Family businesses overlook a robust succession plan at their own peril. The reality is you need a careful approach to prepare your family and your business for a secure future.
The 2017 Family Business Survey confirmed the majority of Australian family businesses are not adequately prepared for succession with only 9% having a retirement plan. A meagre 12% have a process in place for appointing a new CEO, yet 76% expect to appoint a new CEO in 5 years.
Not surprisingly the vast majority of family businesses have experienced tension or conflict between family members in the past year. The good news is family businesses with documented retirement plans for the current CEO are significantly less likely to experience conflict.
As a family business owner, you may want to move on and hand over to the next generation one day, but how do you do it? After all, you want a smooth transition for everyone involved.
A professional succession plan is vital for a number of reasons:
- Safeguarding the viability of your business when a key person retires or leaves,
- Ensuring a seamless handover ensuring your family relationships remain intact, and
- Providing economic security for the younger generation and financial freedom for the older generation.
Kelly Grains is one successful business who have secured their legacy.
Don’t leave it to your accountant or lawyer.
They may be managing your financial concerns and legal compliance, but do they have the people skills to negotiate a successful transition to the younger generation? Succession planning is often complicated by the sensitivity of relationships and emotions. This demands working with the stakeholders in your business, from family members and advisers to staff and clients, requiring a specific set of skills in negotiation and conflict management.
Take the first step. Ask the experts.
At Business By Design we look at your family members’ needs and expectations combined with the key business objectives to develop a succession plan for a seamless handover. Sean Martyn has a track record spanning two decades of advising and coaching businesses, and knows the unique challenges families face with a multi-generational business structure.
Book your obligation free succession discussion with Sean Martyn