A man was walking by a massive construction site when he noticed three stonemasons busily at work. He asked the first one what he was doing, and he replied, “I’m laying bricks.” The man asked the same question of the second stonemason and received a slightly different reply: “I’m building a wall.” Upon posing the question to the third workman, the old stonemason straightened his back, wiped his brow with the back of his forearm, gazed up into an empty sky and said, “I’m building a cathedral.”
Stephen Covey’s principle of beginning with the end in mind is true of a wide range of business and personal endeavors. It is especially true of building a company’s brand. In business terms, it’s called planning for succession. And while there are many legal and financial details associated with a business’s succession strategy, an oft-overlooked component is a company’s brand.
This is perhaps the most important outcome of effective branding. That’s because at some point in every company’s history, it will either be:
a. passed on to one’s children
b. acquired by partners in the firm
c. sold to investors
d. purchased by another company
e. go public
f. pass into oblivion
In all but the last and regrettable outcomes, a strong brand delivers more value at the time of succession. This can translate into hundreds of thousands or even millions of dollars in an acquisition. Smart investors pay good money for well-regarded brands. That’s because brands guarantee the loyalty of existing customers and the likely attraction of new ones. Brands thus function as insurance policies securing future income.
We’ve had the remarkable opportunity over the last month to meet with almost a dozen business owners and CEOs inquiring about our firm. And in every conversation, the most important topic we raised was that of the company’s end-game, its succession strategy.
Sure, marketing needs to make the phones ring, increase market share and expand share of customer. But while addressing those vital, near-term issues, we intentionally direct clients and prospects to see how a well-crafted brand can translate into a measurable increase in company valuation when it comes time to sell or pass it on to others.
A well-defined and compellingly communicated brand increases company value. All stakeholders win. So while it’s important to do a quality job of brick-laying every day, it’s equally important to keep your eye on the cathedral you’re building.