Obliquity: Why Biz Owners Don’t Respond to Exit Solutions

Dr. John Kay in his excellent volume, “Obliquity: Why Our Goals Are Best Achieved Indirectly” provides numerous examples of situations where an indirect approach is best. A perfect example is the goal of creating wealth. Kay provides ample evidence to support his statement; “The richest men are not the most materialistic. Nor has it ever been otherwise”. Wealth in and of itself is never the goal of current or historical industry titans – instead great wealth creation comes about obliquely.

The oblique approach to challenges often comes to mind when we encounter advisors who want to help business owners with exiting their business. Each advisor comes to the challenge with a particular set of professional skills – be it legal, accounting, tax, wealth, or exit planning. Think of each skill set as the hammer. With hammer in hand the advisor then goes looking for the “nail” which inevitably is a business owner who “should” be exiting their business. Once identified the owner then has the “hammer” presented to them, with the expectation that the “nail” will respond and do as directed.

The result? Business owners do not respond as advisors expect and they don’t embrace the “hammer” solution. Our belief is that business owners are successful individuals who are, by their nature, complex. And, while unique in their individual complexity, successful owners share a particular set of psychological characteristics. As such, they often experience a sense of apathy, hesitancy, or confliction about their own exit. Thus, an advisor’s overt goals or statements are inadvertently at odds with the owner’s covert goals and motivations.

So what’s an advisor to do? We suggest an oblique approach meaning that the advisor should NOT start with their solution to getting the owner to exit.

  1. Get to know the story. Take time to learn a little about the business owner’s history. Why did they get into the business? What has been their greatest challenge? When was a moment they thought about walking away? What made them stay?
  2. Identify the heartbeat. As a result of taking time to listen with an exploratory ear advisor’s can work with the owner to discern what might be most important to them. It could be family legacy or expectations, future company success, a buyer who shares a strong set of values, or a particular valuation.
  3. Explore what’s next. Many business owners we speak with have spent very little time thinking of what comes next. Begin to ask questions that challenge life without the business.
  4. Reflect back. Many business owners have never had anyone ask them questions that cause them to reflect on their aspirations nor help them identify where their values may be in conflict with their transition goals.

Bo Burlingham in his insightful book – “Finish Big: How Great Entrepreneurs Exit Their Companies on Top”, describes this approach as exploratory in nature. Bo’s insight is that owners must engage in this exploratory work in order to successfully exit. He defines a successful exit as one that ends with the owner happy because they exit on their own terms, in their own timing, and get a valuation they are satisfied with.

With this oblique approach, business advisors create trust and understanding that can then serve as the basis for introducing the owner to whatever skill set the advisor brings to the equation. Such a process needs to be mindful of the communication style of the individual owner – which is in many cases fast paced and fact based – but this approach can be incorporated very readily into the regular interactions between advisor and owner.

A useful component to this process can be helping owners begin to understand just how ready or not they are for exit. Our proprietary online assessment gives both the advisor and the owner instant insights with just a few minutes of effort. See our assessment page for more details.