Pessimism Eases; Small Business Confidence Holds [WSJ/Vistage Jan 2026] (5 Minute Read)
January 31, 2026
By: Anne Petrik
As small businesses enter the new year, the tone is measurably less optimistic than it was a year ago. However, confidence has steadily improved since November, driven by positive expectations for business growth.
The WSJ/Vistage Small Business CEO Confidence Index held at 94.1 in January, in line with 94.3 recorded in December and more than 8 points above the 12-month average of 86. Small businesses have adapted to uncertainty and recalibrated, capitalizing on the moderate growth forecasted for the year ahead.
Overall confidence of small business leaders is driven by positive expectations for their businesses in the year ahead; 67% expect increased revenues in the year ahead, and 56% expect increased profits. These forward-looking indicators have been stable over the last three months, suggesting a slight acceleration in demand.
Revenue and Profit Expectations Strong as Marketing Investments Diversify
As small businesses explore how to leverage generative AI, marketing often emerges as the starting ground.
Nearly a third of small business leaders indicated they took advantage of new avenues to reach customers. From new events to new technology, 30% of small business leaders report incremental marketing spend in 2025 to capitalize on these opportunities.
Looking ahead, 43% of small businesses plan to increase their marketing spend in 2026. Our analysis of open-ended responses about why budgets are increasing reveals three clear themes.
1. Growth Goals: Expanding Market Share, Client Base, and Revenue
Many small business leaders cite growth ambitions — whether through gaining market share, increasing revenue, or scaling products — as the key reason for their increased marketing budgets in 2026. Chris Sutton, principal of Sutton Engineering in Plano, Texas, captures this sentiment simply: “Planning on growing and more than doubling this year.”
Marketing budgets are often increased to support new products, services, or market expansions as part of overall growth strategies. Investments are dedicated to launching new offerings (especially tech and AI), entering new geographies, or diversifying client segments. Despite economic headwinds, many remained committed to their expansion plans. As Ellie Puckett, CEO of Resonate Recordings in Louisville, Kentucky, explains, “We are in growth mode despite economic conditions.”
2. Strategic Marketing Overhaul or Formalization
Small business leaders have also referenced either starting a formal marketing strategy or revamping their current one. The professionalization of marketing includes investments such as hiring agencies, targeting, and website refreshes. There is also a focus on building content pipelines, supported by the addition of tools such as AI and CRM.
CEOs cite that investment decisions were driven by new leadership, changing conditions, and post-pandemic shifts in the market and among customers.
Part of this professionalization starts with marketing companies that recognize the opportunities presented by AI and are leaders in bringing these capabilities to their customers,” says Kathryn Courtney, President/CEO of Mix Consulting, a Seattle-based marketing firm. Courtney says she recognized the need to become AI-savvy partners to their customers early, leveraging the tools to deliver more effective marketing solutions. “We recognized early on that our choice was to get ahead of it or to be behind it,” she adds.
3. Response to Competitive Pressure or Market Conditions
Increased marketing budgets also represent a defensive move for small businesses, as they strive to stay relevant, counter sluggish demand, or capitalize on competitors exiting markets. The urgency is clear in responses like this from Jerry Green, President/CEO of Prestige Contracting in Poway, California: “Our backlog is shrinking, so we will need to increase our marketing budget.”
January Highlights
The January 2026 WSJ/Vistage Small Business CEO Confidence Index was calculated from an online survey sent to CEOs and other key leaders who are active U.S. Vistage members. The survey, conducted between January 5-12, 2026, collected data from 335 respondents with annual revenues ranging from $1 million to $20 million. The Index is calculated based on favorable minus unfavorable responses from this set of standard questions, plus 100, anchored to June 2012 = 100.
· Current Economy: Sentiment about the U.S. economy compared to a year ago continues to improve; the proportion of small business leaders who believe it is worse than a year ago has dropped from 43% to 34%. Optimism improved marginally, with 24% of small business leaders reporting improvements, up slightly from 22% last month.
· Future Economy: Forward-looking sentiment among small business leaders also continues to creep forward as over one-third (34%) believe the economy will improve, while 23% believe it will worsen in the next 12 months.
· Revenue Projections: Just over two-thirds (67%) of small business leaders anticipate revenue growth in the year ahead, and 10% expect declining revenues.
