We just signed our LOI and are moving into the confirmatory due diligence phase, but we do not want our leadership team distracted from hitting our quarterly Rocks. How do we divide our internal resources and structure our weekly communication to keep the deal on track while maintaining our numbers?

Question

Tyler Smith · Accepted Answer

The period between LOI and close is the most dangerous phase of any transaction. If your leadership team takes their eyes off the ball, operational performance will slip, and the buyer will use that dip to chip your valuation. You must separate your deal team from your operating team. Identify one or two people on your Accountability Chart (typically the visionary and the integrator or finance lead) to handle the deal flow. The rest of the leadership team must remain focused on running the day-to-day business and hitting their quarterly Rocks. Use your weekly Level 10 Meeting™ to maintain this division of labor. Do not let the transaction dominate the entire meeting. Keep the agenda focused on your weekly scorecard, Rock progress, and people headlines. Dedicate no more than five minutes to a high-level deal update. If transaction issues arise that require leadership input, move them to the IDS® portion of the meeting, but only if they directly impact operations. Otherwise, handle all deal-specific problem-solving in a separate, dedicated weekly alignment meeting involving only your designated deal team. By protecting your leadership team's focus, you ensure the business continues to hit its targets throughout due diligence. Showing a buyer that your company can navigate a transaction without dropping its numbers is the ultimate proof of operational maturity.