The Importance of Legacy

Warren Buffet is a very successful business person. While I can’t say I always agree with his politics or policy leanings – you can’t argue with his wisdom. This year in his letter to stockholders he makes some important comments that we all should take as a cue for what to do. Check out page 26 of the PDF and read his two-page Memo to all Berkshire Managers. In this biennial memo, he reemphasizes his number 1 priority and asks for letters outlining who each manager has chosen to replace themselves if something happens to them. Here is the excerpt:

“I need your help in respect to the question of succession. I’m not looking for any of you to retire and I hope you all live to 100. (In Charlie’s case, 110.) But just in case you don’t, please send me a letter (at home if you wish) giving your recommendation as who should take over tomorrow if you should become incapacitated overnight. These letters will be seen by no one but me unless I’m no longer CEO, in which case my successor will need the information. Please summarize the strengths and weaknesses of your primary candidate as well as any possible alternates you may wish to include. Most of you have participated in this exercise in the past and others have offered your ideas verbally. However, it’s important to me to get a periodic update, and now that we have added so many businesses, I need to have your thoughts in writing rather than trying to carry them around in my memory. Of course, there are a few operations that are run by two or more of you – such as the Blumkins, the Merschmans, the pair at Applied Underwriters, etc. – and in these cases, just forget about this item. Your note can be short, informal, handwritten, etc. Just mark it “Personal for Warren.””

So what is the lesson? If Warren Buffet is concerned about succession planning – my advice is that we sure better be too. It is a key part of legacy planning. It is a key part of business continuity planning. It is central to planning in general. So many of us believe we are invincible. It will never happen to us. But it does, and I guarantee it will, so now is the time to put plans in place – on paper just like Warren says – so there is clarity about how things should proceed without you. That is legacy – what happens after you are no longer in the picture. Have you made those decisions? If so, have you written it down and actually shared it with anyone, particularly the one who is listed? Amazingly people will put guardians in their will to take care of their kids if something happens without ever telling the people they are listed. Now that would be a very rude awakening. But the same would be true for your business. You need a plan – you need it now – it is time to take this step.

I can’t encourage you enough to create your legacy plan today. It is one thing you can’t do after the fact. If you don’t do it – someone will do it for you. My suggestion is that a decision this important is something that you want to handle. Don’t leave it to chance or be late to the party.

Planning Matters

This is the second blog post regarding the 10 Things I Accidentally Learned on the Path to Growth and is a topic many of us as small business owners take for granted. After 25 years in this business, it has become more apparent than ever that planning is a key to success. Zig Ziglar says it this way: “Unless you have definite, precise, clearly set goals, you are not going to realize the maximum potential that lies within you”.


No Plan
I didn’t have a plan for many years. So my examples are more what not to do than what to do. I formed SCCI (now HTS) as a hobby back in 1985. It was just going to be a small sideline business to allow me to help a few folks with their computers.

• Today it is 7 locations across 5 states with 80+ employees that will do over 16M in revenue. It is a hobby that is way out of control.


• Our headquarters office in Harlan has had 5 additions since we began in 1985. So today we have 12,000 square feet attached to the side of our home on the farm in rural Iowa. Not exactly the best plan knowing what I know today.


• HTG was started back in 2000 as a small peer group for four Iowa companies. Today it has become an international group with 240 plus member companies from four countries around the world. Certainly was not what my original expectations were.

Do as I say, not as I did
I could list a few dozen or hundred more examples of how things have happened that were not planned. The ones above are all positive results - maybe not everything they could have been – but not a list of all of my failed planning which doesn't always turn out that way. A failure to plan has cost hundreds of thousands of dollars and caused a lot of pain and chaos. I admit it and can show you the battle scars from eBay sales of obsolete inventory because of no plan in how to control ordering, to business units that were totally unprofitable because they never had a business plan at all, to wasting hours and days of my life because it just happened to me without me taking control of my time with a plan. If you don’t plan, you will struggle to have success. It was back in the late 90’s when things began to unravel for us that I finally figured this out. During the last 10 years or more that planning has been part of our process, our growth and success has been completely different and positive. Planning does matter and it will for you too.