· Profitability Projections: The proportion of small business leaders who expect increased profitability rose to 56%, while those who expect declines is 16%.
· Fixed Investment Plans: Plans for fixed investments remain unchanged among small business leaders: nearly one-third (32%) plan to increase fixed investments in the next 12 months, while 13% expect to scale back.
· Workforce Expansion Plans: Half of small business leaders indicate plans to add staff in the next 12 months. Just 7% plan reductions in force in the year ahead.
To explore the full January 2025 WSJ/Vistage Small Business data set, visit our data center or download the infographic.
The February 2026 WSJ/Vistage Small Business CEO Confidence Index will be calculated from responses to the monthly WSJ/Vistage Small Business CEO survey, conducted from February 2-9, 2026, from Vistage member companies reporting $1-20 million in annual revenue.
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By: Jackie Dube Most organizations are moving fast with AI adoption- maybe faster than their teams are ready for. The result is a workplace split in two. Some employees are “Shadow AI” power users , experimenting with every new tool they can find to speed up their workflows. Others are hesitant, waiting for permission, or actively resisting the change. Managers, meanwhile, are setting different expectations across departments. One team is encouraged to innovate, while another is told to stick to legacy processes to avoid risk. This is AI fragmentation : a state where inconsistent adoption creates invisible walls between teams, eroding trust and collaboration. If left unchecked, this fragmentation doesn’t just hurt efficiency; it breaks your culture. Here is why that happens and how HR leaders can act as the “Connector” to fix it. Why AI Adoption Fragments Workplace Culture Technology transitions often expose existing cracks in an organization’s foundation. AI is unique because of the speed at which it is entering the workforce. According to recent research from HBR , when leadership doesn’t set clear norms, employees create their own. This leads to two distinct cultural risks: 1. Th e “In-Group” vs. “Out-Group” Dynamic: Employees skilled in AI may feel superior or frustrated by their slower colleagues, while those less comfortable with the tech feel left behind or threatened. 2. T he Erosion of Psychological Safety: When rules are unclear, employees hide their AI use (Shadow AI) for fear of being reprimanded, or they refuse to use it for fear of making a mistake. As we discussed in our AI at Work Survey breakdown , the biggest barrier to adoption isn’t technical skill…it’s trust. If trust was already shaky before AI arrived, fragmented adoption will expose it immediately. The Solution: HR as “The Connector” To prevent this drift, HR must step into the role of The Connector . In our ebook 5 HR Superpowers for the AI Era , we define the Connector as the ability to foster psychological safety and open communication during times of tech turbulence. The goal is to move away from “managing tools” and toward “aligning people.” The solution starts with standardizing principles instead of just standardizing tools . When you align teams on why and how we use AI, rather than just what software to buy, you create the consistency that restores psychological safety. 3 Steps to Realign Your Culture How do you move from fragmentation to cohesion? Focus on these three areas: 1. Establish “Rules of the Road” Don’t leave managers to guess. Create clear, company-wide guidelines on: When it is appropriate to use AI (e.g., brainstorming, drafting). When human judgment is non-negotiable (e.g., final decision making, sensitive feedback). What “good work” looks like in an AI-assisted world. 2. Democratize Training Per our survey data, 68% of employees want training opportunities more than they want job guarantees. They don’t just want safety; they want utility. When HR invests in development for everyone, not just the tech-savvy, it signals that no one is being left behind. This turns AI from a threat into a shared learning journey. 3. Encourage Open Experimentation Poor communication that people used to work around becomes impossible to ignore in an AI world. Create safe spaces, like internal hackathons or “prompt sharing” channels, where failures are viewed as learning opportunities rather than compliance breaches. Conclusion Done right, AI doesn’t have to fragment your workplace. It can actually strengthen the connections between people- but only if HR treats adoption as a psychological safety challenge first and a technology challenge second. The human element becomes more critical, not less , as technology advances.
