Brooke Chase

By Lori Moen, CEPA Business Coach | Catalyst Group ECR

The legacy you leave behind when you’re no longer part of leadership isn’t just about your accomplishments and accolades. It has to do with how you approach any and all issues that fall in front of you. In the modern business world, leadership legacy is all about moving towards sustainable success.

It’s important that companies begin thinking beyond their short-term goals and toward the long-term impact of those who are in leadership. There is a lot of value in investing in each moment and considering the consequences your decisions will have both in the present moment and in the future.

Let’s take a look at a few leadership legacy examples to inspire you as you plan your future.

Leadership Legacy Examples: Graham and Schultz

When looking back at successful business leaders, there are a lot of people who rose above expectations, allowing them to leave their mark on the organization.

Take, for instance, Katharine Graham, who took the helm of The Washington Post in 1972 and became the first woman named CEO of a Fortune 500 company.

After breaking through the glass ceiling, Graham went on to fight relentlessly for the Constitutional right to free press after she was slapped with a restraining order for her attempts to publish The Pentagon Papers. Her efforts led to a Supreme Court decision that “defended the First Amendment right of free press against prior restraint by the government,” and reaffirmed one of the nation’s most fundamental values.

Another leader who’s left a lasting legacy is Howard Schultz. As the former CEO of Starbucks, he’s left a legacy that’s had an impact greater than just the delicious coffee. His legacy has impacted all of those who make the coffee and those who work in their stores. Schultz made it a point to prioritize the well-being of his employees by offering comprehensive healthcare benefits and supporting various communities.

One of the ways he did this was through expanding educational access through the Starbucks College Achievement Plan. This program provided a tuition-free college education online and hired thousands of military veterans and spouses, as well as refugees and underprivileged youth, allowing people to create a better life for themselves and loved ones. He chose a legacy that gave opportunities to those around him, and as a result, he built a successful company that fostered the professional growth of its employees.

By The Acquira Team

Loose lips sink ships. The same can be true when selling your business.
If word gets out to your employees, customers, or vendors prematurely that you’re selling – it could have a dramatic impact, possibly jeopardizing how much you can get for all your hard work.

Breaches in confidentiality can lead to several adverse outcomes, such as destabilizing employee morale, alerting competitors, unsettling customers, and potentially devaluing the business before the sale is finalized.

Your employees may fear for their job security and start looking for new positions, which can lead to a loss of key staff. Similarly, customers and suppliers may perceive the sale as an indicator of instability, prompting them to seek alternatives.

Here’s a look at the importance of confidentiality during the sale of your business.

Breaches in confidentiality can lead to several adverse outcomes, such as destabilizing employee morale, alerting competitors, unsettling customers, and potentially devaluing the business before the sale is finalized.Protecting Business Interests.

Non-Disclosure Agreement (NDA).

Sensitive information, including financial statements, customer lists, proprietary processes, and strategic plans, must be protected during the sale process.

The inadvertent disclosure of such data can compromise the competitive edge of your business and, by extension, its market value. 

Strategies for safeguarding this information include secure document management systems that track and control access to sensitive documents and ensuring that all digital communications are encrypted.

Potential buyers should be required to sign an NDA before receiving any sensitive information.

This legal document ensures that the information shared during the due diligence process cannot be used for any purpose other than evaluating the purchase of the business.

Preserving Employee Morale

The uncertainty generated by the sale of a business can significantly impact employee morale and productivity.

Rumors of a sale can create anxiety among the workforce, leading to decreased productivity and potentially prompting key employees to leave. 

To manage this, communication should be carefully planned.

While it’s important to maintain confidentiality, finding the right time to inform employees about the sale is crucial.

This decision requires a delicate balance between preserving the integrity of the sale process and respecting the rights of employees. It’s ultimately up to your discretion but as a general rule, making sure the news comes from you – and not the buyer – is preferred.

Your management team plays a crucial role in mitigating the impact of sale-related uncertainty on employee morale.

By maintaining normal operations and showing confidence in the future, leaders can reassure employees.

In cases where confidentiality is maintained until the sale is finalized, preparing a comprehensive plan to manage the announcement to employees is vital.

This includes addressing their concerns, outlining any changes they can expect, and highlighting the opportunities the sale presents for the business and its workforce.

Sustaining Customer Relationships

Breaches in confidentiality during the sale of a business can severely impact customer trust, a cornerstone of any business’s success.

