Do you know the hidden assets in your business?
Knowing the assets and liabilities of your business is important. Some hidden assets do not appear on the balance sheet in the valuation of your business.
As a leader, I am sure you know what your Assets and Liabilities are. You know, the component parts of your Balance Sheet that you leverage to create the Revenues and then Profits on your Income Statement.
Sure, you know what those are. However, what about your hidden assets, do you know what they are?
Typically what I find is that the honest answer is most often “what do you mean by hidden assets?”. So, what do I mean by hidden assets?
What are Hidden Assets?
To start with they are, by their nature, not readily visible. They certainly don’t appear on the Balance Sheet and they may be difficult to measure, yet they are very real and, in terms of the valuation of your business, they may represent real untapped future potential.
What has me reminded of and so speaking of this today?
Well, a client was recently talking about their global team and said:
“People want to grow with the business as the business grows”
As Dan Pink famously noted, beyond a baseline of earning income to meet their needs, people are motivated by three things (follow this link to a post where you can watch the tremendous video by RSA Animate of his TED Talk), Purpose, Mastery, Autonomy.
So, what my client meant, in other words, was that people don’t want to be cogs in the machine.
They want to know why they are doing what they do (“Purpose”, so be clear on the purpose of your company so they can connect it to their own), they want to always be learning new skills (“Mastery”) and, last, they want to feel they have some freedom and agency over their work and also the impact they can make.
So, my client’s thoughts and words got me thinking about Hidden Assets
Hidden Assets and Business Valuation
Back in my days of assessing businesses to invest in or buy, over time I developed a bit of a knack for seeing the hidden assets in a business.
When I could see hidden assets that the owners and leaders of a business did not or could not see, then I could often buy or buy into that business for less than I knew it had the potential to be worth by leveraging those hidden assets.
What types of hidden assets are there?
I could talk for days about the missed opportunities I’ve seen because business leaders are too busy hitting operational numbers to see their hidden assets.
Sometimes they are things they do brilliantly that they simply haven’t focussed on as something they could leverage to do more of and to sell to others who value it.
Sometimes it can be a behavioural attribute such as curiosity combined with the ability to innovate, yet they are so focussed on their core business to hit the numbers that they don’t invest in leveraging that either.
Today, though, let me touch on a hidden asset that I see missed to some degree in every business I have ever talked to or worked with.
People as Hidden Assets
No matter how well you think you are supporting your people to make the most of themselves through being part of your team, you could do more.
In many cases I’ve seen, leaders and businesses could do SO much more to leverage their people.
Again I could talk for days about this, but for today let me simply make one suggestion.
To flip the quote from Churchill:
Ask not what your people can do for your business,
ask what your business can do for your people.
So, back to the hidden assets in your People.
Focus as much as you can on the above and you will have people who are aligned, engaged, enthusiastic, motivated. So far, so good.. and so obvious, right?
Well, what about digging further to unearth what more can be hidden in that rich vein that your people represent.
What if, with them aligned and engaged, you were to actively design your business and culture, then (critically) your processes, procedures, resource allocation and decision-making so as to truly recognise that the best ideas for the present and future of your business most likely already set within the minds of those in the business.
What can you do to dig out those gems? Do you need dynamite? Or do you simply need to let them float to the surface with ease once you create a culture and business that is geared around unearthing these riches?
I love working with leaders around alignment and engagement, yet what I truly love is to combine my work around such leadership with my decades in working to unearth hidden assets. Once you have an enthusiastic and aligned team, then the real fun starts. Who knows what gems will emerge again and again over time!?
So, ready to unearth your hidden assets? Let’s get on a call or meet to start that conversation!
Originally published at Tom McCallum.