Why do some farm families take on the task of succession planning?
Does it depend on having knowledge about the process?
Does it depend on understanding the consequences associated with taking…or not taking…action?
There is no cookie-cutter template to follow when it comes to succession planning. As cliché as it sounds…every family business is truly a unique business with unique individuals and unique circumstances....including yours. While there are several components that each succession planning process should usually address, they vary from one business to the next.
Succession planning is a process -- not an event. The planning process should begin soon enough to allow you enough time to gather information, make decisions and take action. But not too soon...like when Junior is still running around in diapers. When the time comes, and you'll know, partnering with a neutral third party to guide you down the planning process can be important for a few reasons:
- A third party advisor is more able to fully dedicate their time to your business plan
- Family members and/or management are busy running the “the business” and are often distracted from the succession planning process
- A neutral third party advisor does not advocate for one any person or groups of people, but rather for the succession of the “family business unit” itself.
You and your family make the decisions while the advisor has the skills and experience to guide you toward agreement on complex issues. Someone that is familiar with your business, your type of business or who has served in this role for other family business are key in helping you choose the right facilitator.
The next newsletter will look at decision making processes, business assessment, identifying future leader(s)/management, required skills, working arrangements, entering and exiting family members’ financial needs, a workable time table, implementation, review/feedback, adjustments.
Yup, there’s a lot to it. It takes time. Small bites will enable you to consume, overcome and reach something that could not be done in one herculean effort.
There is an often quoted joke or saying; “How do you eat an elephant? Of course...."One bite at a time!" While that appears obvious and it may not be new to you, a slight addition could bring it a whole new meaning to you…
How do you eat an elephant? By taking small bites out of your elephant and taking the right bite at the right time.
To determine what bite you need to take first, you need a strategy. With a defined strategy, you can choose where to start. Finally and most importantly, a strategy will help determine what you want your elephant to look like and how and who you want to share in the feast. A planned strategy will help keep you focused on the objectives and final results…not the work at hand.