Instructor

John Pruitt
John Pruitt is the founder of A/E Consulting Services, Inc. He has developed a national reputation as a planning and management expert for A/E firms.

John is noted for his analytical ability in identifying and resolving critical management issues. He has worked with more than 300 leaders of A/E firms across the nation.

He is a CPA, and holds an MBA in Finance. He was awarded a Certificate of Achievement for Business Valuations by the AICPA.

Currently he is an Associate Editor of the A&E Business Journal and a frequent speaker at various seminars and professional conferences.

Back to Top

Course Description

This seminar gets to the heart of how to develop and operate a successful engineering business. The more effectively a business plans and executes its plans, the more successful and profitable a business tends to be. Presented are practical techniques used to develop viable strategic plans, how to highlight the essence of the plan so that the key elements can actually be remembered, and how to translate the strategic plan into an operating plan. Methods are presented on how to overcome the inertia associated with implementing the changes that need to be made to enjoy more success.

“Value” issues typically surface when developing a strategic plan. Understanding what comprises value is critically important for owners, potential owners, and managers of professional service firms. The purpose of this seminar goes beyond the traditional means of determining the Fair Market Value of a firm, to include critical issues such as the education of potential buyer/investors regarding what creates value, how human capital enters into the equation, company structuring issues, and off Balance Sheet items. The better owners/managers understand what constitutes “value”, the greater is their ability to increase the value of a firm.

Ownership transition planning always plays an important role in a viable strategic plan. Attracting and keeping talent, along with providing an exit strategy for retiring owners are mission critical elements for successful firms. This seminar examines how to develop an ownership transition plan that fits your firm, and then how to implement the plan. Creative means that may possibly enhance the transitioning process are discussed including the use of deferred compensation programs, Limited Liability Companies [LLCs], ESOPs, and serial redemption. Participants will also learn the “Golden Rule” of ownership transitioning.

Back to Top

Seminar Benefits

You will learn:

• Strategic trends and directions now being taken by design firms
• How to develop a well designed strategic plan that fits your firm, including how to focus on critical issues that will result in:
• Attracting and keeping more talented employees
• Performing more sought after projects
• Prospering in spite of the inevitable economic downturns
• Working with preferred clients
• Presenting more options when owners retire
• What constitutes “value”, and techniques used to value firms
• Legal environment of company valuations what to expect how to identify “hidden” assets and liabilities
• Key elements of the “due diligence” process when buying, selling, joint venturing, and merging a firm
• Typical terms and conditions when firms are sold to third parties
• Structuring your firm for improved profitability
• Types of business entities and how best to use them
• How to develop an ownership transition plan for your firm:
• Developing multiple options for ownership transitioning
• Developing key employees into qualified owners
• Developing the Buy-Sell Document what it should and should not contain
• Funding issues for both retiring owners and new owners, and how they can be effectively addressed
• How to put it all together, increasing your firms success and profitability

Back to Top

Special Features

• Case studies are used to learn from the experiences of other firms
• Extensive handouts are included as part of the course materials

Back to Top

Who Should Attend

This seminar is designed for owners, potential owners, and managers of firms who want to better understand how to develop effective strategic and ownership transition plans. Also, for those who want a better understanding of how to value a firm and the process of buying and selling professional service firms.

Back to Top

Summary Outline

• Strategic Planning
• The process:
• Where are we [versus the competition]?
• Where are we going?
• How do we get there?
• Long-range visioning techniques, and the development of mission and vision statements
• The strategic planning retreat:
• How it is conducted?
• What it should accomplish
• Strategic plans and the entrepreneurial perspective
• What a good planning system avoids
• Translating the strategic plan into strategic initiatives and the annual operating plan
• Ownership Transitioning
• Why firms develop ownership transition plans, typical ownership transition scenarios, recurring themes of management transfer, and options added with a properly structured ownership transition plan
• Process of developing an ownership transition plan:
• Defining objectives
• Developing criteria for ownership
• Identifying potential new owners
• Growing your own-developing business talent
• Ownership transfer schedules
• Valuation approaches discussion
• Develop reward distribution policy
• Test assumptions-financial modeling
• Evaluate funding and financing of stock/ownership transfers
• Establishing shareholder return expectations
• Determine agreement provisions
• Identify the steps for implementation
• Elements of a shareholder’s/member’s agreement
• The “Golden Rule” for internal transitions
• Overcoming inadequate funding and other topics such as ESOPs, deferred compensation plans, and serial redemption
• Understanding the type of business entities:
• Sole proprietorships
• Partnerships and limited liability companies
• S & C Corporations
• Company Valuations
• Reading and understanding financial statements
• Valuation considerations:
• What creates value?
• Getting a company ready to sell
• Why sell?
• Who buys, including when it makes sense, the due diligence process, what successful acquisitions typically include, and developing the selling plan
• Valuing a firm:
• The legal environment
• Appropriate and inappropriate methods to determine Fair Market Value
• Approaches used for valuations:
• Adjusted book value plus future earnings capacity
• Capitalization of historic income
• Discounting projected future earnings
• Publicly traded company approach
• Introduction to formula approaches
• Looking beyond the numbers
• Tying it all together—how to increase your success and profits

Back to Top

Attendees’ Comments

“As an owner, I now have a better understanding of the critical elements for success of a firm. Interaction with other owners with different sizes and types of firms was an added benefit of attending this seminar.”
Joe Rafferty, President,
Redwood Geotechnical, Morgan Hill, CA

“An excellent broad exposure to strategic planning and to the concepts of ownership transition and company valuations.”
Cal Goldsmith, Vice President,
Ayer, MA

“This was a very informative seminar. The seminar group and the round table discussion format is a great means of sharing information with toher firms with similar concerns.”
Steve Petersen, Partner,
Ingenium Consulting, Augusta, GA

“Excellent subject, covered thoroughly. A lot of useful information worth many times its cost.”
Tom Ruggles,
Ruggles & Bhom PA, Wichita, KS

“Very well organized, accessible information. The course provides tools to make the transition from an engineer/owner to business manager.”
Joe Rafferty, P.E.
Redwood Geotechnical Engineers, Inc., Morgan Hill, CA

Back to Top