Gavin Bell had achieved the freelancer dream. He was known as “the Facebook ads guy” in Edinburgh, pulling in £30k/month with almost no overhead. It was incredibly lucrative. It was also a trap. While rewarding, his business was completely unsellable. His customers weren't buying an agency—they were buying Gavin. The wake-up call came when his accountant asked a question most owners avoid: "Are you building a lifestyle business, or a company you can sell?" Gavin realized that a personal brand is impossible to transfer. If the company was Gavin, there was nothing left when he stepped away. So, he made the radical decision to dismantle his successful freelance operation and rebuild it into a sellable asset. Here is the four-step blueprint he used to remove himself from the revenue engine: Turning a Lifestyle Business into a Sellable Company Step one was a clean break. Not a name tweak, but a new brand: Yatter. He hired a branding agency to create the name, tone, and look. As a marketer, he could have done it himself. He didn’t want the option. The spend forced commitment and reduced the odds he’d drift back to the easy path: selling “Gavin.” Step two was the pivotal change: sales moved off the founder’s desk. Gavin met a salesperson at a conference who already understood digital marketing services. They started commission-only. While finding a skilled rep willing to work for pure commission is a unicorn hunt, Gavin struck gold. It created low risk for the business, high incentive for the salesperson. The results were better than when Gavin did the calls himself, and the handoff stuck. With sales covered, Gavin could spend his time generating leads and improving delivery instead of living inside every deal. Step three was getting off the tools. He hired an account manager, then did something most owners rush: he staged the transition. Clients didn’t wake up one day to a new face. Gavin eased the team member in—cc’ing emails, having him run calls when Gavin was away, and gradually shifting ownership over six months until clients trusted the new relationship. Step four was the glue: productizing the service. Gavin didn’t want to feel like an agency. He wanted to feel like a product company. So, he named the client journey and made each phase predictable: Audit, Foundations, Research, Creation, then Management and Reporting. Each stage had timelines, checklists, and “here’s what to expect next.” What used to be a friction point— “why aren’t the ads live yet?”—became part of the process customers could understand and trust. The result wasn’t just a smoother delivery. It was a company that could run without him. When it came time to sell, buyers weren’t buying Gavin’s talent. They were buying a team, recurring retainers, and a system that made outcomes predictable. Gavin had grown the business to $1.5 million USD in revenue and successfully exited for around five times EBITDA. His system also allowed him to negotiate an earn-out measured in months, not years.
By Trent Lee — The CEO’s Sage With concepts adapted from Patrick Ungashick, CEO of NAVIX Consultants One of the most common questions I hear from business owners who are thinking about an eventual exit is this: “What exactly is a Quality of Earnings report—and do I really need one?” It’s a fair question. And it’s one Patrick Ungashick, CEO of NAVIX Consultants, has done an excellent job of clarifying over the years. His work around Quality of Earnings (QoE) has become foundational in the exit planning world—and for good reason. Because here’s the truth most owners don’t hear early enough: Buyers don’t pay for growth. They pay for confidence. And confidence shows up in one place first—your financials. Quality of Earnings: What It Really Means At its core, Quality of Earnings answers one critical buyer question: “Can I trust that these earnings are real, repeatable, and sustainable?” QoE isn’t about whether your numbers are technically correct. It’s about whether they reflect the economic reality of your business. Patrick describes it well: not all earnings are created equal. Some are durable and predictable. Others are inflated by timing issues, one-time events, aggressive accounting, or owner-specific decisions that won’t survive a transition. Buyers know this—and they price accordingly. Why This Matters in the Value Builder Framework Within the Value Builder System , Quality of Earnings sits squarely inside the Financial Performance Driver . And here’s the key insight many owners miss: The multiple a business receives is a direct reflection of the risk a buyer is willing to take on. More uncertainty = lower multiple. Less uncertainty = higher multiple. A third-party QoE report reduces uncertainty by independently validating: Revenue recognition practices Expense normalization Non-recurring or owner-specific items Cash flow alignment with earnings Sustainability of margins and profitability This isn’t about impressing a buyer. It’s about de-risking the deal . Why Smart Sellers Do QoE Before Going to Market Historically, buyers commissioned QoE studies during due diligence—and then used the findings to retrade price or terms. Today, more sophisticated sellers are flipping the script. By commissioning their own seller-side QoE , owners are able to: Validate and defend their earnings story Identify and fix issues before a buyer finds them Increase credibility and transparency Preserve leverage in negotiations Support a higher, cleaner valuation In other