The HBO series Succession is a dramatization of the transition of a business from one generation to the next, a morality tale about what can happen when a Generation 1 owner fails to create a coherent plan to pass a business to members of Generation 2. It has been successful with both critics and audiences, receiving nominations for 25 Emmy awards. Millions of viewers have watched the Roy family do everything wrong, destroying relationships while driving the family business to the brink of disaster.
Succession planning done right may not make for must-see TV, but it does keep important relationships intact and positions successors and companies to succeed.
Business ownership is certainly one of life’s most exciting endeavors, and it can be difficult to imagine the day when you are no longer at the helm. Yet unless you decide to liquidate your company, someday you will transition your business to new leadership. You can follow the lead of a TV series anti-hero and see what happens or you can take charge of your transition, create a succession plan and gain the peace of mind and legacy that you deserve.
Business transitions are high-risk endeavors
Business transitions, especially intergenerational transitions, are tricky for several reasons. First, they always involve emotions. Lots and lots of emotions. Second, they always affect relationships, and third, everyone concerned has an opinion. Fourth is their unpredictability. While creating a roadmap for your transition, you will make many decisions without knowing how those decisions will play out. You may even find that your successor’s goals do not match yours.
How can you improve the odds of a successful transition? That answer involves multiple elements, including your ability to transition from leader to teacher, your successor’s willingness and ability to lead and your company’s financial capacity to support a transition. For now, let’s look only at four basic steps you can take today to improve your odds of transition success.
Four steps for successful transitions
- Know what you want your transition to achieve. Owners who can imagine meaningful post-business lives find it far easier to put in the work successful transitions require.
- Know your deal breakers. Just as you define your ideal outcomes, define your lines in the sand. What objectives will you not sacrifice? Knowing your deal breakers reduces the number of options you must consider and consequently prevents you from wasting valuable time and energy.
- Begin to prepare your business to succeed without you. If your company’s success relies on your knowledge, talents, rainmaking ability, business relationships, financial backing or identity, take steps to reduce this dependency. Are there tasks you can transfer to others? Can you craft your marketing programs and press releases to focus less on you and more on your company’s strengths?
- Start business succession planning now. The longer the runway is between the day you begin to plan and the day you leave your company, the more options you have. Give yourself time to pivot when conditions change, or people change their minds or react in ways you don’t expect.
I’ve learned through long experience with thousands of owners that these four steps — steps you can take today regardless of whether you intend to transition your company to a family member, key employee or outside third party — improve your odds of a successful transition. The Roys may be fun to watch, but you don’t want that kind of drama in your life.
Elizabeth Ledoux is a co-author of the award-winning It’s A Journey: The MUST-HAVE Roadmap to Successful Succession Planning, as well as Accelerate Your Entrepreneurial Flight and Understanding the Growth of the Entrepreneur. She frequently speaks to organizations and business owners about challenges and opportunities in private and family business transitions, business and individual growth, and the business succession journey.
She serves as Chair for TIGER 21 in Denver, Colorado and was Chair for 14 years of the Women Presidents’ Organization’s Denver chapter.