"A goal without an action plan is a daydream."
Nathaniel Branden, practicing psychotherapist, corporate consultant, and author

The final step in the exit planning process involves creating the action plan for the business owner and the business. The action plan moves the business owner from the planning phase to the implementation phase and deals with the following basic questions:

  • What tasks need to be done and when?
  • Who will do it?
  • Who will ensure it is done?
Developing the action plan is a process that will take time but it is a critical step because this will determine what initiatives (short-term and long-term) will be implemented to ensure that the exit planning goals are met. This process begins with assembling the key individuals (e.g. business owner, family, management team, professional advisors) for a strategic planning session.

Strategic planning sessions should be limited to 2 or 3 hours to avoid information overload, frustration and inefficiency. The meeting chair will also distribute an agenda to participants beforehand. Agenda items for the initial strategic planning session will include:

  • Goals - restating the goals and objectives (from Step 1);
  • Challenges - brainstorm obstacles that will prevent the business owner from achieving these goals; and
  • Strategies - brainstorm strategies that will help overcome the challenges and help meet the goals
As many challenges and potential strategies as possible should be identified in this brainstorming session - aim for at least 20 challenges and 10 strategies at this stage. Each strategy will be linked to one or more challenges.

Each strategy can then be rated in terms of timing (immediate, short-term, long-term) and priority (low, medium, high). The top 3 to 6 strategies should be selected to form the basis for the action plan. Ideally a consensus will be reached after much discussion regarding the pros, cons and other issues surrounding each strategy. 2 or 3 strategic planning sessions may be required to accomplish this.

Exit planning strategies could include: prepare a business plan, prepare a contingency plan (update the will and obtain adequate insurance coverage), prepare tax and estate plans, implement value enhancement initiatives, identify a successor, etc.

Specific tasks will then be identified for each of the selected strategies and an individual will be assigned responsibility for ensuring that action items are implemented. This process can be overwhelming and should be simplified by breaking each strategy down into manageable pieces that will be easier to accomplish. This will build momentum for the implementation of the entire action plan.

Some of the strategies can be implemented by the business owner and/or management directly. Others may require the involvement of professional advisors with specialized expertise.

Regular meetings (e.g. quarterly) should be scheduled with the entire team to hold individuals accountable for their responsibilities by reporting back on progress made and next steps. Having an outside consultant chair the meetings will keep the team focused and accountable for getting tasks done efficiently and on time, ultimately ensuring results are consistent with goals and expectations.

Don’t let your goals remain a daydream - turn them into reality with an effective action plan!