Business governance isn’t a topic that excites most business owners until something happens that makes them wish theirs had it. As transition strategists, however, governance excites us because it is a critical element in the success of a business as it is transitioned from one generation to the next. In this article, we look at the objection we hear most from owners: We’re doing just fine making decisions the way we do. Why bother with family business governance? When Informal Governance Works, It’s Great! We’ll concede the point that some
One of the tools we use to help business owners organize their transitions out of their companies and onto their Next Adventures™ is The Big 6™. An owner’s answers to these six questions create a compass that guides them as they progress in their transition journeys. We’ve written about these questions and how they relate to owners. Today we turn the tables and share our answers to The Big 6 succession planning questions. The Big 6™ As a quick reminder, here are the six questions every owner must answer as
Several years ago, I witnessed the catastrophic results of a business transition gone terribly wrong. A once thriving company liquidated only two years after the celebratory toasts to new ownership, and a father, son, and entire community found themselves living under the cloud of transition failure. These sad and entirely avoidable outcomes were the products of unspoken expectations, a lack of planning, and a reluctance to ask for help. Joe Watson (not his real name) was a brilliant aeronautical engineer. He held multiple degrees, including an MBA, and scores of
Business owners often tell us that every time they think about transitioning out of their companies, they get stuck. To evaluate the severity of their “transition paralysis,” we ask: Does your business transition keep you up at night? The typical answer is something like “It’s hard to sleep when I don’t know which step to take first. There are so many moving parts, so many people involved, and so much at stake.” And our typical answer is, “You’re right.” It’s not easy to leave your company in the hands of
It’s my life’s work to help business owners create transitions out of their companies that meet their most important goals, keep their relationships intact and position their companies to succeed under new leadership. That’s a tall order, and no transition is as perfect as owners envision because, more often than not, one of their goals (or more) conflicts with others. Then what? Let’s look at a father-daughter family succession case study. From Simple to Complex: A Father-Daughter Family Succession Case Study Owner Greg and his daughter Lisa (not their real
I’ve written in this blog about communication during business transitions. Productive dialogue between owners and successors, owners and spouses and owners and key stakeholders isn’t easy but it’s a requirement for successful transitions. In this post, I will describe how you can use your succession plan to keep your promises. Effective Communication From long experience, I’ve developed four guidelines for owners who want to communicate effectively during and throughout the succession planning process. Prepare for conversations. Know what information you want to gain from the conversation and what information you
In The Dance of Business Successor Development, we described the three phases of teaching and mentoring successors. In Phase 1, owners lead, and successors follow. In Phase 2, owners and successors alternate the lead, and in Phase 3, successors lead, and owners follow. The trickiest part of the dance is Phase 2 because when successors begin to assume greater levels of responsibility, they make mistakes and owners must let them. It’s awkward, and miscommunication and misunderstandings are almost inevitable. That’s why we developed three rules of engagement for successor development
When was the last time you thought about how you do what you do to make your company successful? If you are like most owners, the answer is “I don’t think about how I do what I do. I just do it.” Part of succession planning, however, involves teaching a successor to do what you do. We call this phase of succession planning “The Dance of Business Successor Development.” The Dance of Business Successor Development Before the dance begins, you create a curriculum meaning you break down what appear to
Have you ever imagined that the transition out of your business could be the capstone of your career as a successful owner? Or do you think of the succession planning process only as contingency planning for your retirement? For a moment, consider the possibility that business succession planning can lay the groundwork for your next adventure and ongoing success of your business and all those who depend on it. First, the transition of a business is not just a one-time event. It is a journey that involves owners, their families, successors, and companies. Second, the business succession