words, they stop reacting—and start controlling the narrative. QoE vs. an Audit (Aren’t They the Same???) This is another area where Patrick’s distinction is important. An audit confirms whether financial statements follow accounting rules. A QoE evaluates whether earnings are meaningful, sustainable, and transferable to a new owner. Many private companies don’t have audits—and don’t need them. But a QoE speaks directly to what buyers care about most: future risk. Final Thought Strong financial performance matters—but credible financial performance matters more . When your numbers are validated by an independent third party, buyers stop wondering “What’s behind the curtain?” and start focusing on growth, opportunity, and upside. That shift—from uncertainty to confidence—is what drives higher multiples. As Patrick has long taught, Quality of Earnings isn’t just a diligence step. It’s a value creation tool . And within the Value Builder framework, it’s one of the most powerful ways to turn performance into price. — Trent Lee helps business owners increase enterprise value by aligning execution, leadership, and financial clarity using the Value Builder System, Line-of-Sight, and NAVIX-aligned exit planning strategies. Learn more at www.compassleadershipadvisors.com or connect on LinkedIn : https://www.linkedin.com/in/trentrlee/
By: Robert Courser A new year doesn’t create new results. Execution does. January is when leaders find out whether their strategy is real or rhetorical. The calendar may flip, but your customers don’t care about fresh starts. They care about outcomes. And your teams don’t need another kickoff; they need clarity on what matters now. Here’s the hard truth we keep repeating: strategy is taught; execution isn’t. So January becomes your first classroom of the year. Why January Matters For Teams: The first 30 days set the pace. If priorities are fuzzy now, they’ll be chaotic later. For Customers: Your Q1 delivery shapes what they believe you are capable of this year. For Leaders: January exposes whether you can translate vision into action. Momentum isn’t motivational. It’s operational. The Common January Mistakes Too many organizations start the year with noise instead of focus: Launching “annual initiatives” before defining the few that matter most. Confusing a kickoff meeting with alignment. Measuring activity instead of outcomes. Treating Q1 like practice instead of performance. The result? A busy January… and a disappointing March. The “Line-of-Sight Q1 Lock” At Line-of-Sight℠, we push leaders to lock Q1 execution early. Use this simple checkpoint: 1. What are the 1–3 customer outcomes that must move by March 31? 2. What are the critical execution behaviors we expect weekly? 3. What will we stop doing right now to protect focus? If your strategy can’t live inside these three answers, it won’t survive Q1. January Reflection for Leaders Ask yourself: Do my teams know what winning looks like in Q1, or just what’s “planned”? Have we made tradeoffs, or are we trying to do everything again? Are we tracking execution behaviors weekly, or hoping results appear? The Line-of-Sight Commitment January doesn’t reward intention. It rewards discipline. Start the year the way you want to be remembered in December: clear priorities, aligned teams, measurable execution. Strategy is taught. Execution isn’t. We’re changing that. Robert Courser an author, speaker and CEO at Line-of-Sight. Trent Lee & Robert work together to help CEO’s turn strategy into execution. Interested in learning more or taking a free CEO execution assessment, schedule a call (put a link to my email here).
By: Sarah Wallace Ever wish your life or job had a hype-person? Someone who “gets” what you’re about, supports what you’re trying to achieve, and is the first to celebrate your latest milestone? My name is Sarah, and I am a Promoter. Here at The Predictive Index, I head up the Growth Marketing team, which affords me plenty of opportunities to tout the excellence of both our product and people. If you’ve ever come across PI content on LinkedIn, Meta, YouTube, or any of the other many channels we use as growth levers, there’s a good chance my team worked on it. But more on myself in a bit! First, let’s talk about my behavioral profile. My behavioral pattern I first took the PI Behavioral Assessment in 2023 when I applied to work at PI. The assessment reveals a person’s natural workplace behaviors according to four key drives: 1. Dominance – the drive to exert one’s influence on people or events 2. Extraversion – the drive for social interaction with other people 3. Patience – the drive for consistency and stability 4. Formality – the drive to conform to rules and structure
