Some members of our leadership team want a strategic acquisition by a competitor, while others want a management buyout. How do we resolve this fundamental disagreement about our exit path?

Question

Tyler Smith · Accepted Answer

A leadership team divided on the exit strategy is a massive liability that will destroy your company value during due diligence. To resolve this disagreement, you must return to the foundational pillars of Our Charter, specifically the Same Page pillar.

The owners of the business must first define the long-term vision in the V/TO®, including the 10-Year Target and the target exit date. Once the ownership group is aligned, this vision must be communicated to the leadership team with one voice.

If leadership team members have conflicting personal agendas, you must address them openly. Use the IDS® process to identify the root of their concerns. Often, anxiety about a strategic acquisition stems from fear of job loss, while a preference for a management buyout stems from a desire for equity. Address these fears directly by discussing potential retention bonuses or clear post-exit roles.

The team must align behind the chosen strategy and say Yes to the strategy and structure. If a leadership team member cannot commit to the chosen path after full discussion, they do not GWC™ their seat, and you must transition them out before the exit process begins.