Gain Insights

Manage Value

Virginia “Ginny” Altman

Ginny has always described herself as a “process geek” and never imagined that she’d start a business teaching others how to value businesses.  She started her career in management consulting over 35 years ago and worked as a change management, then turn-around consultant in the US, UK, Australia and Asia. She’s also done ministry work in Jerusalem and Africa and, closer to home, founded a workforce development ministry for at-risk children in a local, economically depressed community.

The key to success, regardless of whether you want to grow, keep, or sell the value of your business, is first knowing what actually does and doesn’t make your business valuable.  Here is the story of how Ginny learned how to know that, and the experiences it took to be able to convey that to you.

We are sharing this story in four parts. Click on any title to move to that section.

1. The Foundation:  Rational Processes, Data Analytics and Empowering People
2. The Motivation:  The Saga of Owning and Selling the Family Business
3. The Preparation: Combining Theory and Street Smarts with Experience
4. The Result :  Value-Wise Business, Expert Facilitation of the 360 Business Valuation Process so you can Manage the Value of Your Business

I. The Foundation

International Change Management and Turn-Around Business Consultant

Early in her career, Ginny worked as a project manager at Ford Motor Company, implementing Total Quality Management (TQM) under the direction of Dr. R. Edward Deming, founder of TQM (which morphed into Six Sigma).  This experience taught her that understanding and serving the customers’ needs, married with an obsession with Quality, is the foundation of good business.  She learned the value of creating data to create process and performance improvement, ultimately leading to decreased work and increased profit.  This work reduced the Electronics’ Divisions production timeline from 136 to 36 months, a 74% reduction in the product development timeline.

What was the Superpower behind this success?  Ginny always believed that the Superpower of a high performing consultant is to hear the voices of the people who do the work, incorporate their ideas and thought into the work, and to give them credit in a highly visible and vocal manner.  The secret to success in creating change that works for both the business and the employees is to always find out the Superpower of each employee and to create opportunities for them to achieve the growth they desire as it supports growth and sustainability of the Company. 

Ginny also worked as an Instructional System Designer for The Army, helping to create the mapping for the first Artificial Intelligence Tutoring System.  This system was used to teach active duty soldiers how to troubleshoot the M1A1 tank’s infrared system during active engagement.  A second project with Ford involved being on the team that created the first internet-based Worldwide Engineering Release System (WERS).  Ford of Europe then recruited Ginny to design and deliver training for WERS in Europe. 

After eight years of basically non-stop work, Ginny took a three-year break to work at a Christian horse camp as a horse wrangler and counselor, a homeless agency in Charleston, SC, as a Bible teacher, and then Jerusalem to become a member of a ministry that brought Jews, Christians and Muslims together to worship their common God.  These were three of the best years of Ginny’s life! 

One of the consulting firms familiar with Ginny’s work, Kepner-Tregoe (based in Princeton, NJ), tracked her down and offered her a job that she couldn’t resist.  She re-entered the world of international consulting, this time in implementing Visual Factory concepts and preparing divisions to be sold. Working with companies like Procter & Gamble, Algoma Steel, Heinz, Hershey, International Paper, Corning, Inc. and BHP Steel, Australia, Ginny had the opportunity to not only be involved in facilitating the creation of the plan, but also implementing them, managing the troubleshooting and redesign which comes with implementation.  

Some outstanding results were accomplished: At Corning Consumer Products, we turned a -6% ROI into a +14% ROI over a two-year period – which increased the sale price from $350 million to $700+ million. At BHP Steel in Australia, we reduced quality problems by 35% and increased production levels by 22% by implementing change at the floor level.

There are no words to express the deep sense of thankfulness I have for the mentors that I have been blessed with. Ginny Altman

“Dr. Deming and Lou Focht at Ford taught compassion, accountability, and business acumen. Katie White, CEO of Corning’s Consumer Products Division, taught me discernment and data analytics. Roger Ackerman showcased my greatest professional need: to learn what it’s like to be at the bottom of the ladder where change is hardest, and most important, to implement. All of them, along with my parents, modeled high ethical and work standards. I will be forever grateful.”

“Ginny, you are one of the best consultants I ever worked with, but you won’t be brilliant until you know how your work impacts the people who work on the floor.“
Roger Ackerman, Chairman of the Board and CEO, Corning, Inc.

After the Corning Project, I followed Mr. Ackerman’s advice and fought to get on a project where I was implementing a Visual Work Factory at the floor level, where the work was being done, versus at the theoretical C-Level place.  That’s how I ended up in Wollongong, New South Wales, Australia, literally learning the ins and outs of rolling, pickling, tempering, and plating steel.  And most emphatically, the nitty gritty of the business – machine maintenance.

