Fact 2.1: An exit strategy and deal structure that does not require a strong management team post-deal to generate the business results is a unicorn tied to that pot of gold at the end of a rainbow. It might exist, but planning on it is like having a retirement plan based on winning the lottery.
Fact 2.2: There are zero shortcuts to developing a strong management team, including a clear leader to run the business post-deal. Only leadership, deliberate execution, and time will create that.
With that said, it is incredibly important that the exit strategy and structure of the deal maintains and enhances the alignment and drive of the management team. The market for talent at the management level is incredibly tight and will continue to worsen through 2030. Even with the right talent in lace, it takes years to create the alignment and competencies to effectively run a contracting business. This makes proven management teams a major stakeholder group in ownership transitions.
Successful Strategies Applicable to any Contractor:
- Owner: Focus a significant amount of resources on developing a management team that can effectively run the business, gradually developing competencies over time. Continually give them additional responsibilities to test and stretch their capabilities.
- Management Team Member: Work relentlessly every day to build your own competencies. Take deliberate actions to align yourself with the owner and other members of the team so that working together feels like a high-performance sports team. Continually stretch yourself in the responsibilities you take on.