Issue 1 of 9: Strength of the Management Team

Construction Ownership Transition Issue 1 of 9: Strength and Alignment of the Management Team

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Beyond liquidation, nearly 100% of the value of a construction business is based on the post-transition management team's ability to continue profitably growing the business. 

Succession: Ownership Transition Issues - Number 1 Management Team. Nearly 100% of a Contractor's Valuation Beyond Liquidation Value is based on the post-transition management team's ability to continue profitably growing the business.

The exit strategy and deal structure will not materially improve the strength or alignment of the management team, though it could have a significant negative impact.

Those managers with 20-plus years of experience who have made most of the mistakes that can be made, learned their lessons, built the relationships, and still have significant professional runway left are in very short supply. This will continue to get worse over the next 10 years. 

Take a hard look at your management team and what they would look like after an ownership transition.  On a scale of 0-10:

What do you need to do to improve these scores?

What is it worth to improve these scores?


Succession
Continue building value in your business, yourself and your key team members with a good succession strategy....

Succession
Continue building value in your business, yourself and your key team members with a good succession strategy....

Levels of Integration and Optimization
Operational excellence must be a major component of every contractor’s strategy and baked into their daily behaviors. Optimizing each of the four major layers requires different levels of thinking, technology and time span.
Collections and Retention Trend Metric
Assuming that a contractor’s project team has done an effective job of aggressively billing the project, the biggest variable that remains for cash flow is the effectiveness of collections.
What Must Be True...
Asking the right strategic questions will ensure profitable growth in all economic conditions. Daily operational management is about adapting to what is currently true. Effective executive leadership creatively bridges the gap between the two.