3 key objectives for developing your ICT business’ operational team
Developing effective operational teams is key to maximising the value that a buyer will pay for your business - ICT, Engineering, SaaS - whatever your industry, this is always the case.
Assuming that you are planning to leave the business when you sell, any buyer will look for a strong 2nd tier management structure which they can rely on so the business can continue as normal after purchase.
Great operational teams include the leaders within your business who have a strategic role and guide the organisation to achieve its vision, mission, and strategies alongside you.
To ensure your operational team is as prepared and "buyer ready" as possible, we've put these 3 key objectives together for you:
1 - Make sure the business functions without you
This is really important. A good buyer is looking for an investment, not a job, and a general manager to replace you will cost money. Ensure that day to day issues are not down to you to resolve. The more time you spend in day to day activities in the business, the less value it represents to the buyer.
Before you start making any changes, identify the gaps in your management and assess what skills and experience you need, then recruit or promote a suitable successor and put a management structure in place.
The ideal situation is that all the buyer needs to do is bring strategic direction and resources for further growth. Of course they will also look for synergies, but the day to day activities and relationships should be able to continue without you.
To get to this point, consider implementing cross-functional training programs. These programs ensure that multiple team members are capable of handling various aspects of the business. This not only reduces the reliance on any single individual but also creates a more versatile and resilient team.
Additionally, establish regular review meetings where team members can report on their progress and challenges in managing their responsibilities. This encourages a culture of accountability and continuous improvement, key attributes that a prospective buyer will find appealing.
2 - Pass on your "technical expertise" to the business
Consider how a new owner - let's say a trade buyer that has strong technical expertise in the ICT sector - will take over the management of your clients.
Your organisation needs to know and understand the technical solutions and processes that have been recommended to clients and have a team of client facing technical systems managers in place.
To achieve this, consider establishing a formal mentoring or coaching program where your expertise is systematically passed down to key team members. This could involve regular training sessions, shadowing opportunities, and hands-on projects that allow your team to apply the learned skills in real-world scenarios.
This approach not only equips your team with vital technical knowledge but also fosters a culture of learning and adaptation.
It will also pay to develop a "hand-over" plan to transfer the business relationships to the buyer in an ordered way that will not disrupt your clients and cause them to consider other suppliers.
For larger ICT businesses, by opening up the availability of your business to buyers that are not necessarily active in the ICT sector, for example private equity firms, you will widen the circle of prospective buyers and improve your negotiating position.
3 - Ensure your business has suitable accreditations and company policies
Accreditations and company policies, such as Microsoft/VMWare/Citrix partner status, ISO quality certification, health and safety, personnel and training policies, not only add credibility to the ongoing stability of your business, they demonstrate that the right systems are in place to manage the business without the owner.
Note: It would probably be worth regularly auditing these systems to ensure compliance and relevancy.
Keeping your accreditations up-to-date and your policies in line with the latest industry and legal standards shows a commitment to excellence and due diligence.
It’s also beneficial to document all your processes and policies clearly. This not only aids in maintaining operational consistency but also provides a valuable asset for buyers, who can more easily assess the quality and organisation of your business.
Remember that effective delegation will also strengthen your leadership team. During your time in the business, the more you can delegate to your operational team, the stronger and more reliable they will become - and the more attractive your business will be to potential buyers. Get used to sharing your responsibilities and trusting your team, it will help both you and the sale of your business.
The hardest part of developing your team can be knowing where to begin. So, start by understanding your team's developmental needs, review and update their job descriptions, talk to them, and watch them working.
Ask questions and find out where the skills gaps are in your team, or who are the most suitable people to take a task or some projects away from you. By getting a competent operational team set up will make your business look far more attractive to potential investors, and ensure it won't miss a beat without you at the helm.
To further support the development of your team, you could also invest in leadership development programs. These programs can help emerging leaders within your team to hone their managerial skills, understand strategic thinking, and foster a sense of ownership over their roles.
Such investment in your team’s growth not only improves the operational effectiveness of your business but also signals to potential buyers that the business has a capable and future-ready leadership team.
This article originally appeared as part of our series of e-Tutorials for the Sale of IT Support & Telecoms Companies.
We hope the article has been useful. If you have any questions about anything we've shared above, or you're looking for more advice on how you can make your operational teams "buyer ready", then we've got plenty of experience to share with you. Simply get in touch using the contact form below or give us a call on +44 (0) 20 8090 9380.