Methodology

The Research Behind Hexiss

Built on evidence. Designed for decisions.

Every question in the Hexiss assessment traces back to research on what decides whether a business survives, transfers, and holds its value.

This isn't another business checklist. It draws on decades of research in business failure prediction, organizational resilience, operational systems, ownership transition, and transaction data, narrowed to the conditions that consistently shape readiness.

The foundation

A systematic review.

Built from a structured review of 58 sources, graded by strength of evidence.

Research and market data answer different questions, so Hexiss keeps them separate.

Strong Evidence

Replicated and official research

Examples
  • Business failure prediction research
  • U.S. Bureau of Labor Statistics survival data
  • SBA economic research
Market Evidence

Real-world transaction and practitioner data

Examples
  • IBBA Market Pulse
  • Pepperdine Private Capital Markets
  • Exit Planning Institute research
Review Standards

Methods used to maintain discipline

Example
  • PRISMA 2020 reporting guidelines
What research consistently shows

How the Questions Were Chosen

Each question measures a pattern that research has repeatedly linked to stronger business outcomes.

Financial health is the strongest survival signal.
Cash generation, meeting obligations, and absorbing pressure are among the most consistent predictors of survival. That's why Financial Health carries the most weight.
Failure prediction research (Beaver; Altman)Strong
Closing a business is not the same as failing.
Businesses close for retirement, strategy, or owner choice. Readiness isn't about preventing change. It's about having options before circumstances remove them.
U.S. Bureau of Labor Statistics survival data; census analysisStrong
Owner dependency limits the value of everything else.
A business can have strong revenue and loyal customers and still be fragile if decisions, relationships, and knowledge sit with one person. Buyers and successors value it less.
Wasserman (2012); IBBA Market PulseModerate–Strong
The principle behind the model

Owner dependency is not a domain. It is a ceiling.

It doesn't describe one area of the business. It limits how much value the other areas can create. Hexiss measures it through leadership and operational questions, then applies it as a limit on the domains it affects most.

Systems create transferability.
Knowledge in documented processes survives a person leaving. Knowledge in someone's head leaves with them.
Knowledge transfer and operations researchModerate–Strong
Customer concentration creates continuity risk.
A major customer can be both an asset and a vulnerability. Too much revenue in one relationship raises disruption risk and lowers appeal to buyers.
IBBA Market Pulse; transaction researchModerate
Most owners plan to transition. Few are prepared.
Many owners expect to exit eventually. Far fewer have documented plans or developed successors. The gap isn't intention. It's readiness.
Exit Planning Institute researchModerate
Why these questions

Seven domains. One readiness model.

Every question in Hexiss belongs to one of seven areas research links to business readiness.

01
Financial Health
Whether the business is financially stable, predictable, and able to absorb volatility without disrupting operations.
02
Leadership & Succession
How decisions are made and delegated, how authority is distributed, and whether anyone is prepared to step into the owner's role.
03
Operational Independence
How much of the business runs on documented, repeatable systems versus specific individuals.
04
Customer & Market Position
Whether growth is intentional and sustainable, driven by positioning, retention, and reputation rather than constant chasing.
05
People & Culture
How consistently the team performs and executes through pressure, change, or the owner's absence.
06
Direction & Focus
Whether a clear direction translates into aligned priorities, resource allocation, and daily execution.
07
Risk & Continuity
How well the business withstands disruption: client concentration, staff turnover, market shifts, insurance gaps, or operational breakdowns.
Domain weighting

Each domain is weighted by its impact on readiness.

Financial Health
Leadership & Succession
Operational Independence
Customer & Market Position
People & Culture
Direction & Focus
Risk & Continuity
.Lower weightHigher weight

Weights are the same for every business.

How scoring works

Enough structure to trust the read.

Hexiss doesn't give a single grade. One number can hide what matters most. Strong finances with heavy owner dependency is a very different business from average finances with strong systems.

What owners receive:

A condition band for each domain
A readiness profile across the business
A prioritized 90-day plan
The boundaries of the model

What the assessment is designed to measure.

Hexiss is an evidence-informed read on business readiness, not a guaranteed predictor of future outcomes.

A screening tool

The Stress Test is a screen, not a full diagnostic.

Its 24 questions give owners a fast, directional read across all seven domains and a clear place to start.

The model does not currently claim:

Statistical validation of the instrument. The questions show content validity by mapping to established research. Predictive validation needs response data collected over time.
A certified owner-dependency scale. The effect of owner dependency is well supported. Hexiss applies it as a model limit, not a separately validated scale.
That market data equals scientific proof. Transaction and survey research is labeled as market evidence.
That widely cited estimates are exact. Survival and transition statistics have definitional and sampling limits, and Hexiss presents them with that context.
Where to next

See it for yourself.

Screening

Take the Business Stress Test

24 questions, about 10 minutes. A fast read across all seven domains and a 90-day plan for what to fix first.

Get your 90-day plan For advisors

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