Ephor Group eNewsletter

www.ephorgroup.com | 24 E. Greenway Plaza Suite 440 | Houston, TX 77046

Over the past decade, we have identified the attributes required in the development and success of numerous transformational and industry

sector leadership business models.

Creating Wealth Crossing the Chasm Preamble. The majority of small and medium business leaders, especially those in new markets, generally illustrate a background that is dominated by one or two functional areas of expertise. (i.e. technology/engineering, or sales & marketing). Therefore these leaders rarely are “fully or adequately skilled” to effectively lead and manage all the functional areas of a emerging and complex business. This has become especially prevalent in the post 2009 restructured and complex economic and legislative environment.

The Big Idea. Organizational Clarity has four components that must work conterminously and are mutually dependent upon each other for transformational or sector leadership and success:

1. Strategic Clarity 2. Operational Clarity 3. Tactical Clarity 4. Financial Clarity

The Outcomes of Organizational Clarity include:

A Sector Influencer or Sector Transformational Business Model Exponential Shareholder and Entrepreneur Wealth Creation Significant Economic Societal Success and Job Outcomes The Desired “Storybook Outcome” for all Stakeholders

The Result. Simply stated; crossing the chasm from a small lifestyle oriented business, to a wealth creation entity requires holistic wealth planning, effective leadership and management skills, coupled with “best of breed” operational and execution capabilities. The outcome is how entrepreneurs can become effective "CEO Entrepreneurs"! At Ephor we call this “Solving the Value Equation”. Paradigm of Change. Historically this “skill deficiency” issue has been solved by retaining functional/domain operators and consultants to temporarily provide these needs via a “bottom up” or task oriented approach. In the “new economy” this approach has frequently failed. What has proven successful is a “top down” holistic approach that builds the long‐term capability and capacity of the organization. Additionally, advisory boards or formal board of directors have proven likewise generally ineffective due to the “emerging business leader” simply does not have the time or skill requisite to manage and facilitate effective outcomes from a “pool of resources.”

Desired Outcome. Help the CEO Entrepreneur to make: Vision a Reality.

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This approach makes growth realistic and presents a high probability of success for entrepreneurs to not only start their business, take the core idea and transform it into a validated business, grow it, but also to be able to shepherd it to it a wealth creation outcome. Being a successful leader requires many of the fundamental gifts and talents of an entrepreneur such as: Passionate and Confident Belief, Ability to Build and Lead a Team, Creativity, Inspiration. Entrepreneurs are natural leaders, therefore given the right skill and resource support they can transition to successful CEO Entrepreneurs. The outcome is how entrepreneurs can become "CEO Entrepreneurs" and not lose their company to the mediocrity of a lifestyle business nor to VCs so that they create both wealth for themselves, and solid businesses which contribute jobs to the American economy.

Managing a private business in its growth stage with public company concepts is a recipe for disaster.

× Strategy by committee creates mediocrity.

× Management by committee creates stagnation.

× Multiple advisors cause disenfranchisement of the business model.

× Mix of lifestyle and growth vendors creates dysfunction.

× Big company decision making processes, simply have proven not to be effective for emerging, growth oriented businesses.

Strategic Change. For entrepreneurs to create wealth, they must learn to manage the company beyond its startup growth phase to successfully maximize the market opportunity.

The gap is management of the transition from a subscale business to a scaled enterprise and ultimately a market sector leader. Entrepreneurs creating wealth for others is a nice byproduct of growth, but working for themselves versus a financial backer, banker, or venture capitalist is a fundamental change required for our economy becoming more prosperous and resilient and for more industry sector leaders to be developed and succeed. Significant change of whom benefits is required to ensure America's innovation leadership and entrepreneur spirit reigns. Most businesses fail to capitalize on the original idea of their founding. In fact, less than 1% of all startups make it to year ten, and less than 1% realize a successful wealth exit. A shift from the entrepreneur viewing success as launch, to the goal of maximizing the wealth opportunity for the business is fundamental.

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The “Concept of Organizational Clarity” The Ephor Group has developed, implemented, and refined over the past 12 years the “Concept of Organizational Clarity.” This concept has been instrumental in the development and success of numerous transformational and industry sector leadership business models. Organizational Clarity has four components that must work conterminously and are mutually dependent upon each other for transformational or sector leadership and success:

5. Strategic Clarity 6. Operational Clarity 7. Tactical Clarity 8. Financial Clarity

The Outcomes of Organizational Clarity include:

A Sector Influencer or Sector Transformational Business Model Exponential Shareholder and Entrepreneur Wealth Creation Significant Economic Societal Success and Job Outcomes The Desired “Storybook Happy Ending” for all Stakeholders

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Strategic Clarity requires:

A unique Value Proposition A well-defined and differentiated Business Model A stated (and adhered to) Core Set of Values and Principals A well-defined Strategy inclusive of a Corporate Development function Highly skilled Leadership Team that utilizes “Outside Expertise” and Governance

Strategic Clarity Outcomes include:

A Branded and differentiated organization in the sector An ‘easy buy’ decision for the customers Customer clients attract referral customers A noted place to work, which attracts the best employees Significant wealth creation The “Yellow Brick Road” to achieve the desired “Storybook Happy Ending”

The Yellow Brick Road

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For the full report, please contact us @

[email protected]

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Operational Clarity Outcomes include: Revenue growth becomes a “built-in” capability of the business Significant New Clients are the result of referrals - not just direct sales Significant Client Retention & Recurring Revenue capability Employee recruiting is dominated by employee referrals Effective Internal Leadership

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Financial Clarity Outcomes include: The amount of Wealth that can be created by the “franchise” is identified Definable, predictable and repeatable financial outcomes are known Pragmatic relationships with all stakeholders are established Execution and Investment Risk are minimized Exit Optionality for the desired “Storybook Happy Ending” is prevalent