Have you created an estate plan even though you have no intention of leaving this earth anytime soon? Making the appointment with your attorney probably wasn’t high on your list of “fun things to do,” but you did it — partially for tax reasons, perhaps, but ultimately out of love for the people and causes you care about. You now enjoy the comfort that comes from knowing that those you love will be taken care of.
Planning to transition out of your business is another action item that may not appear on the top of your priority list, but it is a step that owners take ultimately out of love for the people they care about, both inside and outside of the company. Estate and business succession planning share another feature: In both, we know when someone has taken action too late. But is there really such a thing as too early? It comes down to how you think about it.
Estate and business transition planning differ in one important respect: mindset. Business transition planning requires you to adopt a new way of thinking. Why not start today?
1. A change of mindset
Business succession is not (or doesn’t have to be) a one-time event. It can and should be a journey — one of the greatest projects and achievements of your business career. It is a privilege for the owner of a successful company to create a vision and a transfer plan that generates successful outcomes for you, your company, your successors and your family. For many of us, recognizing that privilege is a huge mindset shift.
2. More time equals more options
When she was in her nineties, my grandmother told me that as she aged, time moved faster. She fully expected that by the time she reached 100, a year would seem like a day. When owners tell me that they will begin to plan for the transition out of their businesses at some point “down the road,” I wish I could introduce them to my grandmother.
3. Overwhelm is common but avoidable
I cannot count the number of business owners I have met who have put off even thinking about the eventuality of transitioning their companies to successors simply because they have more questions than answers. As soon as they begin to consider how they will make the transition in a way that does not damage relationships with people they care for, they become completely overwhelmed and paralyzed. Without access to a principle-driven transition planning process, they remain stuck in the web of possible answers for years. As time passes, of course, their options diminish. At the end of the day, you don’t have to have all the answers. Simply start to ask the questions.
4. Come on in — the water’s fine
When it’s done right, business succession planning generates remarkable outcomes for everyone involved. If you just aren’t ready to dive into the planning process, stick a toe in the water. For example, you can start by recognizing the incredible opportunity you have to put a successful business in the hands of someone whose dream is to own a business.
Ultimately, it’s important to keep in mind that not knowing all the answers before you begin is the norm — not the exception.