It is time to define your strategy. Your Halloween strategy that is.
We are only a few days away from Halloween, costumes, and trick-or-treating. Kids have trained all year for these two special hours where they collect candy and sweet treats from their neighbors. They practice their enunciation to craft the perfect “Trick or Treat,” “Happy Halloween,” and “Thank You!” They build up their stamina in preparation to walk a few miles to reach the houses with the king-size candy bars. And, unfortunately, they argue with their mom because “The coat would ruin the costume.”
When Halloween night arrives, the kids have everything in place for a successful and candy-filled evening, even though they have to pretend they are not frozen to the bone in the crisp fall night air because they refuse to don a jacket under their costumes. After traversing their neighborhoods, they arrive back at their homes and dump their pillowcases of candy onto their living room floors. And like kings surveying their kingdoms, they survey their riches.
The living room turns into a boardroom, with the competing parties on opposite sides of the area rug. A child dressed as LEGO Batman in one corner and a small girl in her Barbie ensemble in the other. Halloween night’s most critical decision-making time has arrived. The stressful and strategic candy swap.
The only question now is: how should they sort their candy?
A Pile of Riches
After pouring their pounds of candy onto the floor. Some kids dig right in to enjoy piece after piece of their favorite confections. They riffle through the plastic wrappings in search of another piece of candy. However, the pile seems to swallow them whole, and any hope of finding that one treasured chocolate bar is gone. In this unorganized mass of candy, the child has almost no hope of gauging how many KitKats they have, let alone how many they would be willing to offer their trick-or-treating compatriot in exchange for a Reese Cup.
How can you be expected to know the value of your business if you do not have an organized record of financials, systems, and operational efficiencies? The most robust of the four intangible capitals in every owner’s business is their Structural Capital. Structural Capital represents the strength of your strategy, systems, processes, capital, and financial structure.
Think of your candy pile as your financial records. From a buyer’s perspective, the value of the company as a whole is a larger factor in purchasing the business. Business owners should review their financial records regularly to gain an understanding of their business's financial health and to identify any potential problems.
Organized Collections
Some kids meticulously sort through their candy haul. They first separate the candy into piles. The KitKats in one bunch, Reese Cups placed in their own peanut buttery assortment, and the dreaded boxes of raisins in a sad group off to the side.
From there they grab the notepad off of the kitchen counter, rip the top sheet with tomorrow’s grocery list off the pad, and get to work making a detailed inventory list of tonight’s candy collection. 20 Snickers, 15 bags of M&Ms, 14 KitKats. This list is then broken down even further with subcategories under each type of candy referencing the amount of fun size versus king-size pieces in each flavor. This child heads into their negotiations knowing exactly what they are willing to exchange and what they want from their costumed friend’s candy pile to fill out their collection.
As you can imagine, this child is not messing around when it comes to their candy. They understand the value of what they have collected and make sure that value is represented during the trade.
Structural Capital explains the how and why behind everything your company does. Chris Snider refers to this in his book, Walking to Destiny, as the “secret sauce.” How well is this strategy documented? Is there proof of the outcomes of these strategies and how they have been altered and updated as the business scales?
A well-documented business strategy allows individual employees' best practices to be converted into company property that can be sold or transferred to the next owner. Structural capital is the knowledge, processes, and systems that make your company unique. It's what allows you to do what you do, and it's what gives you a competitive advantage. A well-documented Structural Capital strategy is an essential part of any successful business. It can help you grow, scale, and compete in today's marketplace.
Learn more about the importance of strong structural capital in our Four Intangible Capitals Whitepaper.
