As a Certified Exit Planning Advisor (CEPA®), your business-owner clients aren't the only ones who need to learn and implement the Value Acceleration Methodology™ (VAM) in their operations. To build the best exit planning practice possible, your internal team must do so too if you want consistent Value Acceleration results, not one-off wins.
Mentoring your fellow advisors on the basics of Value Acceleration turns VAM into your team's shared language, scales capacity across the three gates: Discover, Prepare, and Decide, and sets both you and your clients up for success.
To start, it's a good idea to refamiliarize yourself with the Value Acceleration Methodology. Even if you are a veteran CEPA who has been living in the methodology for years, it's important to be able to explain VAM in easy-to-understand terms that not only your clients but also your advisor team can understand.
The Exit Planning Institute® (EPI) defines the Value Acceleration Methodology as the strategic framework for exit planning. It guides business owners through three gates, Discover, Prepare, and Decide, to create value and align business, personal, and financial objectives.
When mentoring your team through VAM, it’s crucial to emphasize becoming a value creator, not just an income creator.
“Value Acceleration can also be used as a developmental, intergenerational, and employee transition and measurement tool to educate the next generation of management,” writes Christopher Snider, EPI Chairman, in Walking to Destiny. “It is used to teach your team how to create value — not just income — measure their performance, and benchmark value creation.”
Once your team is familiar with what VAM is, it’s time to implement it in your day-to-day operations and create a Value Acceleration culture.
Structural Capital captures the knowledge assets within your firm, the people, processes, technology, and intellectual property that make your team special. Why is this so essential to building a successful exit planning practice? It makes your expertise transferable and scalable.
“Your knowledge needs to be documented and transferable, such that someone else can learn from you and apply it,” Christopher writes. “Making this knowledge company property ensures that when your talent walks out the door at night, the knowledge they house doesn’t walk out the door with them.”
This is not only crucial for ensuring that your firm can still run smoothly without your hands in the mix every day, but it also helps create alignment. Just as VAM aligns a business owner’s personal, business, and financial goals, building strong Structural Capital can create alignment within your firm.
To help your team build substantial structural capital, have them create standard operating procedures for their most crucial tasks, and do the same for your role. Having clearly written instructions for performing key functions in your firm is a textbook way to create value through transferable knowledge.
Through VAM, leadership and accountability are encouraged at every level of a company, so leaders can step away confidently knowing their operations can run smoothly without them. This starts with building out your Structural Capital, which sets the foundation for your company’s culture, or Social Capital.
Social Capital is the measure of the strength of your culture. It requires key employees to build relationships, gain confidence, expand their capabilities, and grow their social and emotional intelligence.
Structural and Social Capital exist alongside Customer and Human Capital, which are key parts of VAM. These four intangible capitals have the biggest impact on determining and improving business value.
We’ve already touched on Structural and Social Capital, but how can you define Customer and Human Capital? Customer Capital is as simple as it sounds: it’s the strength of your relationships with your clients. Human Capital is the measure of your people, talent, and ability to execute
As you work with your team to implement Value Acceleration into their day-to-day operations, and just as importantly, yours, all four of these intangible capitals will come naturally.
The goal of implementing VAM into your firm is to create a culture where everyone can explain how their role helps owners accelerate value. The benefits include a more consistent owner experience, meaning happier clients, limited risk with a cohesive message, and more trust between you and your clients.
When VAM lives in everyone's head instead of just one advisor's, your firm unlocks the keys to sustainable exit planning success.
The Value Acceleration Methodology™ is the strategic framework for executing exit planning, creating value for the business owner’s company while aligning their business, personal, and financial goals. The Value Acceleration Methodology guides the Certified Exit Planning Advisor and Business Owner through three gates (Discover, Prepare, and Decide) with the ultimate goal to move to advanced value creation or to exit the business.