We are planning to sell to a larger strategic buyer who will likely want to integrate our operations into their existing platform. How do we document our Standard Operating Procedures (SOPs) on our exit runway to make our business highly digestible?

Question

Tyler Smith · Accepted Answer

Strategic buyers pay premium multiples because they expect to achieve synergies by integrating your business into theirs. However, if your operations are messy and undocumented, they will discount their offer to cover the high cost and risk of integration.

To make your business highly digestible, you must simplify and document your core processes. Start by using the EOS® 20/80 Rule™ to identify the twenty percent of your workflows that drive eighty percent of your results. Focus your documenting efforts only on these critical processes.

Ensure your documentation is clean and accessible:

- Create simple, high-level visual maps for each of your core processes rather than massive, unreadable text manuals.
- Document your workflows using modern, searchable software tools rather than static PDF files that quickly become outdated.
- Assign a clear process owner on your Accountability Chart for each core process to ensure they are consistently followed by everyone in the organization.

When a strategic buyer conducts operational due diligence, they should be able to hand your process documentation to their integration team and clearly see how your workflows will snap into their existing platform. Providing this level of clarity reduces their transition risk and justifies a top-of-market valuation.