Cause and Effect

One of the best known natural laws is the law of cause and effect.  It is one of the most universal and most certain of all laws.  It simply states that every material effect must have an adequate cause that existed before the effect.  Or to say it another way, material effects without adequate causes do not exist.

In working with many companies over the course of my career, I have seen the truth of this law repeated over and over both good and bad.  A company that is struggling with cash flow, profits, growth, people issues, or a combination of these or other problems is an effect that was the result of a cause  or causes that produced these effects.  On the other hand, well run, healthy companies are also the effect which was produced by causes.  A business owner must ask himself two questions.  What is the effect I desire for my company, and what are the causes that will produce the desired effect?

I am certain there is one effect desired by virtually every business owner; a company that is valued much higher than its competitors especially when it is time to exit the business.  So, what are the causes that will produce the effect of a company of high value?  Consider the following causes:

  • A well thought out and planned exit strategy with a step by step process
  • The selection of a competent professional success team to advise you, chosen several years before the target exit date
  • Increasing the sales and sales diversification of your business
  • Improving the processes and efficiencies within your business
  • Adequate branding of your company

The above causes will produce the desired effect, a company of high value that will outclass the competition.  It is a universal  law.

*Mills, Jerry L., (2013), The Exit Strategy Handbook

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