Character Counts in Making Your Business Successful
Actions speak louder than words.
No doubt you’ve heard the phrase before. Chances are, you believe it. You’ve probably even applied it to your daily life and seen others do the same. It’s a noble endeavor.
But, for some, applying that phrase to daily life can be challenging to maintain day after day. It starts with one small corner cut. Then, a bigger shortcut is taken. Before you know it, the shortcut becomes the status quo.
But, here’s a secret: that method never results in long-term success, because character counts. Character is what you do when no one is watching. It’s the difference between what we know, and what we think we know.
Character is trust.
And, it’s at the heart of what makes up our business. Each day, our customers trust us to do what’s right. Distributors trust that suppliers will deliver on their promises and not cut corners. As Safeguard’s Business Acquisitions and Mergers (BAM) team works to acquire businesses and help distributors grow, we trust that we take the other party’s best interest into account, and vice versa.
But, the real challenge is that you can’t lean on the perceptions of character alone when you’re acquiring a business, or even when you’re hiring an employee. You have to do your due diligence. You need to investigate.
Trust, but verify.
In M&A, the standard tends to be even higher. Orchestrate acquisitions for long enough, and chances are strong that you’ll come close to being burned—or worse, find that a deal collapses due to preventable circumstances. Ensuring that due diligence is completed can help save a lot of long-term heartache.
I recently watched a documentary called “The Smartest Guy in the Room.” It’s about Enron, the now defunct Houston-based energy company that was rocked by scandal in the early 2000s. The documentary goes deep into the background of the company, its founder Ken Lay and its now infamous president and CEO Jeffrey Skilling.
In the film, there is a fascinating exchange between Skilling and an MBA admissions committee at Harvard University. During the meeting with the committee, Skilling was asked a pointed question.
“Are you smart?” the committee chairman queried.
Skilling’s reply was quick.
“No, I’m really smart,” he said (only he didn’t say really).
He was right. Yes, Skilling was smart—really smart, even. But, he was more focused on cutting corners and sacrificing long-term legacy in favor of more shortsighted, short-term gains. Instead of growing and thriving using the tried-and-true methods of doing things the right way, he chose rapid gratification. If you followed the story of Enron’s collapse, you know very well that it caught up with him.
It’s a curious and cautionary tale. Imagine if a Harvard MBA educated, confident, successful professional named Jeffrey Skilling had filled out an application for your company. He might have sailed through the validation and vetting process in your company, and you—or, for that matter, just about any organization out there—would likely have had justified high expectations for his success.
But, his character was questionable. And, eventually, that always shines through.
Many people are a good boss, or a valuable employee, or a great team member when times are good. What about when times are bad? What about when no one is watching? Will you do the right thing then?
Have the courage to have strong character, and it will pay off in the end. After all, actions really do speak louder than words.
R. Scott Sutton, CFE, is vice president of Safeguard Acquisitions Inc. and vice president of franchise development for Safeguard Franchise Sales Inc. At Safeguard, Sutton is responsible for the company’s Business Acquisitions and Mergers (BAM) program. In 2014, he was named a Dealmaker of the Year Award winner given by Franchise Times® magazine. He is a board of trustee for the IFA Educational Foundation and serves as vice-chair of its strategic planning committee. Follow Sutton on Twitter @rscottsutton