Four Plans
I think there are at least 4 areas you need to plan at a minimum:

• Company business plan – tells you where your company is going


• Leadership plan – tells you how you will lead your company to achieve their plan


• Life plan – tells you how you will balance life and work and achieve the things you say are most important to you


• Legacy plan – tells others what to do in the event your company or you are not able to continue status quo

I have written previously about each of these and you can follow the links to get more details.

Here is the way we see it in HTG - four plans - one we focus on each quarter - which provides a solid way to make sure we are getting things done.



Why don't we do it?

So why is it that most small businesses don’t plan? Here is a list of some of the common excuses I hear from folks. There really are no good reasons, but we convince ourselves these things:

• Planning is hard work and takes time


• Planning never ends


• Planning requires communication


• Planning requires introspection


• Planning requires follow-up and measurement


• Planning requires us to be honest with ourselves


• Planning is bigger than me, myself and I

Hand in hand

Planning goes hand in hand with strategy. You need strategy to give you the “why” to what you are going to work on. But planning takes strategy and tells us the “how, when, what, where, and who” to achieve that strategy. It is important that we take time to plan. It is critical for us to truly grow our company and move toward success. Time to stop making excuses and step up to lead. That means you take time to involve your team, stakeholders and anyone else that should be included – and you just get it done. If you don’t have a plan, you are planning to fail. Don’t let that happen. Get down to business, take the time, invest the energy, and put plans down on paper. It will make a huge difference in your outcome!

Roundtables4Roundtables Part IV

So let’s tackle some of these common issues that most small businesses face today. Let’s cut to the core and admit that unless the business works for us – all we really have is a job. Let’s admit that if things don’t go on when we are away – if we are tied to the pda or phone or email when we are supposed to be coaching soccer for our kids or have our family away on vacation – or even worse can’t remember the last time we were on vacation – let’s admit all we have done is put lipstick on a job and really don’t have a business at all. So that is step one. Evaluate whether or not you really have a business at all. There is nothing wrong with having a reliable job that provides for your needs by the way. Just don’t call it something it isn’t. Let’s get our terms straight. If you have a business – it is not dependent on you to proceed and operate. If you have a business – you can get away and have a life. If you have a business – it is not about YOU.

OK – so those who are left with me – let’s address the first issue that I see most business owners have failed to tackle. The “WHY” of their business. So many businesses today focus on the who, what, when, where, how – but they totally skip the why. WHY is the reason your business exists in the first place? It is where your passion comes from. And by the way, if you aren’t passionate about your business, if you can’t wait to get started each day, you probably have a job. Why did you create this business? What is the PURPOSE it was designed to serve? What do you want to accomplish through it? Do you know the “why”? Answering that question is a key part of writing a business plan. It is core to the motivation for everything else that will happen as part of running your business. It IS the key to success and happiness. Without the “why” you can’t possibly know where you are going or how you will get there. You are directionless and wandering in the wilderness. So make sure you know the “why”.

Do you need a business plan? The short answer is yes. You need it for a few reasons:

1. It is the basis to hold an owner accountable. You run your business because you want to be your own boss. That is good in some ways but very bad in others. You need to be accountable and a business plan is part of it.

2. If you participate in any kind of peer group – your group members have to have it. Without your business plan they can’t really give you any meaningful guidance because they have no idea where you are headed.

3. Your employees need it as well. They are on the journey with you. They can’t really do their job until they know what the destination is. The business plan is not about you. It is about the business and the “us” that make it up.

4. Your family should know so they can understand what it will take for you to succeed. That also should give them some opportunity to provide feedback on just how often you will be gone and miss important family activities and events.

5. Your banker should care. Unfortunately many never ask for it – but you should offer to share it and set yourself apart from the majority of small businesses by doing so. And if you don’t have a banking relationship – get one. It is far easier to ask for money when you don’t need it than when you do.

6. Your vendors should care too. Part of your business plan should include key vendor relationships and how that will look in the next 12 months. You may write an individual plan with key vendors – but I suggest you include some parts of it in your overall business plan.

