The impact of an ownership change on your business can be positive or negative, depending on how you manage the transition. Employee performance may deteriorate as a result of uncertainty and fear of change. That’s why your exit strategy must consider the impact of a sale on employees.

Three Areas To Consider

1. Performance Management

An effective strategy identifies and implements needed management changes before considering a potential transaction. A strong managerial track record provides confidence to potential buyers or investors, and increases your business’s value. Think about the need to retain key management following the transition and whether you want to provide security for valued, long-term employees. The ownership change process offers an opportunity for you to reevaluate your business plan and to set new goals. In the process, you may identify ways to improve value by improving the skills of your employees.

2. Effective Communication

Effective communication is essential, and you must prepare a plan at the beginning of the process. It’s best to share knowledge with the smallest possible number of people. It avoids unnecessary or premature concern to other employees, and it’s easier to manage the consistency of the message to potential investors when working with a smaller group.

3. Identify Key Employees

Identify key employees you need to involve in the process. The people who are critical to preparing for a potential transaction are likely to be the same employees who are most responsible for your business’s success and the resulting value to the buyer. As the transaction progresses, communication needs will change, and a larger circle of employees may need to be involved in due diligence work. Still, knowledge should be limited to the smallest possible number of people.

Do one thing: Determine one way to engage employees to improve the value of your company.