Businesses Are Worth More When They’re Systemised

When it comes to selling a business or attracting investors, revenue alone is not enough.

Sophisticated buyers look for a business that is built to last, easy to operate, and ready to scale. That confidence does not come from the sales pitch… it comes from Systems.

Whether your exit strategy is selling the business or holding on to it as an asset, while making yourself obsolete, systemisation is the key ingredient to a lucrative exit formula.

Operational excellence is not just internal hygiene; it is a key driver of valuation. Systems lower key-person risk, starting right at the top: if the founder’s departure can cause operations to unravel, sales to take a nosedive, and culture to falter…they are the real asset, not the business itself. Systemisation can also speed up due diligence, and position the business as a premium asset in the market.

Here’s a few thought-starters on why and how building your business as a System strengthens its future valuation, and exactly where to start.

Systems reduce risk for investors and buyers

Risk is the number one reason valuations drop in a sale process.

Buyers assess how dependent the business is on specific people, undocumented processes, or founder knowledge. The more a business looks like a "black box" only the founder can run, the lower its price will go.

Systemisation signals operational maturity. It shows a business that can not only survive but flourish without A players (including the founder themselves) holding it together.

A SIMPLE ACTION TO START FROM:

List the top 5 critical processes that currently live only in people’s heads. Pick one. Write a simple step-by-step guide for how it works.

It needs to be clear enough for someone brand-new to the business to follow it. Start building your operations manual one process at a time. Most importantly, after the first one is done: keep going!

A MORE ADVANCED APPROACH:

Existing documentation might already exist: but when was the last time it was reviewed? Continuous Improvement is absolutely essential for a systemised business. Changes can come from anywhere, from a new piece of technology to evolving customer needs, and micro-adjustments to processes happen everyday. Reviewing and updating regularly is a non-negotiable.

Moreover, consider whether your documentation is about “processes” or “procedures”. More on this next.

Systems make due diligence faster and cleaner

The due diligence phase of any deal is where disorganisation is impossible to hide.

Buyers and investors will ask for financials, customer data, supplier contracts, HR policies, IP protection, technology architecture, maps of key and satellite business processes, and operational manuals (“processes” and “procedures” are two very different things!).

Procedures: think how-to-guides, manuals, SOPs, tutorials, checklists , etc. They list in detail what needs to happen when, and how to achieve it. They often specify what piece of technology needs to be used and can be in written, video or visual format. Tango and Loom are excellent tools for this.

Processes: think a map of how business processes flow. Mind maps, flowcharts, process maps. How departments are interconnected. How data flows. They are outcome-based and input-output-driven. Lucidchart or Miro are dedicated options, but no matter the tool, it’s keeping it simple and clear that gives them value.

If all of the above is in disarray, hard to find or poorly documented, trust will erode as fast as a gazelle at lunchtime.

Systemised businesses do not just survive due diligence. They impress.

HOW TO APPROACH THIS:

Create a System for your Systems: start documenting how your business runs, beyond the basics role-based how-to guides AKA procedures. Run a mini-audit every 12 months: if you were a potential buyer of your business, would you go ahead?

If you’re getting close to a potential valuation, create a single, organised digital folder labelled "Due Diligence Ready". Start dropping in key documents: financial statements, client contracts, staff policies, and supplier agreements, and regularly revisit this for accuracy.