It took quite some time to build trust with the guys (there were no other “sallies”) and overcoming some real challenging resistance, but I stuck it out, and it paid off.  The guys on my line learned and applied more statistical process control and behavioral modifications than any of the other lines, and increased run time while decreasing defects. 

But it did take a toll on my health, and after nearly three years, it was time to come home.  I had learned so much about how different it is to implement on the floor than to theorize at the top level. I knew that I could not ever do the work I had been doing at the C-Level in the same way ever again.  It was time to go home.

FOR SALE!

Making the Decision to Sale

In the early 2000’s, I surprisingly found myself the owner of our family business, Altman Telecommunications, Inc.  My original plan was to get my nephew ready to take it over, but – surprise again – he didn’t want the responsibility of a 24/7 business.  Frankly, I didn’t want it long-term either. Combine that with the fact that telecommunication as we knew it was a dying business and it became obvious that it was time to sell the family business.

Anybody out there who owns a family business knows that the family’s relationship to that business is complicated. In all honesty, I did not comprehend how complicated that relationship was for the family. I was to live to regret that for many years.

The first thing I did was look around for how to get a business valuation.  I knew to do that because I had worked with business valuations before as a change management consultant.  On a project I worked on at Corning, Inc., Goldman-Sachs was the Investment Banker, and their valuation was our project’s measure of success. 

While I wasn’t exactly sure how valuations were calculated, after two years of listening to Goldman-Sachs’ reports each month on the success in increasing value, I had gained valuable insights into what is , and what is not, valuable when selling a business.  I had already done some preparation for getting the business ready by incorporating value-adding touches:  new revenue streams, a structured sales process, cross-training and getting our toes into the emerging technology. 

For our business, the emerging technology was VOIP (Voice Over Internet Protocol).  I managed to get three opportunities to install VOIP systems into three long-time customers’ operations.  We actually linked multiple locations over three states together in one VOIP system – an unheard of concept at the time.  It was pretty cool.  I had invested a lot of money in training the guys to do VOIP, but it only served to prove that they did not want to convert from a mechanical to a computer-based system. That surely affirmed that it really was time to sale the business.

The Business Valuation Experience

When I searched for a business valuator, there didn’t seem to be any around.  I finally found a local accountant who offered valuations; I nearly fell out of my chair when I heard the price!  In truth, it was a fair price for a mid-sized business, but for our family business, it was a way huge chunk of money.  [That’s why Value-Wise Business has a sliding pricing scale based on tax-reported revenues.]

I knew I needed a business valuation, so I grudgingly paid the price. The accountant did offer me a small discount for filling out the paperwork myself – a 20-page form that was requesting information more appropriate for a stock-based business than a small family-owned business.  I was more than willing to do it to get the discount.  That gave me some insights into what all was involved in valuing a business, but unfortunately, it did not give the accountant any insight because the document was transferred to her administrative assistant, who entered the information into a software package, and emailed the generic result back to me.

When I got it, I found a number — deep within that 50-page document that sounded like gobbledygook to me. And the number I saw for the price — the suggested sale price — seemed completely wrong to me. Like way too much more than it was worth. I knew that the state of the industry would detract from the sale price, but I also knew that the efforts I had made to prepare the business would increase the sale price. And when I called the accountant, she didn’t know either because she hadn’t even looked at my information.  And even when she did look at it, she couldn’t explain what was specifically influencing that price.

Wow.  That was super frustrating.  Super super super.

Grand Slam: Selling the Business

Now, having a sort-of price, it was time to figure out how to actually sell the business.  As frustrating as the business valuation segue was, it was a breeze compared to the frustration that came from trying to figure out how to sell a business.  Admittedly, this was 2006-2007 time frame, before Shark Tank and everybody knowing how to sale a business; and before all the new technologies to support selling a business were offered online.  In 2006, there was absolutely nobody I could find to help me with this.  My accountant sent me to the M&A folks in Pittsburgh.  They would only take clients who had revenues of $30 million or above.  (Today, their standards are a little lower, even so our business would still not be their “avatar”.)

Right.  Back to the drawing board.  So I called my accountant, who told me to go to Pittsburgh….

In desperation, I decided to use that new Search Engine technology to see if I could find someone somewhere who would help.  And I did.  For a mere $5,000, two guys in Buffalo, New York would teach me everything I need to know in two weeks to know how to sell a business.  I was desperate enough to go to Buffalo in January in the midst of densely falling, piling up snow to understudy these guys.  One of them proved useless; he came in drunk in the morning and went home for lunch and never came back.  Every bloody day.

