BUT --- Succession planning just isn’t happening for many family-owned farms. Is it happening on your farm…with your family?
Developing your succession plan for your farm business is perhaps today’s greatest leadership opportunity. “So what’s your point, JIM!”
My goal is to motivate you to get started with your succession plan if you haven’t, to encourage you to continue if you have, to jumpstart the process if you’ve stalled or to congratulate you if you are finished!
Some ideas about succession planning to put in your back pocket and ponder…and maybe one day, take action on include:
- Succession planning is the development and implementation of a plan to transfer responsibility, operational control, leadership and ownership of the business from one generation to the next. It is logical that since the farm business usually represents over 80% of a family’s net worth, there ought to be a succession plan to manage the transition of the management and ownership of the business from one generation to the next…no?
- Succession planning is a complex process, both from an emotional and technical standpoint. It varies with each business. It is difficult because of different needs and wants of those involved – generally all competing for the same scarce resources. It often seems easier to just keep things the way they are rather than navigate through the minefield of differences…let alone having to talk about it. Yuck!
- At the start of the planning process the outcome is uncertain. With each step it becomes clearer and uncertainty is reduced. The added clarity helps generate more energy, thus providing the momentum to keep on keepin’ on.
Our experience suggests the following are helpful points to consider with any succession planning process:
- Start with the emotional and personal side of things and finish with the financial aspects. Confusion and ambiguity often cloud the process if done in the opposite order.
- Involve EVERYONE in the process at some point. Owners, managers, on-farm family, off-farm family…and yes, even the in-laws! Your family and team will likely be more willing to accept the final outcomes if they have had some input into the process.
- Don’t worry so much about where you are in the process but make sure you are moving forward.
- Succession planning involves choices. Choices can be characterized as perfect, acceptable or unacceptable. If you don’t understand and accept these characterizations, decision-making can become frozen and the planning process will stall.
- Stay centered up with what is best for the business. This may or may not be what is best for an individual or one of the families…but generally, what is best for the business is best for the family…and each of its members.
- If the process is stalled, look for the emotional rather than the rational reason why it stalled.
- Listen, learn, and understand. Don’t judge another person’s position.
- Use financial information to take some of the emotion out of the decisions that need to be made.
Someday…maybe soon, or maybe many years in the future, there will be a discussion about your legacy and your contribution toward to your family and your family business. Today’s leadership opportunity enables you to have the most positive influence possible on that legacy. Think about taking it and leading the succession planning conversation and process. Best of luck.