Thursday, November 5, 2009
Choosing and developing them is one of your challenges. It's an obligation you have to your partners, shareholders and other staff members.
If you fail, all the rest of your work in building a sustainable organization will have been wasted. You will have failed in leaving your legacy.
Many leaders and owners pick their potential successors based on erroneous assumptions about 'What it takes' to be a leader. They incorrectly assume that loyalty, longevity, good technical competence, being a family member, etc. are the best criteria to use.
That's what it takes to be a good 'Number two' - a good 'doer.' That MAY qualify then to be good managers - this is not what it takes to be a leader. There are relativly few people who can lead.
What's the difference between a good manager and a good leader? A recent article in the Wall Street Journal is a good reference.
You may have lots of good managers in your company. And you'll be lucky - or brilliant - if you have surrounded youself with several people who have leadership potential - the qualifications to lead the company after you step aside.
THE BOTTOM LINE; take a long, hard look at the people around you.
Identify those who have leadership potential and focus on grooming them. If you don't have what you need, start searching - outside your company NOW. And stop wasting your time trying to make your good managers into mediocre leaders!
Saturday, October 24, 2009
Do you owe them a job in the business? Do you owe them guaranteed income?
When our kids were growing up Janie, my wife and their Mom, had a phrase that became our guide: "Every pot has to set on its own bottom." In other words, our goal was teach them to be self-suffcient - to discover what their life passion was and to support them in their quest to achieve it.
In other words, the goal was to help them identify what really mattered to them and not expect them to live out some dream we may have had for them. Although I was an engineer, there was no need for them to become engineers - unless that was what they wanted to be. They didn't have to move back to Lockport, where we live - unless they wanted to. They didn't have to come back to the business - unless they wanted to. (None became engineers, none moved back home and none joined the business. That was OK for us.)
We are pleased for their personal successes - each in their own way.
Every parent needs to ask themselves what they owe their kids. This seems to be a key question for business owners when they think about their children and their business. Somehow there seems to be an unspoked assumption that the best thing for at least one of the kids is to come into the business. The business owner may see that as the step to leaving their legacy. The child may see this as a easy step to take without any deep thought about what really matters to them, what they want to accomplish with their lives. It may or may not be the best move - for the owner, for the child (who is now an adult) or the business.
Which brings me to the question "What do you owe your children?"
First, let me offer some ideas about what you don't owe them. You don't owe them a job. You don't own them a steady income. Your don't need to decide their life purpose.
You do owe them love and support while they are educating themselves - only partial if that's all you can afford. You owe them nuturing while they are growing up. You owe them a lasting set of values that will enable them to live a successful, caring life that enhances our culture.
Then you owe them the opportunity to develop self discipline and self suffciency. You owe them respect for who they are - even though it may not be what you had hoped of them.
Last, but not least, you owe them the freedom to follow their own path and to grow into supportive, caring individuals who offer the same to those around them.
After they have sorted this all out and developed clarity about their self identity, if they decide they want to join your business, the odds are that you'll have a great staff member with potential to be a future leader!
Wednesday, October 21, 2009
- Will I have the money I need to support the life I want to live after I retire? That involves money I have saved and invested, my retirement funds and the proceeds from the sale of my interest in the business.
- Have I built a strong sustainable company that will continue after I move on? Have I developed the people with the passion and the competence to lead the business and hold to the values I instilled?
- Have I chosen a meaningful life after work that I will move into? I know that successful retirement is not an ending, It's a transition into a different 'venue' - one that will give me satisfaction because I am doing something I love to do. To be successful I need to prepare for the 'Third Phase' of my life.
People who have answered these questions in a way that matches their aspirations can move on knowing that they can make a successful transition and leave a successful business as their legacy.Those who haven't are in danger of holding on too long and destroying the very business they spent their life to create.
What about you? Are your prepared for retirement? If you are in your late fifties or early sixties think long and hard about these questions as if your life depended on it. Because it does!
Wednesday, October 7, 2009
I couldn't get on the computer - and, of course, I couldn't get on the internet. Besides that, I couldn't use the phone - and no calls came in! In other words, all of my major distractions - the activities that keep me from staying focused - were 'off the table!'