By: Joe Galvin Generative AI is rapidly evolving from workplace novelty to an unavoidable tool. Yet the most accurate measure of Gen AI’s impact on a company’s success still lies in its people. Ultimately, it is humans — not the technology itself — who have the power to unleash AI’s full potential. Engagement is far from a new workforce metric. Data confirms that engaged employees perform better, have higher retention rates, and generate more revenue per person than their disengaged peers. But in today’s world, being “engaged” is no longer enough – employees must also be “digitally engaged.” Digitally engaged employees not only take pride in what and how they work, but they also lead with natural curiosity. They don’t simply show up to clock in and do the bare minimum; instead, they willingly explore, experiment, and push their own limits, whether it’s the way they do their job or how they maximize their productivity. They proactively seek learning and development opportunities to gain the skills necessary to thrive, both in their current role and in future roles that AI will undoubtedly shape. They are willing to make mistakes, knowing that progress trumps perfection. It is these digitally engaged employees who are creating the playbook for leveraging Gen AI to yield meaningful individual, team, and ultimately, organizational gains. They are learning from and teaching their colleagues, driving collaboration, and improving their own performance and productivity. As they become superusers of Gen AI, they will help the company move beyond browser behavior and simple search to uncover more effective prompts, discover new use cases, and refine processes. They are building the roadmap to the workforce of 2030, which is on track to be entirely transformed by AI. For business leaders, the takeaway is clear: curiosity – not technical aptitude – is the most desirable characteristic of the modern workforce. Curiosity sustains engagement, and engagement fuels curiosity. However, hiring for curiosity isn’t the single action. While individual employees’ natural attributes help determine their digital engagement level, it also hinges on the environment they work in. The following are four simple steps CEOs can take to ensure their organization fosters digital engagement: 1. Lead by example CEOs must first follow the mantra of building individual skills. Simply put, if a leader isn’t continuously blocking out time to develop new skills, they can’t expect their teams to do so. 2. Curate curiosity Create a culture where failing fast is not only welcome – it’s encouraged and rewarded. Make it safe for employees at all levels and roles to experiment as they learn what works and what doesn’t. Provide employees with the tools, training, and clearly defined guidelines to enable them to chart the path forward in real time. And importantly, encourage employees to communicate their learnings and collaborate with colleagues to help spread best practices – innovation does not happen in a vacuum. 3. Identify the digitally engaged superstars In reality, everyone within an organization should be thinking about and experimenting with emerging technology like Gen AI at work – from receptionist to executive, summer intern to most tenured. Still, CEOs must have a pulse on the employees who are most digitally engaged within their organization. Once this class of forward-thinking employees is identified, leaders should focus on retaining, training, and elevating them. 4. Make gains measurable Rather than trying to boil the ocean, leaders should pinpoint one unique metric they’d like to move at a time. Perhaps there’s a lengthy process that could be streamlined, or a workflow that needs refreshing. CEOs can then apply intentional energy to these processes to gradually make progress across the organization in a meaningful, measurable way. As we move from AI transition to AI transformation, digitally engaged employees will be the most critical asset for any business. These individuals are poised to become the operators of workplace 2030 and beyond; meanwhile, the disengaged, disinterested, and unwilling to adapt will self-select from AI-dominant workplaces. The CEOs who can nurture employees’ curiosity and tap into their innovation will future-proof their organization not only to withstand but thrive in continued change. This story first appeared in Inc.
These days, building and curating a personal brand online is often portrayed as a key to success. Entrepreneurs are told to put themselves at the forefront, to be the face of their business, and to leverage social media to grow both their influence and their company. However, the team at Value Builder sees things differently. Data gathered from over 80,000 business owners paints a compelling picture: businesses that rely heavily on their owners’ personal brands are worth less and harder to sell. The Hub & Spoke Model: A Major Valuation Issue The core insight that Value Builder offers business owners is the concept of the "Hub & Spoke" model. In this model, the business is highly dependent on its founder—the “hub”—to drive sales, make decisions, and maintain relationships. The “spokes” are the employees, customers, and partners who rely on the owner to keep things running smoothly. While this might seem like a natural structure for many small businesses, it creates a major challenge when it comes time to sell. In businesses where the founder is at the center of everything, buyers see a higher risk. If the owner leaves, the whole business can collapse, and that risk is priced into any offer. The Data Behind the Valuation Gap At Value Builder, the team has analyzed data from over 80,000 companies through a detailed questionnaire. Business owners share financial performance, day-to-day operations, and their level of involvement in the business. The result? The average offer for a business where the owner is highly involved—the "Hub & Spoke" model—is just 2.9 times the company's pre-tax profit. For comparison, businesses that are less reliant on the owner—those with strong management teams, well-documented processes, and a brand independent of the founder—fetch an average of 3.9 times pre-tax profit. The gap is significant: 1 full turn of profit is lost simply