One key reason to know “why” is that it is essential to have any hope of achieving life-work balance. Without the “why” there is likely nothing that will keep you from working all your waking hours in your business except pure exhaustion. The “why” needs to also address your life. It is a key component of writing a life plan. You have to know what the purpose of your life is. Why do you get up each morning? What is it that you want to accomplish through living? Not through your business – but as a result of living your 168 hours this week? Do you know those answers? Have you thought about it? Once you put it on paper and share it with peers or even your spouse – someone can begin to hold you accountable to make sure your actions match your goals. Without accountability life will always lose to business. We are wired that way as entrepreneurial business owners. We can’t afford to let life lose. It has to be top priority.

Life-work balance involves a lot of areas. That is why HTG uses a life planning document to help give some direction on areas you should consider. There is so much to ponder and it is the important stuff. Business is so fleeting. Life is so eternal. Life matters and how we live it matters a lot. No one will wish on their deathbed that they had spent more time in the office. Many will say they missed far too much life by spending too much time working in their business. You can’t change it at that time. The change has to happen now and it can’t be postponed. Do you have it balanced?

An Upcoming Live Meeting Opportunity

Arlin Sorensen, CEO and founder of Heartland Technology Solutions and HTG peer groups, will be hosting a live meeting on March 24th for Microsoft as part of the 5W25 series on four plans to provide a well rounded look at life and business.

The plans we will discuss are:
- Business plan
- Leadership plan
- Life plan
- Legacy plan

Joining for the live meeting will be Jamison West from JWCS and Brad Schow from Compudyne. The event is code WES36PAL and it will be held at 9:00 AM Pacific that day. The session is titled Four Plans That Can Change Everything and that is exactly the potential outcome from the session.

If you learn to use these plans, you can change the result of your life and business. Without planning, you leave things up to chance and quite honestly have far less opportunity to achieve your dreams or succeed. We often spend a lot of time focused on our business plan but neglect the things that may be more important. Never forget your life will leave a record, a history and a legacy. Planning can help make sure those turn out as you would like.

Invest an hour and join me for this webcast. To register go to www.mssmallbiz.com/training and select the appropriate session. There are many other great sessions available as well. Hope to meet with you online that day!

The End of a Decade

Another year is ending but this is a rather important end of the year as it also is the end of a decade. Hard to believe we are already finishing the first ten years of the 21st century. It seems like Y2K days were only a short time ago, but here we are ready to enter the next decade. But before we go, it is time to stop and take advantage of the two opportunities that transition brings.

First we need to review the past year and evaluate our performance. I would also say we should take a little extra time and review the past decade. That will be challenging if you are anything like me and can hardly remember what you did last hour let alone over the course of the last 10 years. But looking back gives us so much perspective from which we can then look forward. We can learn much from that exercise. It can be a significant help in putting together a course of change, an opportunity to tweak things just a bit, or a validation that we should continue doing what we did this year into next year.

Here are some potential questions to ask:

What big things happened? Did they happen because you made a knowing, concerted effort to make them happen? Or... did they just happen?
What good things happened?
What bad things happened?
What was your biggest triumph?
What was the smartest decision you made?
What one word best sums up and describes your experience?
What was the greatest lesson you learned?
What was the most powerful service you performed?
What is your biggest piece of unfinished business?
What are you most happy about completing?
Who were the three people that had the greatest impact on your life?
What was the biggest risk you took?
What was the biggest surprise?
What important relationship improved the most?
What else do you need to do or say to be complete?
What lessons did you learn from these things?

Our second opportunity is to create a course for the new year. We get a fresh start, a chance to begin all over again. It is sort of like a new game. The buzzer has sounded on the last one, and now we can take the field again and start from scratch. I know it isn't quite that cut and dried, but you get my drift. It is a chance to make a difference in our direction and ultimately our success.

