410 - Your Reputation Is Your Greatest Asset

0:00Bruce Whipple:Today I want to talk about something that has nothing to do with EBITDA, financing, letters of intent, or finding acquisition prospects. But I would argue that it can have as much impact on your success as any of those things. I'm talking about responsibility, integrity, and following through on what you say you're going to do. These things matter in every part of life, but it's particularly important in business acquisitions because you are constantly asking people to trust you. A seller may be trusting you with a business they spent 30 to 40 years building. A banker may be trusting you to repay a loan.

0:41Bruce Whipple:Employees may eventually be trusting you with their livelihoods. Your attorneys, accountants, advisors, partners, investors, and board members all need to know that when you say you're going to do something, you do it. Your reputation becomes an asset, and sometimes your reputation is built most clearly when something goes wrong. And I want to give you three examples. Recently, I worked with a tech person on a project and we created askbrucewhipple.com. By the way, I would encourage you to go there. There are 12 quick questions that will help you determine where you are in the business acquisition process, identify some of the gaps you may need to work on, and give you access to the free short book I recently wrote, Becoming a Successful Business Acquirer, Why Every Step Matters.

1:42While we're building that system, we had a technical problem involving an API.

1:49Bruce Whipple:Now, I'm not a particularly tech-savvy guy, and at the time, I was not even sure exactly what an API was. I thought perhaps the problem was with the platform we were trying to connect to. But the tech person looked into it and came back to me and basically said, no, this is on me. The problem is the way I connected the API. That statement increased my confidence in him. Think about it. He made a mistake and my confidence in him went up. Why? Because everybody makes mistakes. The question is what you do after you make one. He could have ignored the problem. He could have blamed the platform for the problem.

2:31Bruce Whipple:He could have tried to quietly patch it and hope I never knew what happened. Instead, he stepped up and said, this is my responsibility. then we fixed it. And because we understood what had gone wrong, we were able to correct the underlying problem so it would not continue to create problems as we expanded the system. That is responsibility. That is integrity. And that is how trust is built. Integrity does not mean you never make a mistake. It means people know they can trust what you will do after you make one. Here's a second example. I see people occasionally get themselves into trouble, particularly financial trouble, and then they disappear.

3:17Bruce Whipple:They stop returning telephone calls, they stop responding to emails, they avoid the person they owe money to, or the person they made a commitment to. They ghost them. That is almost always the worst possible response. Problems do not solve themselves. And the longer you wait, the fewer options you typically have. Suppose you have a financial problem today and there's five different ways you could solve it. If you address it today, you have time. If you ignore it for 30 or 60 days, for example, perhaps four of those five solutions disappear. So addressing a problem immediately is not simply the right thing to do, It's usually the smart thing to do.

4:04Bruce Whipple:And there is another reason. In the business acquisition business, you will trade on your reputation. People talk. Sellers talk to advisors. Bankers talk to other bankers. Attorneys know other attorneys. Investors know other investors. Your reputation follows you. If you have a problem, communicate. If you cannot do something you said you would do, tell the person before they have to chase you. If there's bad news, deliver it. You may be surprised how willing people are to work with you when you are honest with them. But once someone decides they cannot trust you, repairing that relationship becomes much harder, and oftentimes you can't repair it.

4:53Bruce Whipple:The third lesson is responsibility. When something goes wrong with other people. It's very easy to point your finger at someone else and say, the employee did not do his job or her job. The attorney dropped the ball. The board didn't help. The acquisition team did not perform. And maybe all of those things are true. But somebody once told me that when you point one finger at somebody else, there are three fingers pointing back at you. Successful people ask another question. What part of this is my responsibility? Suppose you create a board and six months later, you're frustrated because the board is not doing what you expected.

5:38Bruce Whipple:Who selected those people? You did. Did you clearly explain what you expected from them? Did you give them specific responsibilities? Did they understand what success looked like and how to do it? Did you follow up? Did you lead that board? A board may govern, but somebody has to lead. And I'd argue if this is your venture, that somebody is you. The same principle applies to your employees, your advisors, and your acquisition team. You absolutely should rely on the expertise of other people. You should not try to do everything yourself. But there's a big difference between delegating responsibility and abdicating responsibility.

6:26Bruce Whipple:Delegation means, here is what needs to happen. Here is what I expect. You have the expertise to determine how to accomplish it. Let us agree on when we will follow up. Abdication means, I gave it to somebody else, so I assume it is being handled. Those are two very different things. Ultimately, you are the captain of your own ship. Not everything that happens to you is your fault, but what you do about it is your responsibility. And when you lead that way, something else happens. Your team watches you. If you admit your mistakes, your people become more comfortable admitting theirs. If you address problems immediately, your people learn to address problems immediately.

7:14Bruce Whipple:If you follow through on what you say you're going to do, your team begins to understand that commitment matters. But the opposite is also true. If every problem is somebody else's fault, your people learn to point fingers. If you do not follow through on your commitment, eventually they will not either. You set the standard. So here's my message today. Take responsibility. Act with integrity. Do what you say you're going to do. When you make a mistake, own it and fix it. When you have a problem, address it as soon as humanly possible. And when somebody around you disappoints you, before you point the finger at them, ask yourself what you could have done differently.

8:03Again, you are the captain of your own ship. Lead from the front. and protect your reputation because in the business world, as I mentioned, it may be, and I think it is, one of the most important valuable assets that you have. And before you go and stop listening to this podcast, take a few minutes and visit AskBruceWhipple.com. Answer the 12 questions and see where you stand in your business acquisition journey. It will help you identify some of your gaps, and you will also receive access to my free short book, Becoming a Successful Business Acquirer, Why Every Step Matters. I would really appreciate your feedback and whether that book and the 12 questions help you.

8:56Did the questions help you identify something you need to work on? I hope so. That's the intent of it. And what did you think of the book? Did that do the same? Did it help fill in those gaps? Until next time and the next podcast, keep pushing. And remember, this is your venture. This is something that you've created. Take responsibility for that. Take some gratitude in what you've created. A lot of people don't realize each of these steps are steps where you've accomplished something in the beginning you probably didn't think you could. So take a few minutes to celebrate the success, but keep pushing, keep moving forward.

9:39And if you lead from the front, you'll be amazed at the difference your team will do in how they perform.