Succession: Why People Matter More Than Profits and Contribute Significantly to Business Valuation
Joshua Fischer
Audit Director at Canady & Canady - #1 Texas CPA Firm for HOA Community Association Audit & Tax Services 14k+ Followers - Let's Grow! ??
In the contemporary business landscape, the allure of immediate profits can often overshadow the fundamental need to retain key personnel. However, seasoned business leaders understand that the real cornerstone of long-term success lies in cultivating and retaining top talent. Key personnel, with their deep expertise, institutional knowledge, and established relationships, drive innovation and operational excellence, thereby laying the foundation for sustained growth and competitive advantage.
Retention of a business' leadership team is intrinsically linked to organizational stability and performance. Employees who feel valued and engaged are more likely to exhibit loyalty, reducing turnover rates and associated costs. High turnover disrupts workflow, drains resources on recruitment and training, and can lead to a loss of critical knowledge. Conversely, a stable team of seasoned professionals ensures continuity, fosters a cohesive work environment, and enhances the company's ability to execute its strategic vision effectively.
Furthermore, key personnel play a pivotal role in fostering a culture of innovation. Their in-depth understanding of the industry, combined with their ability to mentor and inspire others, propels the organization forward. These individuals are often the driving force behind new ideas, process improvements, and the adoption of cutting-edge technologies. By investing in the development and retention of these employees, companies create a ripple effect that elevates overall organizational capabilities and adaptability.
There is a huge push toward offshoring, H-1B1 onshore workers, AI, temporary contract workers, and layoffs that all have a short term positive impact to reducing a businesses operating costs but at the expense of a businesses long term value. Share holders and private equity investors are looking for stability and predicable returns which require tenured professionals.
In conclusion, while immediate profits are undeniably crucial for short-term success, they should not come at the expense of retaining key personnel. The value that these individuals bring to a business transcends mere financial gains, impacting areas such as innovation, culture, and long-term sustainability. By prioritizing the retention of top talent, businesses are better positioned to navigate the complexities of the market, achieve enduring success, and build a legacy of excellence.
Department of Maritime Services at Town of Huntington, NY - team leader: seasonal employees. Marinas, boat ramps, and Pumpout crew.
3 天前Thank you for posting this. I’ve seen the short sighted thinking during layoffs and even have fallen victim to it in the past at previous employment. Experience and relationships are hard to replace. I’ve seen companies acquired and disposed of as if they were a used paper coffee cup. - product, lines, discontinued, etc. Positions are refilled later with people that have no understanding of how things work, the applications for the product and the relationships that created the market in the first place. Not just at companies that I worked for but at my customers and clients as well. Perhaps this is the “new “ way of doing things, but in reality, there is nothing new under the sun. Quoting from the book of Ecclesiastes. Stay positive, keep an open mind and your experience will be appreciated elsewhere.