9 Ownership Transition Issues Specific to Contractors

All businesses face challenges with an ownership transition.

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There are nine interrelated issues that heavily impact contractors. 

Succession: 9 Ownership Transition Issues Specific to Contractors.

We will dive deeper into each of these over the next week:

  1. Strength and alignment of the management team (post-deal)
  1. Culture of the company - Is it prepared for an ownership succession and compatible with the new owner? Seems “soft” but is very “hard” and can destroy value quickly.  
  1. Key relationship continuity with employees, customers, and others.
  1. Financial partner alignment with banking, surety, and possibly insurance.  
  1. Cash generation capabilities.
  1. Asset vs. stock sale - who owns past liabilities, how are they quantified, and what is the tax implication?
  1. Sustainable growth strategy and plan to ensure value is created for all stakeholders.  
  1. Future direction of the construction industry and ensuring you are neither selling nor buying the equivalent of a horseshoe manufacturer and installer in 1900.  
  1. Extremely low barriers to entry for new contractors can easily create competitors out of unaligned stakeholder groups, which often destroys value.  

9 Ownership Transition Issues Specific to Contractors
Continue building value in your business, yourself and your key team members with a good succession strategy....

9 Ownership Transition Issues Specific to Contractors
Continue building value in your business, yourself and your key team members with a good succession strategy....

Bill Walsh - Planning the First 25 Plays
Construction success depends on both the ability to rigorously plan as well as the ability to quickly react to changing field conditions. This is similar to sports and a lot can be learned from the disciplines of great coaches.
Integrated Systems
Poorly coordinated people, processes and technology become exponentially more inefficient as the business grows eroding profits, morale and customer satisfaction.
Root Cause Analysis to Behavior Level
Contracting businesses and projects always have problems. What’s important is that a team develops the skills and routine habit for continuously improving. When troubleshooting a problem it’s important to do Root Cause Analysis (RCA) down to behaviors.