Our transaction is currently in the ninety-day window between signing the LOI and closing, and the constant stream of diligence requests is distracting our leadership team from running the business. How do we structure our operating system to protect our quarterly performance and prevent a late-stage price reduction?

Question

Tyler Smith · Accepted Answer

The period between the letter of intent and closing is the most vulnerable phase of any deal. Buyers will watch your monthly numbers like a hawk. If your financial performance dips because your leadership team is focused on answering diligence questions rather than running the business, the buyer will use that dip to re-negotiate the purchase price.

To protect your operations, you must segregate your leadership team roles immediately. Divide your team into two groups. The first group, typically consisting of the visionary and the integrator, handles the transaction and the due diligence requests. The second group, consisting of your key departmental leaders, remains entirely focused on executing your quarterly Rocks and hitting your scorecard targets.

Keep your Level 10 Meeting™ schedule disciplined. Do not let these meetings degenerate into deal discussions. Use the IDS® process to isolate and resolve any operational issues that arise from the distraction of the sale. If a departmental leader is getting pulled into diligence calls, delegate those tasks to a middle manager or external advisor.

Your business must run as if the sale is not happening. By maintaining operational focus and continuing to hit your scorecard metrics, you send a powerful signal to the buyer that your company is a self-sustaining machine. This discipline protects your leverage and ensures you walk into the closing room with your agreed-upon valuation intact.