 

6. Determine scaling opportunities.

Can the company you're considering purchasing scale with your own? Are there good opportunities for growth, or are there strong impediments? These are important questions to consider before making the final decision to buy a company. 

Before entering the due diligence phase, consider what information you need from the other company to effectively measure how it will scale and integrate with your current organization. How will its culture, operations, finances and market scope align with your own? 

Determining any integration roadblocks early in the process will allow you to work internally to prepare for day one, ideally leading to increased value creation and long-term deal success. 

At this point, bring the acquisition decision back to the first step of this guide. Will buying this company result in the goals you've laid out and provide your organization with the best way forward?
Posted by: at

No comments:

Post a Comment

Subscribe to: Post Comments (Atom)