Customers who learn of a sale through unofficial channels might fear disruptions in service or changes in product quality, leading to lost confidence and business. 

To mitigate these risks, maintaining open yet carefully managed communication with customers is crucial.

Strategies include segmenting customer communications to ensure messages are tailored and relevant, and proactively addressing any concerns they may have about the sale’s impact on their service.

Ensuring business continuity is key; customers need reassurance that the quality and reliability of what they’ve come to expect will remain unchanged.

Best Practices for Confidentiality During the Sale Process.

Establishing clear protocols for handling confidential information is essential to maintaining confidentiality.

This includes training employees on the importance of discretion and the potential consequences of leaks.

Within the organization, fostering a culture of open communication and transparency helps manage rumors and misinformation.

By being transparent about the processes in place to protect the businesses and stakeholders’ interests without divulging sensitive details, employees can feel more secure and less inclined to speculate or spread rumors.

Data rooms

Data rooms serve as secure platforms where documents can be viewed but not easily removed or copied, reducing the risk of leaks.

These digital rooms allow for selective disclosure, where information is only available to parties directly involved in the transaction and whose intent and legitimacy have been vetted.

The use of data rooms facilitates the organization and tracking of document access, ensuring that sensitive information is not broadly disseminated and is only seen by those with a legitimate need to know.

Selective disclosure emphasizes the importance of sharing information on a need-to-know basis.

This approach minimizes the risk of confidentiality breaches by limiting the number of people aware of the sale and the details of the transaction.

By carefully managing who receives what information and when, sellers can protect the integrity of the sale process and the business’s value.

Pre-Sale Confidentiality Planning

Before initiating the sale process of a small business, you should establish a robust confidentiality plan.

This serves as a foundational step in protecting the business’s sensitive information, including financial records, client lists, proprietary technologies, and strategic plans.

Identifying what constitutes confidential information early on prevents inadvertent disclosures that could jeopardize the sale or the business’s competitive edge.

Equally important is determining who needs to know about the impending sale. 

Limiting this knowledge to a select group of individuals minimizes the risk of leaks and ensures that the information is only shared with those who have a direct role in facilitating the sale.

This selective sharing is crucial for maintaining an environment of trust and security, laying the groundwork for a smooth and discreet sale process.

Role of Intermediaries in Maintaining Confidentiality

Intermediaries, such as brokers, advisors, and legal representatives, play a pivotal role in maintaining confidentiality during the sale of a business.

These professionals act as buffers between the seller and potential buyers, ensuring that sensitive information is only shared under strict confidentiality agreements and after vetting the seriousness and capability of the interested parties.

The choice of intermediaries is significant; opt for those with a strong track record of discretion and expertise in handling confidential transactions.

Experienced intermediaries understand the stakes involved and are skilled in crafting communication and information-sharing strategies that protect your interests. 

By managing the flow of information and negotiating on the seller’s behalf, these professionals help preserve the integrity of the sale process, ensuring that confidentiality is maintained from the initial stages through to the conclusion of the sale.

Confidential Business Sale: Monitoring and Enforcement

Monitoring compliance with confidentiality agreements is essential to safeguard the sensitive information involved in the sale of a business.

Employing systematic methods to track adherence and regularly auditing the handling of confidential data ensures that all parties involved are complying with agreed-upon measures.

This might involve periodic checks on how data is accessed and shared within data rooms, reviewing access logs, and confirming that information is not being disclosed improperly.

Conducting regular audits of confidentiality measures involves assessing the security of document storage, both physical and digital, verifying that only authorized individuals have access to sensitive information, and ensuring that all electronic communications are secure.

These audits help identify any potential vulnerabilities or breaches in confidentiality protocols early, allowing for timely corrective actions.

The consequences for breaches of confidentiality should be clearly outlined in the confidentiality agreement and can include legal action, financial penalties, and termination of the sale process.

Enforcement mechanisms are crucial as they underscore the seriousness of the agreement and the commitment to protecting the business’s confidential information.

These measures serve as a deterrent against unauthorized disclosure and provide a clear recourse for the selling party should a breach occur.

Conclusion

Remaining confidential during the business sales process is critical to safeguarding its value and stability.

Breaches in confidentiality can destabilize employee morale, alert competitors, unsettle customers, and potentially devalue the business. 

Protecting sensitive information through robust confidentiality agreements, secure document management, and controlled information disclosure is essential.