At least I got a packet of forms more appropriate for small to mid-size businesses, and also I did actually get an idea of how to do a valuation.  Oh my Lord, that was such a frustrating time.  Today, just thinking about it makes my heart race. 

Folks, it doesn’t get better.  I had this what I considered over-valued valuation number, but no means really to determine whether or not it was over-valued.  I had spent an enormous amount of money training my techs for the emerging technology, but they never really took to it.  I had also spent enormous sums on trying to put a price on the business. I had customers I needed to take care of, and techs to outplace.  I needed to find a buyer.

Frankly, I did not have a clue how to do this. I called the other small telecom companies and their offer was pitiful. Wouldn’t cover the expenses I already had invested — and were not remotely close to what the valuation quoted. Once again, the accountant and attorney did not provide support. I don’t think I slept a whole night through for an entire year.

But finally, I did find a buyer.  One day, while pitching phone systems to a phone system prospect in Panera’s, I overheard some guy talking about his phone company.  Boy did my ears perk up!  I couldn’t wait for my sales call to be finished so I could get to that guy before he left.  I closed the deal, thanked the customer, and went over to the telephone guy and said:  “Did I hear you say that you own a telephone company?”  And he said, “Yes, you did.”  And I said, “Great, because I have one too and you are going to buy it.”

And he did. Unfortunately, he was being slammed by the VOIP industry change too, so he didn’t last long, didn’t make the payments long, and I didn’t want it back.  Believe me, there were some unhappy customers. When the buyer declared bankruptcy, the techs dispersed and I couldn’t get them back. And unfortunately, I had not known that you could write a clause into a purchase agreement that places you in line for payment if the purchaser declares bankruptcy. Nor how stupid it was to not get the money for the business up-front. Unhappy ending to the business my dad and sister had operated so well for 28 years. And I was seen as the author.

III. The Preparation

Combining Theory with Street Smarts and Experience

Ginny often says that her business brokerage was a training ground for creating Value-Wise Business, a company that not only delivers important business management information to business owners, but empowers them to take control of the value of their business.

Thanks to my years as a consultant who implements (not only designs) change, I gained a deep understanding of how businesses do (and do not) work internally.  But selling the family business brought me face to face with the fact that I did not understand how the greater world – the economy – works.  How do you make connections, what are the interdependencies, how do you find who you need?  What influences the economy thus sale prices; what makes a buyer’s market, a seller’s market?

So I enrolled in the Public Management program at Carnegie Mellon University.  Wow, I learned a lot!  I was fortunate to have Investment Bankers as adjunct professors who taught us how the Mergers & Acquisition world works. One of the most important things I learned was how important it is to have data to back up the sales proposition. This fit right in with what I learned from Dr. Deming at Ford and Ms. White at Corning: Create data that has a voice. Because CMU has an extraordinary emphasis on doing project work out in the community, I began to gain an understanding of how business intersects with community.

If I was going to work with the owners of small businesses, I needed something more specifically designed for small to mid-sized businesses than CMU offers.  The International Business Brokers Association was the just the ticket.  They offer a Certified Business Intermediary Certification (CBI) – a two-year program even more intense (and with more credit hours) than my CMU Masters.  Courses were delivered in different locations across the country, where local business brokers taught us how to do business valuations – like, real-world, not just a generic formula.  They taught us how to market and sale, what pitfalls to avoid.  It was an amazing education!

Feet-on-the-Ground Experience

When I opened Altman Business Solutions, aka Altman Profit Solutions, in 2008, my intention was to be a consultant who helped business owners to grow the value of their business, capitalizing on the super power of data analytics. But everyone who came to Altman was ready to sell their business NOW. So I hired an incredible website company who put an exciting website together, and I put together the process for selling businesses. Leads came tumbling in.

This was before Shark Tank, and business valuing and selling was pretty much an industry cloaked in secrecy, protected by The Old Boy Network. Selling businesses outside of that network required subscribing to a number of services to gain the information and systems needed to do the job. But the business flowed in (lots of owners had the same frustration I had when I wanted to sell Altman Telephone). This was all good until the economy started to tank. By 2012, business brokers were sorely lacking in business. The good news: It gave me the opportunity to get my first on-the-floor laborer job to support a decimated business. I can honestly say… I stank at the job. Manual labor wasn’t a sharp tool in my toolbox… yet.

It so happened that one day, in late 2012, a business man in Connecticut called and asked me to come and get his business ready to sell. It was the opportunity that could be leveraged to move Altman into the consulting groove. I completed two, two-year projects before moving back home. When I did, I engaged in the Exit Planning certification to gain more insights into the overall exit planning process. Then I opened The Exit Eagle, focusing more on value acceleration than business brokering.

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