because the business is dependent on the founder. The Impact of Personal Branding on Business Value Now, let’s consider the role of personal branding in this equation. Entrepreneurs who invest heavily in building their personal brand create businesses that are even more closely tied to them as individuals. Think about high-profile entrepreneurs who are the face of their company on social media, and in public appearances. The danger is that when the personal brand becomes synonymous with the business, the value of the company is tied to the owner’s continued presence. Buyers recognize this risk. If the business cannot function without the founder at the center, the sale price is lower. In many cases, an acquirer will demand a longer earn-out period or an equity rollover to ensure the owner sticks around post-sale. Instead of a clean exit, the owner is tied to the business for years, effectively trading one set of demands for another. The Emotional Cost of a Personal Brand Building a personal brand also has significant emotional costs. To succeed, owners must live in an online world where everything appears polished, glamorous, and often unrealistic. Feeds are full of perfect lives, luxury cars, and seemingly effortless success. For many entrepreneurs, this can create a sense of inadequacy and disconnection from what truly matters—running a business, creating value, and enjoying personal freedom. The constant need to maintain an online persona can be exhausting. Founders find themselves spending more time feeding the content machine than focusing on growing their business or planning their endgame. Over time, this lifestyle detracts from their ability to build a business that can run without them. A Smarter Path: Building a Business That Thrives Without You The most successful founders know that the key to a valuable business is not their personal brand, but the systems, people, and processes that exist independent of them. They focus on building a business that can run without them at the helm, with strong leadership, clear processes, and a brand that doesn’t rely on the owner.
From Stuck to Scaling: How One Company Boosted Execution by 26 Points By Trent Lee — The CEO’s Sage When companies hit a wall, it’s rarely because they lack strategy. More often, it’s because execution has quietly lost its footing. That’s exactly what one fast-growing, mid-sized enterprise discovered when they finally paused long enough to ask: Why aren’t we moving faster—even with a clear plan in place? The answer? They had a documented strategy, but not a healthy organization capable of delivering on it. The Reality Check: Strong Vision, Weak Execution When we first assessed this organization using the Line-of-Sight℠ Organizational Health diagnostic, their numbers told a story many growing businesses can relate to: Silos between teams Unclear goals at the operational level Inconsistent follow-through Leadership fatigue Their Organizational Health Index (OHI) came in at 54% . Not disastrous—but clearly underperforming for a company trying to scale. What We Did: Align, Equip, Execute We didn’t start with new strategy. We started with alignment and rhythm. Using the Line-of-Sight platform, we helped the executive team install a repeatable execution system. Here’s what that looked like: 1. Executive + Team Alignment Workshops Reconnected leadership to frontline teams around purpose, priorities, and roles. 2. Cascading Goals + Performance Metrics Translated strategy into clear outcomes at every level of the business. 3. Leadership Coaching Developed new habits and routines around communication, accountability, and decision-making. 4. Quarterly Reviews Kept execution from drifting by creating a cadence of reflection and course-correction. The Results: Healthier Org. Better Execution. Stronger Momentum. After just a few quarters of applying this approach, here’s what changed: OHI jumped from 54% to 80% Their weakest domain improved from 43% to 71% Their strongest domain pushed even higher—from 64% to 91% But this wasn’t just about metrics. The real transformation showed up in how the business operated: Strategy became a shared language, not just a top-down memo. Leaders communicated with purpose and held their teams accountable without micromanaging. Culture shifted from reactive to proactive. Teams gained confidence and clarity—and started winning consistently. Execution stopped being a guessing game. It became a system. Lessons for CEOs Looking to Scale If you want to replicate this kind of shift in your own organization, here’s where to start: 1. Diagnose first. Don’t assume you know where the friction is—measure it. 2. Align through action. Strategy has to live in team priorities, not slide decks. 3. Build leadership habits. Execution follows behavior, not ideas. 4. Review frequently. Quarterly rhythm = quarterly results. 5. Celebrate progress. Success is fuel—use it to create momentum. Final Thought Organizational health isn’t just a feel-good metric. It’s a force multiplier. When your structure, strategy, and leadership are aligned, growth stops feeling so heavy—and starts to feel scalable. That’s when execution becomes the norm, not the exception. Want to find your starting point? Let’s run the numbers and see where the real opportunity lives. — Trent Lee works with CEOs and executive teams who are ready to move from strategy fatigue to execution traction. Learn more at www.compassleadershipadvisors.com or connect on LinkedIn .
