Not all business owners are eager to set up a succession plan. Some are reluctant to discuss the inevitable future, despite the wishes of their family, business partners, customers, lawyers and others.
This week, for instance, I spoke with the president of a company that has a 77-year-old owner. The president of the company told me the business remains in the day-to-day control of the elderly owner, who has indicated he intends to remain firmly at the helm until he is no longer able. This is his intention, despite the fact the company has 600 employees and many trusted and talented members of his family work there.
He is not simply being stubborn. Business owners of this caliber literally feel they cannot simply retire and step back from their life's work. Working, achieving and measuring themselves against yesterday's version of themselves is how they live; it is the core of their being. These are the creeds under which people as diverse as Warren Buffet, Roger Penske, Rupert Murdoch, Sumner Redstone, and Sheldon Adelson, to name only a few, live under.
To attempt to alter these types of leaders' thinking over the practical matter of succession and mortality will likely not succeed. They simply refuse to enter into the discussion.
If you find yourself in a position to discuss succession planning with a reluctant owner, what can you do? Start by considering changing the course of the conversation. Instead of focusing on succession, talk about the continuation of the business.
In my experience, I have found that by changing the focus to the continuing success of a company and the people the owner cares about (rather than on setting an "end date" for working) reluctant owners are more likely to engage in conversation about the future.
These are five ways to start the conversation:
- It's not about succession, it is about continuation. I won't pursue succession and won't ask you to. I will ask you to work on the long-term continuation of what you have built and how we can ensure it continues upward under you and after you.
- It's not about retiring or stepping back from the central role you play. It is about choosing, coaching and preparing the people you want to step into top leadership roles in the future to ensure the continued success of the business.
- It's not about letting partners, customers, children, investors, and others push you into "giving them the plan and the date." It is about having a plan to ensure the people you care about - your children, grandchildren, employees, and others - have the strongest possible business to take forward.
- Remember, you are a planner and a strategist, that is what got you here. No one will develop a better process for the future than you. Without a plan, you have left the future of all the people you care about to chance and to outsiders with their own agenda. Do your best for them, or you will leave it to others to do unto them.
- It's almost certain that you feel you are doing your best work right now and it is probable that your best years are still ahead of you. Now, more than any time in history, business leaders are doing their best work when they are in their 70s, 80s and even 90s. While you are doing your best business work, you must also do your best coaching work. You must create a legacy of skills in the generation of employees and family that will lead with you today, so they can lead after you later on. You must teach, coach, delegate and demand accountability - or you leave them unprepared. That is not the legacy you want to leave.
This simple change in the focus of the discussion - from succession to continuation - was successful in the case of the 77-year-old owner. He is now working to take the necessary steps on a plan to ensure the future of his company - one that stops short of setting a date on his end of work.
I am certainly not advocating that business owners delay retirement until they are 94. After all, their successors do not want to wait until they are 63 to have their turn (which is a real life example from among my clients). I'm simply acknowledging that there is a type of business owner who feels he or she can never retire - and nothing you can say will change that.
For these types of owners, the idea of continuation planning, rather than succession planning, is a much more palatable pursuit, and still fulfills the important and necessary goals of a traditional succession plan by preparing future leaders, delegating responsibility, sharing development of strategy, transferring stock and doing the necessary estate and compensation planning.
At the same time, it leaves intact the core work life that some owners need. Without that work, they simply would not feel alive.
The bottom line is that planning for the future, whatever term it is called, is important for the greater good of the business. Taking the necessary steps to prepare for the continuation of that success is a legacy anyone would be proud to leave behind.
If you would like more information on Succession or Continuation, contact Don at 814-528-9403 or DonMoore@DecisionAssociates.net.