Keep a steady hand on the tiller. We're talking about the importance of making decisions as an IT Services leader - yes you read that right! We often see struggles and delays in decision making in business which can get in the way of growing and prospering. Listen as we unpack decision making and how to keep your business moving forward.
Mike Harvath 00:04
Hello, and welcome to this week Shoot the Moon podcast, broadcasting live in direct from revenue rocket world headquarters in Bloomington, Minnesota. I'm Mike harvath, President CEO of revenue rocket. For those of you that tune in regularly, you know that revenue rocket is the premier growth strategy and m&a advisory firm for tech enabled services companies worldwide. With me today is my partner Ryan Barnett. Welcome, Ryan.
Ryan Barnett 00:32
Hey, Mike, thanks for having me. I appreciate that. keep on rolling with these podcasts and keeping our users and our clients and listeners engaged. So today, it's really, really easy to be flooded with a lot of information. And there seems like there's points along the way that makes you question a little bit of everything. And sometimes it's hard just to to come up with a decision. So, Mike, I want to talk to you today about really the importance of making a decision. And what why is that critical for IT services leaders today? And what are some things that they can do? Maybe around big points of decision that can help go from inaction to action? So, Mike, take it away?
Mike Harvath 01:21
Yeah, you know, when we were chatting about this, kind of around the watercooler, which we do here, time and time, you know, it struck me that many folks in in and around our industry in the business struggle with you know, making a decision. And oftentimes that delay in making a decision or feeling that you need to have more information to make a decision gets in the way of them successfully growing and prospering in their business. And so I guess what I would encourage folks is they sort of think about their own decision matrix and how they evaluate, either working with a vendor, like revenue rocket, or whether it be making a decision about a hot new hire, or making investment in their own business, is that they try to make an informed decision without fear. Because fear will cause you to freeze your decision usually, and may cause you to make no decision at all, which we think is the worst path. So we want to encourage people to proceed with confidence, gather the information, gathered the critical data points, and proceed with competence, and make timely decisions. And I think if you work on that, inside your business and your personal life, you'll have a lot less stress, and you'll be a lot happier. I know this is a work in President a work in progress for me my whole life. And you know, it's personal to me that you have to think about, you know, what, what do you do with the big decisions come? And I think, you know, some of the things I've learned along the way are, you want to gather the facts. You want to gather input from knowledgeable advisors, and then you want to make a decision, and whether that be yes, or no, or do or don't, or whatever. And that should happen in a reasonable period of time. And you shouldn't tend to avoid groupthink, you don't want to get sucked into that. And you want to try to not make decisions based on fear. But based on information. I think part of this is
Ryan Barnett 03:23
our the audience that we work with. So we've got some brilliant technologists who have explored and understand a myriad of different opportunities within the technical world. And when you have that much choice, and that was flexibility, and the ability to kind of evaluate so many things, oftentimes that that mode of thinking can lead to a bit of analysis paralysis. In reality, if you're thinking in the mergers, acquisition space, some of those decisions are absolute critical. But time is always against you. And time will always kill it kills all deals. But sometimes making the decision to move forward is as important as making noticing. The same with just getting to resolution. If you're working through accounts, or you're working through some questions, letting something hang out there because perhaps you don't want to deal with it, or it's a emotionally charged issue or something just kind of tired of dealing with. It's really critical to get to those items and work through them. There are some things where it's actually important to get something done and understand that getting through the gate may be more important than the then than what's on the paper. I'll give a good example in that, in a letter of intent and immersion, acquisition space, are most often non binding. So there are things that are written within a letter of intent that will be changed many times before that Purchase Agreement. And it's better to make decisions on general guideline and get something in front of a user, then to try to optimize that letter content in that at that moment in time, like any thoughts around that?
Mike Harvath 05:22
No, I think, you know, it's important, it's an important thing, right? It's important to be in the moment and be present, you know, in these decisions. And I think it's important to, especially for the big decisions, you know, really lean on advisors that are not emotionally attached, it's easy to get into sort of a mode of being emotional about big decisions and worrying about, you know, what happens if, what if, you know, we fail? What if we miscalculate? What if we, you know, buy this company? And it's not what it's supposed to be? What if, what if what Yeah, I think oftentimes, we don't ask, What if we're going to be wildly successful? Right? What if everything goes as planned? What if, you know, we tend to be more worried about the bad outcomes, and we sort of ruminate on them. And oftentimes, that leads to, you know, challenges and making those calls. So I think a balanced approach, I think one that is fairly binary, once the information is gathered, is where it's all at.
