One arrives, one leaves, and if the one does not leave, there is one too many. That statement already says a great deal about why succession in family businesses is demanding. It takes a successor who is willing to take on responsibility, and it takes an entrepreneur who is willing to place responsibility in their successor's hands. The path there is decisive, because it is bound up with answering a large number of questions. Engaging with succession systematically and early secures success, even if the outcome will most likely look different from what was expected.
Getting started: creating the foundations
Every family business is different and every entrepreneurial family is different. What helps every entrepreneur to shape succession is a systematic approach. That requires systematic engagement with the subject. Everything is succession. With that conviction it becomes clear that succession aspects play a role right at the start of your own entrepreneurial activity. Concepts for emergencies will be to the fore there. The basic idea of protecting the company, its employees and the entrepreneurial family as well as possible in an emergency carries over into questions of age related succession too. That may sound exaggerated, but it is about the future viability of the company and about securing assets beyond your own lifetime.
Succession takes time: what are your goals?
The owners bear responsibility for the company. They shape the strategic framework in which the entrepreneurial objectives are set. The focus on the classic strategic questions of the business inevitably widens to include questions about the owners' strategic objectives. Among experts this is referred to as owner strategy, which deals with the owners' objectives and how they exercise their responsibility for the company, its employees and the entrepreneurial family. We take the view that every company and every owner needs an owner strategy in order to clarify the elementary foundations of their own entrepreneurial responsibility, regardless of the size of the business. Defining the objectives leads to the possibilities for succession from the owners' point of view and therefore to the succession strategy.
Expectation: the right decision
The entrepreneur's objectives are important. They make it possible to work towards identifying a successor who is willing to take on responsibility and to adopt and develop the existing owner strategy. Does that person or group of people come from the family or from outside? This is where the sheer variety of topics that owners and entrepreneurs can be confronted with becomes apparent.
Do the children want to follow their entrepreneurial parents? If so, how can they be put in a position to fulfil the task as well as possible? When is the right moment? How will the employees in the company view this step? Or does it take management from outside the family, with the family withdrawing into the role of owners without operational responsibility? Or should the company be sold? Answering these questions is difficult, and that is why a systematic approach, a structured process, is a convincing method for resolving succession satisfactorily.
With its extensive expertise, THE MAK'ED TEAM accompanies mid sized companies in their development and therefore in questions of generational change and succession too. Establishing owner strategies and succession strategies is a firm part of THE MAK'ED TEAM's projects.
You can find more on succession and emergency planning here.
.avif)