I've often suspected that I have a minor case of ADD (now called ADHD) because it's really difficult for me to work on one task for an extended period of time. I like to 'keep lots of balls in the air' and move back and forth from task to task, doing a bit on one and a bit on another, etc, throughout the day.
Having the computer and the internet and the phone available lets me flit from one activiity to another having a grand time but being frustrated that I don't get more done.
Today was different. The screen was blank, the phone was dead and I was left to working on projects in my notebook. It was a cloudy, gray day, even too dark to read. I still flitted a bit but my 'range of activity' was limited. I could only focus on what I could do in my notebook. I got a lot done!
By the time the power came back on I had made 'real progress' in several tasks that had been 'hanging over my head.' It was a very productive afternoon!
Now the question is 'What did I learn?' 'How will I do things differently, better tomorrow and the rest of the week?'
Only time will tell!
Saturday, October 3, 2009
The conversation focused on the three elements of successful succession: Financial, Organizational and Personal transition. My beginning mindset was on business leaders and business owners contemplating retirement.
But the majority of people in the room were not business leaders or business owners! They were middle managers and even a couple of folks just out of college who were a long ways from retirement. So I 'fine tuned' the presentation to fit their interests and backgounds.
I had a similar experience a few weeks ago when I presented to a group of financial planners. I started talking about business owners and discovered that many in the room had shifted their 'take' on the presentation to their personal situations!
The neat thing about both experiences was that the three part focus: financial, organization and personal resonated with both groups! I discovered that no matter where a person is in their life, when they step back to gain a perspective, they have concerns/interests in all three areas.
They discover that they need to think about where they are and where they want to go - and then make 'life adjustments' to get themselves on track to live a live that will be rewarding and fulfilling to them. They must live their lives by their standards and values, not someone else's.
So I'll keep my three part focus but expand my perspective to a wider range of people including business leaders and owners and others, too.
Monday, September 28, 2009
Another article, published immediately after the Gallup publication, said the findings ‘reflect the importance of being able to choose the work you do and how you do it. The way you manage your time, and the way you respond to adversity.”
In other words, business owners and, to a slightly lesser extent, professionals and managers/executives, derive greater ‘psychic income’- emotional satisfaction – from their work than most other groups.
It's no wonder they don’t give much thought to retirement – what they will do in the ‘third phase’ of their lives. I hear comments like: “I’m happy doing what I’m doing,” “I just going to keep on doing it,” “I’m not ready,” “The company isn’t ready,” etc.
Thinking about making their transition requires them to take time from what they enjoy (love!) doing – so the put it off ‘til later, ‘when I’ve got time.’
The downside is that they are in danger of suffocating their business – the very thing that the have spent their life building!
They run out of personal energy and ideas, the company loses its competitive edge and the best of the next generation, the potential future leadership, seeing no opportunity for growth, move on while the mediocre hang and ‘settle in.’ Slowly, the business ‘dies in the vine’ and the leader’s lifetime investment is squandered.
Every business leader – to assure a successful transition needs to ask – and answer – questions in three key areas:
FINANCIAL - How will I transfer my wealth out of the business into my personal portfolio?
ORGANIZATIONAL - How will I create my legacy – a strong, sustainable company that will thrive after I retire?
PERSONAL - How will I build a meaningful ‘third phase’ of my life – something I am looking forward to after I retire?
Doing all this takes time – time to transfer your wealth, time to build your organization and develop the people to lead it, and time to create your new life. Waiting too long can limit, even destroy your ability to make a successful transition.
No matter how much you love what you are doing now, it’s essential to start planning early. When is the right time? It all depends on your specific circumstances. The key is to start early rather than late. Start too late and you can lose every thing you built – and end up ‘lost in the wilderness.’
Wednesday, July 15, 2009
Everything came apart without a problem. I nearly had it back together when I was stopped dead. I couldn't put the cap back on! I tried a whole bunch of times but couldn't finish the job.
Finally, I gave up and walked away in frustration and disgust - and a bit of anger. What should have been a half hour 'piece of cake' was an incomplete project. What made it even worse was that the sink was the one that Janie, my wife, uses. A bad situation! I didn't want to leave 'broken' for long.
So the next evening, I tried again. In two seconds, I realized my problem and after trying something different - putting two parts together in the opposite sequence - the thing went together like clockwork! I was done in five minutes.
