The Intricacies (and Emotions) of Succession Planning
In a family-owned business, there are myriad dynamics at play.
For mid-sized and smaller businesses, especially those that are family-owned, future leaders of the company may have been assumed based on an unplanned order of succession. But what if the best leader for a top job isn’t someone who has the same last name, shared genealogy, or common company experience?
Optimum leadership succession, like a successful operation, requires an unemotional approach to finding the right person for the job, with an eye towards the continued growth and success of the enterprise. It requires an intimate appreciation of the candidate’s experience, skill, knowledge, and track record. It demands an understanding of the candidate’s own career preferences.
If the only concern of a business owner is determining who is best to sustain the vitality of the business, then choosing a successor does not necessarily have to be so complicated. Yet anyone who has ever worked for a company of long-tenured employees, or for a family business, understands that there are certain dynamics of the culture that are unique.
Inherent to a family business is the commitment to the family, a reverence for family and business history, and a regard for legacy. All these factors bring consideration for other family members and the complexity of emotional relationships. And in addition to family members, it’s common that the head of a family business will also hold a particular allegiance to the employees that helped build the business (they’re “like family”), as well as to the community that supports the business.
In determining the right, next leadership, these emotional realities need to be addressed and navigated against the backdrop of what’s right to sustain the business and protect the family.
This is where an objective third-party consultant, who is not emotionally involved, can be an invaluable resource.
Stan Davis is the Founding Principal of Standish Executive Search, a New England-based firm that advises business owners, executives and boards who are positioning their companies for accelerated growth, change or succession.