Industry Trends – IWF, By Warren Shoulberg

It may not be back to the good times during low interest rates but Telsey Advisory Group’s Housing Scorecard shows more positives than negatives.

If you’re looking for good news about the housing market – especially when there doesn’t seem to be too much as the most recent data suggests the sector remains weak and mortgage rates are even going back up a bit – a new analysis from prestigious Wall Street firm Telsey Advisory Group is going to bring a smile to your face…and to your business bottom line too.

In its regular “TAG Housing Scorecard” which ranks a number of factors influencing the industry, Telsey sees five positives, three even scores, and just two negatives. “Our latest Housing Scorecard reflects a housing market that has bottomed out and is improving,” it wrote in its latest report. “The latest data have resulted in our total index rising to 65 from 35 in October 2023, August 2023, February 2023, and December 2022, 50 in July 2022, and 55 in February 2022.”

That’s still down from its index of 80 in April 2021, but “better than 2022 and 2023.” Still, it said the market is “not back to strength.”

Positives on its scorecards were: private fixed residential investments, the value of construction put into place, the S&P/Schiller Home Price Index, new construction starts and permits and housing formations. On the negative side were 30-year fixed mortgage rates and existing house sales. It judged remodeling rates, employment and consumer confidence as “mixed.”

It continued to see those retailers and other businesses that service the housing market as long-term solid prospects even if right now they remain challenged.

by Alicia Esposito – Small Business Exchange

The Federal Trade Commission (FTC) has issued a final rule that bans non-compete clauses nationwide for all workers, including senior executives. FTC Chair Lina M. Khan describes the move as a stride towards bolstering competition and freeing workers to pursue new career opportunities and participate in healthy business competition.

“Non-compete clauses keep wages low, suppress new ideas, and rob the American economy of dynamism, including from the more than 8,500 new startups that would be created a year once non-competes are banned,” Khan said in a statement. “The FTC’s final rule to ban non-competes will ensure Americans have the freedom to pursue a new job, start a new business, or bring a new idea to market.”

Existing non-competes with workers other than senior executives are not enforceable after the effective date, which is 120 days after Federal Register publication. However, (for) senior executives, which are defined as workers earning more than $151,164 who are in “policy-making positions,” (existing non-competes can remain in force), The FTC estimates that these executives account for less than 0.75% of U.S. workers. (Click here to read the rule in its entirety.)

Implications for Small Business Owners and People Managers

Non-competes have been a standard for many organizations, especially in media and tech. However, non-competes can have rippling effects for workers in all industries, preventing them from tapping their expertise and bringing new, innovative ideas for market. The FTC outlined how the new rule will impact all businesses, however, the data points to significant value for small businesses and startups in particular:

• Boost in Innovation: The FTC estimates that an additional 17,000 to 29,000 patents will be filed annually under the new rule. Small businesses and startups will get to benefit from  a richer ecosystem of ideas and inventions.

• Increase in Startups: The FTC projects a 2.7% increase in new business formation, which is equivalent to more than 8,500 new companies annually. Entrepreneurs previously restrained by non-compete agreements can now venture into new businesses without legal hindrances, creating a more dynamic business landscape.

2. Economic Growth: Without non-competes, workers are expected to earn an additional $524 yearly. This increase in disposable income could boost consumer spending, indirectly benefiting businesses across sectors.

3. Competitive Hiring: Small businesses need top talent (which significant experience) in order to grow and thrive. However, they often lose out to large corporations with strict non-compete agreements. The new rule levels the playing field, allowing smaller firms to attract and retain skilled workers by focusing on competitive wages, better working conditions, and opportunities for growth, according to the FTC.

Reactions and Preparations

The FTC initially proposed the Non-Compete Clause Rule on Jan 19, 2023. Since then, the commission has conducted extensive research on how non-competes impact competition and collected more than 26,000 public comments. The response from the public was astounding, garnering more than 25,000 comments in support of the proposed ban.

With non-competes off the table, the FTC recommends that companies lean into alternative legal protections such as trade secret laws and non-disclosure agreements (NDAs), practices already employed by 95+% of workers with previously enforced non-competes.

For small business owners, founders, and leaders, the removal of non-compete agreements is poised to create new avenues for growth, innovation, and competition. It encourages a business landscape where success is determined by the ability to attract, develop, and retain talent through merit and differentiated benefits rather than restrictive legal agreements.