It reminded me of trying to solve algebra problems in high school. I'd come to a point, get stuck and, no matter how times I tried, I couldn't solve the problem. Later, I'd come back to it will an open mind, not trying to solve it the 'old' way and solved it in a flash.
I don't do algebra anymore but the lesson is still there. Sometimes when we get struck trying to solve problems the same old way over and over, we make no progress and get frustrated. The key is step back, forget the old approach and try something new. Often that's all it takes to be successful - think about the problem with a 'fresh' approach.
That same lesson applies to other parts of our life, too. Remember the old saying "If you keep doing what you're doing, you'll end up with what you've got."
This is true in planning your life transitions whether a new job, a new career or retirement. When you are moving into a new phase of your life, the odds are that what worked in the old situation won't help in the new. Difficult as it is to do, you have to let go of what you've been doing and do something different.
You have to let go of your old assumptions, old rituals, old methods, sometimes even old relationships to move on.
What kind of change do you want to make in your life or your work? What isn't working that needs to change? Take some time, choose what you want to create, let go of what you're doing now and try something different.
The future will be different than the past. It can be a step forward if you, like me fixing the leaking faucet, try something different.
Wednesday, June 17, 2009
First, my focus isn't just business owners - its business leaders, both owners and non owners.
My expertise (and my passion) is in two areas:
- Helping business leaders build the next generation of company leadership - including both their successor and the leadership team - to assure the future success of the company.
- Helping those leaders plan and implement their personal transition from the business into life after work - what I call their 'third phase.'
Second, ownership transfer, including 'harvesting income upon retirement' is the work of lawyers and financial advisors - people the business owner (hopefully) already has retained.
My role is as a personal coach, team builder and strategic planner - all areas of focus significantly different than the work of lawyers and financial advisors. I might often interact with these professionals but, most of the time, I see myself working directly with leaders and the leaders' team.
So, based on this reasoning, I have changed my mission statement to:
Coaching business leaders contemplating retirement
Who want to leave a lasting legacy and
Build a meaningful life after work.
There, that feels better!
Tuesday, June 9, 2009
True, every family business needs to have the transition from one generation to the next fully thought out well in advance.
The senior generation has to be prepared to let go and move on.
The incoming generation has to be prepared to assume the reins.
The company has to be organized to execute the transition in an effective, seamless manner.
The legal and financial programs need to be in place ready to be implemented at the right time - often over a period of time.
And all this has to happen for non family businesses, too! In many ways the issues that must be addressed are the same - except the family businesses may have to deal with more emotional issues.
All succession planning involves the senior generation members acknowledging their mortality and making plans for moving into what I call the 'third phase' of their life. Staying in a state of denial can rob the company of any potential to survive and proper into the future.
Most owners want their company to continue on. That also means identifying and developing the future leaders well in advance of the time for the transition to actually take place. In some instances, it may mean recruiting new future potential leaders (and owners) if the current people don't have what it will take.
But, when the 'next generation' was never developed, an internal sale isn't an option. Then, sale to an outside party is the better answer. And sometimes the external sale can generate more retirement income for the seller.
In every transition, family or non family, the challenge is to work out a myriad of details well in advance of the 'event.' More on that later.
The bottom line - whether a family business or not, developing and implementing a successful transition takes time, planning - and a will of the current owner to let go of the comfortable present to move into the different future.
Wednesday, June 3, 2009
My family and I brainstormed a list of names: Moving on, What's next, Your next move, Into the future and a lot of really neat ones but none of them were available.
I had also thought of three others.
Transition Success and Transition Strategies were high on my list. They are at the core of what succession planning is all about. Succession includes several different versions of transition: transition of leadership, transition of ownership and personal transition from a life centered on work to a life that has a different, equally meaningful and satisfying purpose.
We'll be exploring various aspects of transition in future blogs - as part of succession planning.
I finally came to the choice of SUCCESSION SUCCESS. That covers it all. And it's a phrase that everyone identifies with. And like the old Prego ad 'transition is in there!'
Next time, we'll begin to explore succession planning and the various aspects of transition. And in the future, we'll go lots of other places!
It's good to be with you. See you soon.