By no design of our own, lately Design Kompany’s been consulting with consultants. DK does branding, and we’ve run into consultants who do strategic planning, operations and mergers. Sort of a consulting tripleheader.
Big picture stuff. Asking questions is the hallmark of the Design Kompany approach. So naturally by continuing to meet people who consult, we get to pick up newsy and informative bits from all kinds of smart people.
At a roundtable on Feb. 13 sponsored by the Greater Seattle Chamber of Commerce, the invited speaker Michael Weiss, managing director of
One of the things I took away from this meeting was this:
The value of a business isn’t its absolute dollar figure for a bottom line. The metric of evaluating a business’ worth is cashflow. The risk rate associated with the cashflow is what determines the company’s worth. –Michael Weiss, Alliance Equity
And what, specifically, are those indicators of cashflow risk? Things like: how good a condition are you keeping your books? How open are lines of communication between employees and staff? What are you doing to leverage assets, in other words, making the most gain from the least effort.
All of this reminded me of another entrepreneur’s seminar. That one was on choosing target markets, and a big part of making smart business decisions, we learned, has very little to do with numbers. It has to do with intuition.
“Some companies have all the language, saying ‘We’re a people company,’ and so on,” Weiss said. But when what’s called a post-merger integration period sets in, these same folks could do a 180. To avoid this, take people out socially. See how well you get along. Check the quality of their work. If things look good, do the deal, but give yourself trigger points where if somewhere down the road things don’t work out, you can always walk away.
Know Your Audience’s Psychographics | “Seamless Marketing” | Choosing Target Markets
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