Five tips for family business succession planning
Doing this for each potential successor will help you see which ones are best positioned to move the company forward. Finding a successor with the right mix of skills, attitude, drive, character, and experience that matches your business will ensure the family company succeeds for the long term.
4. Groom the next generation. Once you have a successor in mind, offer him/her additional development through such things as job rotations, stretch assignments, additional profit and loss responsibility, and additional exposure to board members and customers. The more emphasis you place on prepping the next leader, the smoother the transition will be.
5. Consider a non-family leader. When a family business member utters the words, “Let’s consider a non-family CEO,” the first reply is usually a colorful no! However, a non-family CEO frequently brings diverse, in-depth experience to drive business growth, bringing professional alliances, partnerships, and strategy opportunities. They can be a great mentor for the next generation of family leaders—often then known as a “bridge CEO” from one generation to the next. While the family may hold all the stock, it is critical to develop a performance incentive that will reward and retain the non-family CEO and an employment agreement that will fairly treat and protect the CEO.
Choose Who’s Next
Thoughtful, on-going planning for succession is a must for long-term business success and sustainability. Therefore, start now. Develop a clear plan about the succession of senior leader positions, including who will be next, when the transition will take place, and how that successor will be groomed to make the move smoother. The more planning you do now, the better the future will be—for you and your family business.
Lois Lang is a speaker and consultant with Evolve Partner Group, LLC where she helps organizations become high performance workplaces. For more information, visit http://www.evolvepartnergroup.com or contact Lois at email@example.com or (209) 952-1143.