By Trent Lee — The CEO’s Sage™ There is a simple truth I share with every CEO: Companies built to be sold are better companies to own. Not because the owner wants to walk away tomorrow, but because the attributes that make a business attractive to a buyer also make it scalable, resilient, transferable, and profitable today. The tragedy is this: most owners begin preparing far too late. NAVIX notes that a complete exit plan must address six domains—tax, legal, financial, operational, familial, and emotional—and must be kept current. These domains do not mature on short notice. Meanwhile, Value Builder research shows that 8 in 10 owners expect to exit within the next decade , whether they’ve planned for it or not. The runway is shorter than most believe. The Compounding Effect of Early Preparation When an owner starts early, value-building initiatives compound. Some of the most powerful include: 1. Strengthening the Leadership Team A company that can operate without the owner commands higher multiples—and frees the owner to think strategically. 2. Systematizing the Business Repeatable processes reduce dependency, increase scalability, and make the business less risky to acquirers. 3. Cleaning Up the Financials Buyers reward clarity, consistency, and professional reporting. 4. Reducing Risk (Key Employees, Co-Owners, Health, Concentration) NAVIX highlights how unmanaged risks—like losing a key employee or co-owner conflict—can destroy even the best exit plans. 5. Incentivizing Growth-Aligned Behavior Owner-independent performance systems help build a culture that outlives the founder. 6. Aligning Growth Strategy with Exit Strategy Not every growth path leads to a transferable company. Early planning ensures strategic coherence and alignment with your exit needs. The Financial Multiplier: Why Value > Profit Value Builder illustrates a dramatic truth: A company that increases value by 10% may produce five times the owner benefit compared to a 10% profit increase. Owners intuitively chase profit. Sophisticated owners chase value. The Real Reward Early exit readiness delivers three gifts to the owner: 1. Freedom of choice — more options, better timing, stronger position. 2. Greater wealth creation — value compounds when given time. 3. A better day-to-day business — healthier, calmer, more scalable. You don’t prepare early because you want to exit soon. You prepare early because a company ready for exit is a company ready for anything. Trent Lee helps CEOs lead with intention—aligning people, strategy, and value so their companies grow stronger today and become transferable tomorrow. Ready to assess your exit readiness and value drivers? Start the conversation at www.compassleadershipadvisors.com or connect on LinkedIn.
By: Shefali Lohia In hindsight, 2025 may be remembered as the year talent strategy stopped being theoretical. Artificial intelligence moved from experimentation to expectation. Employee confidence wavered, but didn’t collapse. Managers were asked to lead through ambiguity with little precedent. And HR teams were pushed to connect the dots between technology, culture, and performance faster than ever before. At PI, we had a unique vantage point into how organizations navigated that complexity. In 2025, we surveyed hundreds of HR and business leaders, listened to employees grappling with AI’s impact on their roles, and observed how thousands of organizations used PI to define jobs, develop managers, and make talent decisions in real time. What emerged weren’t just trends, they were signals. Signals that reveal how talent strategy is evolving beneath the surface, and what organizations will need to prioritize in 2026 to turn workforce complexity into a competitive advantage. Signal #1: Capability is replacing reassurance as the currency of trust For much of the past few years, employee conversations around technology have centered on fear, fear of displacement, fear of obsolescence, fear of being left behind. But in 2025, the data revealed a meaningful shift. Across our HR Playbook for the AI Era research, nearly 70% of employees said that access to training opportunities would make them feel more secure than job guarantees. Even as 37% expressed concern that AI could negatively disrupt their role, the overwhelming response wasn’t to seek reassurance, it was to seek preparation. Employees aren’t asking organizations to promise stability in an unstable world. They’re asking for the tools to stay relevant. That mindset showed up not just in survey responses, but in behavior. In 2025, organizations using PI increased the number of Jobs created in our platform by almost 10% from 2024. Rather than freezing roles in the face of uncertainty, companies actively redefined them, signaling a recognition that work itself is changing, and role clarity must change with it. What this tells us: Trust is no longer built through assurances alone. It’s built through investment, in skills, learning, and adaptability. The signal for 2026: In the year ahead, learning infrastructure will become a primary trust signal. Organizations that treat upskilling as a strategic capability, not a reactive benefit, will be better positioned to retain talent and sustain performance as roles continue to evolve. Signal #2: Change works best when employees are involved, not just informed If 2025 made one thing clear, it’s that change fatigue isn’t caused