In a constantly evolving world, arguably the only kind of tradition that matters is the tradition of flexibility. Monopolies, specialist expertise and economies of scale aside, sources of net value may be fleeting. But flexibility is there for the long haul.

So why not make your business strategy and entity goals about not just building value. But building flexibility too? Building additional value, subtracting poor value and building access to value are three ways to boost the sale price. Building flexibility (to handle future uncertainty) is a less obvious 4th way.

Meanwhile, a message for private equity investors and institutional fund investors is to invest in companies with strong business flexibilities, for greatest investment returns. It also follows that if potential buyers cannot value the business flexibility features of a potential investment, but you can, you’ll buy from sellers (who don’t value the business flexibility either) at a bargain price!

For the Board, getting your organisation to build a portfolio of core competencies can enable multi-pronged growth. While building just one competency enables specialisation. Either way, building various forms of business flexibility helps you get there faster. For example, the Robert Langer approach (google search ‘the Edison of Medicine’) is to hire talent with each person having multiple PHDs to accelerate research innovation.

Finally in the M&A area, acquiring companies implicitly reference business flexibility value when they pay goodwill on acquisition. They realise that business flexibility increases the probability of a positive value outcome for them.

Simon