Consider these questions about the coming year:

Do you want to have more time?
Do you want to go places? With who? In what fashion?
Do you want to read more?
Do you want to learn new skills?
Do you want to spend more time with certain people?
Do you want to run a race? Climb a mountain? Learn a new language?
What kind of person do you want to be?
Who do you want to meet?
How much money do you want to be able to give away?
What would you like to be your biggest triumph?
What advice would you like to give yourself?
What is the major effort you are planning to improve your financial results?
What would you be most happy about completing?
What major indulgence are you willing to experience?
What would you most like to change about yourself?
What are you looking forward to learning?
What do you think your biggest risk will be?
What is one as yet undeveloped talent you are willing to explore?
What brings you the most joy and how are you going to do or have more of that?
Who or what, other than yourself, are you most committed to loving and serving?
What one word would you like to have as your theme?

The key is to stop long enough to do some meaningful reflection and review of how the year really was in 2009. Did you achieve your goals? Did you accomplish all you had intended? If not, what were the blockers? Put down on paper your evaluation - you won't remember it if you don't. And put down on paper your plan for next year. Share it with your spouse, your employees and others that need to be part of holding you accountable. It likely won't be accomplished if you don't share it broadly for accountabilty.

One of the most valuable things we can get from the past is lessons we learn, often the hard way. But if we don't record them we often have to learn them over and over and there is no sense in that. Once should be enough for any of us to learn hard lessons. So create a place to store those year end evaluations and reflections and review the learnings often. If you had a business plan for the year - that is the place to start. Which things were you successful with and which came up a bit short. That is important as you chart the course for the new year. If you had a leadership or life plan, you need to do the same with those. Make sure you evaluate how you did in comparison to the goals you set and note what you learned. Have the blockers been removed yet or do you need to find a way around them? There is so much you can learn by just stopping and evaluating.

And ultimately the question is how did last year impact my legacy plan? Was I intentional in what I did? Did I make any progress toward that what I want to leave behind? Legacy happens whether we plan it and work toward a plan or not. The question really is - do you want to control what your legacy looks like or are you content to just let it happen and not care the result? I believe we need to do a lot better job of being intentional about legacy and what we will leave behind for those that will follow.

You have an opportunity to chart a new year ahead. But before you do, make sure you stop and learn all you can from the past. We should never dwell on where we have been. But we certainly should not ignore the value of what we can learn from that either. I wish you blessing and success in 2010! Much of that happens is based on how well you prepare and plan. Then it comes down to EXECUTION!

Making the Handoff - Passing the Torch

At the ConnectWise Partner Summit next Thursday at 3PM I will deliver a session around succession planning and begin to navigate the many options and decisions that need to be addressed in order to plan for the future of your company. This is a journey filled with landmines and many roads to follow. It is not simple, and left undone, will be handled by the government and other disinterested parties in your wishes.


It doesn't matter what you want to do - sell, give it away, put employees in an ESOP or any of a dozen other options - if you never plan for it there is no way to assure it happens your way. Don't miss the chance to create the legacy you desire. This session will ask lots of questions most have never really considered. It will cause you to think deeply about your future and make you squirm in your seat. But it is such an essential part of making the transition smooth and your company sustainable and valuable.


Do you have your next set of leaders idenfied? Have you began the process of mentoring and training the folks you hope will step up and take over? Have you figured out how you will get your money out of the company someday? How about your employees - have you identified a way to keep them employed and cared for? So many questions and thing to consider. It is enough to drive you crazy.


Join me at 3Pm on Thursday in the Senate and Gallery room during the ConnectWise Partner Summit to dive into this topic in depth. I can't promise all the answers, as we are walking this journey ourselves right now. But as part of that process there are lots of questions we have had to address and many more still on the horizon. We'll talk about all those things and leave you with some things to go think through so your legacy can continue long past your working days.

Are You Ready?

Nancy and I spent some time this weekend visiting a good friend who was involved in a very serious automobile accident on July 1. He was going home for lunch driving the same road he had a thousand times before. That day, at an intersection that he had crossed so many times before, he missed seeing a vehicle coming from the right and pulled out in front of it. T-boned in the passenger side. Since it was a short trip he had failed to put his seatbelt on, so the crash threw him violently around the vehicle and he suffered significant brain damage among other issues. He lay in a coma for a couple months, but has now come back with some understanding but is months or years from a full recovery, if it ever happens.