by change itself, it’s caused by exclusion. In PI’s AI-focused research, 40% of employees said they want to be involved in AI decision-making, not just informed after decisions are made. At the same time, 70% agreed that psychological safety is essential to successful AI rollouts, reinforcing that how change happens matters as much as what’s changing. Encouragingly, many organizations are moving in the right direction. More than 70% of respondents said their voice is heard “often” or “always” during AI transitions. That level of engagement isn’t accidental, it reflects intentional efforts to open dialogue, invite feedback, and treat employees as participants in change rather than passive recipients of it. What this tells us: The organizations navigating change most effectively aren’t the fastest movers, they’re the clearest communicators and the most inclusive decision-makers. The signal for 2026: Next year, successful change management will be defined less by rollout speed and more by buy-in. Organizations that operationalize employee input, through clearer decision rights, role clarity, and behavioral alignment, will experience smoother transitions and stronger adoption. Signal #3: Communication is becoming a measurable competitive advantage Communication has always mattered. But in 2025, it crossed a threshold from “soft skill” to strategic differentiator. In PI’s HR Field Guide to the Future, 91% of leaders identified clear mission and vision communication as a competitive advantage, while 61% said value alignment directly predicts organizational health. Add to that the finding that more than 90% see candidate experience as essential to employer brand, and a clear picture emerges: communication isn’t just internal alignment — it’s reputation, retention, and performance rolled into one. That emphasis showed up in PI’s platform data as well. Over the course of 2025, there was a noticeable increase in users accessing PI’s Management Skills Guide — a signal that organizations are investing in how managers communicate, motivate, and lead through complexity. This matters because strategy doesn’t scale on its own. Managers do. Every organizational priority — from AI adoption to employee engagement — is delivered (or diluted) through day-to-day manager behavior. What this tells us: Communication quality isn’t abstract. It’s enacted one conversation at a time by managers who are equipped — or unequipped — to lead. The signal for 2026: In the coming year, manager effectiveness will increasingly be treated as infrastructure, not a soft skill. Organizations that invest in developing managers as communicators and coaches will create clarity that scales — even as work grows more complex. Signal #4: Strategic talent alignment is moving from theory to practice For years, organizations have talked about hiring smarter, developing people intentionally, and building high-performing teams by design. In 2025, we began to see that talk turn into action. Consider this tension from PI’s research: 75% of leaders believe technology will help offset talent shortages, yet only 29% invest in AI training, and just 13% conduct formal skills gap analyses. The ambition is there — but execution often lags. At the same time, PI’s platform data tells a more hopeful story. Over the course of 2025, more organizations began creating new job benchmarks (“Job Targets”) based on their own internal top performers, rather than relying on generic role templates. That shift is subtle, but significant. It signals a move away from guessing what success looks like — and toward defining it using real performance data. In other words, a data-driven talent strategy is moving from concept to practice. What this tells us: High-performing teams aren’t accidental. They’re designed — behavior by behavior, role by role. The signal for 2026: Leading organizations will increasingly design roles from the inside out, using evidence from top performers to guide hiring, development, and succession. The result will be more consistent performance and alignment. What these signals reveal about talent strategy in 2026 Across all four signals, one theme stands out: The future of work isn’t about reacting faster. It’s about aligning better. In 2026, organizations that gain an edge will be the ones that: Treat learning as a trust-building strategy Involve employees early and meaningfully in change Equip managers to deliver clarity at scale Define success using behavioral evidence, not assumptions These aren’t abstract predictions. They’re grounded in how organizations actually behaved in 2025. Why PI sees these signals early Trend-chasing focuses on what is loud. Our analysis is designed to reveal what is lasting. The key to this foresight is PI’s unique data vantage point. By sitting at the intersection of behavioral science, defined role clarity, effective management development, and thousands of real-world usage patterns, we observe shifts in talent strategy as they are being formed—not after they have become headlines. The signals from 2025 offer more than predictions; they provide a blueprint for a more aligned and competitive 2026. For organizations willing to act on this behavioral evidence, the year ahead presents a clear opportunity to move past uncertainty and turn workforce complexity into a powerful competitive advantage.
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