By William Seidman
In a recent newsletter published by the Leiden Capital Group, I wrote about how an organization’s success, and as much as 80% of an organization’s value, comes from the unconscious knowledge of its experts. These people really know what works (and what doesn’t work) and make huge contributions to leading the organization.
But they can’t usually tell you what they think and do that makes them so effective. Creating explicit value from this hidden expertise can significantly increase a company’s potential sale price.
This value is created in two ways:
- It demonstrates that there is an underlying system to the company’s success that any potential acquirer can easily utilize
- It improves current performance on a company’s key business metrics
Recording and using the best practices from the best and most respected people in the organization becomes a capital asset of the company that can be the cornerstone of valuation.
Discovering Expert Wisdom
Understanding and articulating how your top performers think is the biggest and least tapped source of value for your company. This is not just what they do, but how they conceive of the organization and their jobs. Read an earlier blog post, “The Wisdom Discovery Session,”
to see how to identify your top performers’ greater purpose.
Improving Current Performance
When everyone in the organization understands and aligns with the organization’s greater purpose, the organization’s energy increases dramatically. As one client put it, “Everyone is pulling on the same rope in the same direction.”
How is this accomplished? Through our experiences over the past 12 years, we have developed a methodology for organizational transformation that leverages persuasive technology.
As entire organizations improve their performance, productivity, financial performance, and value increase significantly.
What can you do to increase the value of your organization?
- Focus on your top performers; record their higher purpose and capture the things that make them great
- Get the rest of the organization to embrace those top attitudes and behaviors as their own
- Let potential buyers of your company know that the accumulated knowledge of the company is secure