So what is the moral of the story? We never think it will happen to us. When I suffered my quad bypass surgery at age 49, I certainly did not expect it to happen to me. But bad things happen to people every day. And if you think it won't happen to you, look out. The moral of the story is that we all need to get some plans in place so we are ready for whatever life throws at us. As business owners, it is one thing for us to choose not to prepare for the future. But we need to realize that decision impacts our staff, customers, family and a whole lot of people that would all prefer that we spend the time and energy to think through the potential and have a plan in place. In fact, it probably is the most important area we will ever address for our family and business.

That is why we are focusing on a legacy plan for HTG in Q4. Life is important, and the outcome of that life when we are no longer around is our legacy. We all have ideas of what we hope our life will do in terms of long term impact. But if we don't plan for it, if we don't tell people and write it down, then our legacy will be left to the courts and government and that is not going to turn out anywhere close to what we may want. No one wants to face the reality that life is short and will end. No one wants to admit that they are a heartbeat away from a medical issue that could take them out of their business short or long term. But it can happen - it does every day - and we need to face it and deal with it proactively, just like we preach to our clients. It is part of disaster recovery and business continuity. What happens to your business, family and legacy if something happens to you?

I will be sharing about this topic with several presentations at the upcoming HTG and ConnectWise Partner Summit events. We need to prepare and be ready for whatever life throws at us. It is a lot of work, takes a lot of communication and effort, but it is the only way to assure that your legacy will turn out the way you want it to be. Now is the time. Plan to join my sessions and find out key techniques to really be ready for life!

The HTG Way Part VI - Legacy Plan

Richard Bach said “There's no disaster that can't become a blessing, and no blessing that can't become a disaster.” While this is a true statement, unexpected and unplanned for disasters can certainly cause a lot of stress and uncertainty. So the fourth plan HTG requires members to address relates to how business, leadership and life will continue in our absence. Some call it a legacy plan.

A key component of the legacy plan is related to disaster recovery and business continuity. This plan needs to address all three of the prior areas we discussed. For example – what happens to the company if you get hit by the proverbial bus? What happens to the areas of leadership you are responsible for? What happens to your spouse, family, civic organizations and other areas you currently are involved? All those questions need to be addressed so there is no drop off in the event of a disaster, be it short term or permanent. One thing we can all be sure of, life on this earth will come to an end. We do not know when, but we do know that it will. So we need to prepare so we are ready whenever that time comes.

But legacy is much more than just disaster recovery. It addresses the impact of a person’s life after they are gone. How do you keep a tangible presence beyond your actual lifespan? It is what happens after you die. While physical assets may be deemed a component of a person's ultimate legacy, the focus on family or institutional history, values and the stories that define us dictates that every individual, family and entity can be enriched through implementing a strategic legacy plan.

So what are the key components to a legacy plan?

1. Personal mission statement – a series of guiding principles that lead you through daily and major life decisions. This answers the question “How will you live?”
2. Personal legacy statement – allows you to articulate what is closest to your heart. It is a record of messages and information too valuable to be lost and captures your inner most thoughts for the benefit of future generations. This answers the question “What will the result and impact of my life be after I am gone?”
3. If something happens to me – a collection of key information that makes recovery from a short or long term illness or death much simpler for those left behind.
4. Exit Planning Guide – key information to make the funeral planning process go smoothly.
5. Estate and Will Planning Template – key information to help in the creation and review of your will.

These are simply some tools to use to put together a systematic plan to be sure that you have at least started the process of putting a legacy plan in place that prepares your company, leadership and life for a change in your status. Without proper preparation, you put all things at risk and make the situation much more difficult and complex than it needs to be. No one really enjoys this process, but it is so very important to consider prior to being needed. It is often not possible to address these areas once illness or death has occurred. So take the time now, record the needed information, and make sure those important in your life are informed of the location of the documents.