During due diligence, how do buyers evaluate whether our leadership team is capable of hitting our long term growth targets, and how do we prepare our team for that scrutiny?

Question

Tyler Smith · Accepted Answer

During operational due diligence, sophisticated buyers spend a significant amount of time evaluating your middle management and leadership team. They want to know if the team can execute the future growth strategy without you. They will assess whether your leaders have the capability to scale the company or if they have hit their ceiling.

To prepare your team for this scrutiny, you must use the Accountability Chart and the GWC™ tool. Ensure every member of your leadership team completely Gets, Wants, and has the Capacity to do their job. If you have people in the wrong seats, you must address those issues before you enter a sale process. A buyer will quickly spot weak links during interviews.

Additionally, make sure your team is comfortable managing by metrics. A buyer will review your weekly Scorecard history and expect your leaders to explain how they track performance, identify issues, and solve problems using the IDS® process. When your leadership team can walk a buyer through their quarterly Rocks and demonstrate a track record of executing goals independently, it proves to the buyer that your company has a professional, high-performing culture that is worth protecting and paying for.