Ryan Barnett 06:35
And you're not advocating making a decision without knowledge. So in the case of a letter of intent, it's critical to get a valuation done first, before you issue a letter of intent to buy a company, and to, to clearly evaluate deal terms and to clearly evaluate the structure and enterprise value in regards to what can be a win win deal for everyone. But actually making the decision to move forward and to actually execute. The, the, the contracts is sometimes just as important, and as the deal flow itself. Like, there's other big decisions out there things like hiring and firing employees, or bringing out the choice to bring on a client or evaluating vendors. You know, are there some tips that you can give users to help make some of these decisions or, or just in general dinners, philosophies that have been successful in what you've seen in doing merchant acquisition transactions?
Mike Harvath 07:48
Yeah, you know, I think, you know, leaning in on the hard decisions, and being thoughtful about them, is, you know, important, I will tell you that you will make mistakes, you will make hiring and firing decision mistakes, you'll make m&a mistake, you're gonna make mistakes, people make mistakes, we all certainly we learn a lot from them, right? So it's not like that is a, you know, going to have a terrible outcome in its own right, per se. I think if you're going to continue to learn and expand, you have to be open to the fact that, you know, if you make the wrong decision, and it turns out poorly, the experience that you've gained from that probably will flavor those kinds of decisions for the rest of your life, and make you ultimately a better decision maker or a better you know, you'll you'll have what we call, you know, the learned lesson, if you will, some people call it the, you know, business, the street MBA, some of those lessons are very, very valuable to be gained in the context of m&a or in the context of, you know, in the context of hiring and firing or making investments or whatever they might be, they help you be better. And I think in the end, you can't, you know, forget about that, that, you know, if you take the risk to make a decision. You know, you have a fairly you know, it may turn out well, I may not right, just based on how informed that decision was at the time. But you have to be okay with that. Going into it. I think in the end, even if it was a mistake, you knew going in that that was a risk, and you can't beat yourself up for that you just have to learn from it and move on and and, you know, no that should that decision come around again, you're gonna probably make a better one based on that experience. Now, very true.
Ryan Barnett 09:56
And one area that we seem to run into a lot When it comes to m&a is oftentimes people making no decision. We see that as a, you know, in our world, that's almost the biggest competitor is someone deciding to not do something. But if someone, if you decide not to do something or not to move forward, it's also helpful just to let people know. So you may have come to a conclusion that you're not willing to do something. To, it's worse if you just go dark, and don't respond to something than to simply say, a courteous No. And I've moved on. So even if you haven't made a decision, communicating that decision decision is often critical as well.
Mike Harvath 10:44
Well, I'd say it's a, it's a requirement to being an effective leader, to be an effective business leader, is to notify the stakeholders of your decision, you know, why you made the decision? You know, it's pretty important that and it can even be as simply as, hey, I changed my mind is why I made that decision. That's okay. But I think effective leaders do a good job of communicating kind of where they're at and what their decisions are. And they're not wishy washy about it, right. They're not like, well, maybe and if this happened, and, you know, certain things occurred, and then I might think about it, you know, that's not necessarily the best path. And so, I think it's important to be forthright and upfront with people and as appropriate, involve them in the decision. But more importantly, if the decision has to be made in favor of doing something or not, it's important that you notify all the stakeholders of that decision. So they know how to specifically react to that and move forward.
Ryan Barnett 11:52
Mike, those are kind of the big questions I have this is I know, an area of passion for you. I'll leave it to you to wrap it up.
Mike Harvath 12:02
Thanks, right. Well, I can see is what's based in inaction or indecision, oftentimes this fear, and we shouldn't live a life of fear and high stress, right, usually fear and high stress are correlated. And, you know, I would encourage everyone to focus on making informed and timely decisions, to communicate them to the stakeholders and to be you know, at peace with those decisions, regardless of their outcome, whether they be worked out as planned or not. Because you know, going into some of those difficult decisions that they may work out, and they may not work out. And then even if they don't work out as planned, there's going to be some learned lessons along the way that should help you in further negotiations or decision making. And so with that, we'll tie a ribbon on it for this week, Shoot the Moon podcast in March of 2023. We encourage you to tune in next week for more thoughts and ruminations on how to grow your IT services company and how to facilitate successful m&a deals. Make it a great week.