Are you accidentally putting your next generation at risk?
No one wants to think that their successors would be in harm's way of any kind, as a matter of fact, most leaders of family businesses are actively working to ensure that the next generation is not at risk. Who would want otherwise? But there are certain conversations that need to happen, or it can put the next generation at substantial risk. Let's take a look at one of those conversations. Kelly Lector and Jennifer Pendergast, the authors of the book Roadmap, offer a thought that there is a single critical theme that must be handled properly, if a succession is going to be successful. That theme is Shared Vision. The overriding theme of the book is that it is critical to invest time and resources to develop a vision for the future of the family business, and it should be started sooner rather than later. But this kind of vision casting is often overlooked by business families for five great reasons:
It's not action oriented — it doesn't seem practical and it seems like a waste of time
It typically doesn't solve a particular problem at hand
Many families don't know how to do it, what questions to ask, who should be involved, or who should lead it
Sometimes there's a fear of asking big questions in case stakeholders [including children in the business, sibling partners, etc.] have different answers
They fear conflict – avoiding the conflict is much easier than facing it
These are good reasons. Unfortunately, not facing them can put succession at risk. It's better to clearly understand the motivations of all the constituents sooner, rather than later. What would happen if you reached a crucial moment in the succession, only to discover that someone has a completely different goal? If there is uncertainty in the business succession with the owners, it will affect all stakeholders. Clarity of vision helps ensure confidence for everyone involved. So what kind of questions would you ask if you wanted to arrive at a shared vision? Here is just a handful:
What are we trying to be as a family? As individuals? As a business?
How will we know when we've achieved it?
Why is it important for us to own this asset together? Is it because it's profitable? It keeps the family together? It is our heritage and our purpose?
Under what conditions would you sell?
Is it important that a family member lead the business?
You may want to consider having some conversations with stakeholders, having a family meeting, surveying stakeholders, and becoming more prepared to take on hard questions. If your values, principles, and vision are aligned, you can likely have a shared vision and smoother continuity. If you have different values, different principles, and a different vision, perhaps you can’t follow the same purpose. We encourage you to start a process of continuity planning, not just succession planning. Succession implies a single event, while continuity implies an ongoing process. Plan the future by involving people who will be a part of it. Do you have a shared vision?
