Yesterday, I made a presentation on business succession planning at the Niagara EXPO and the conversation with the group was facinating!
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.
Showing posts with label staff development. non family businesses. transition planning. Show all posts
Showing posts with label staff development. non family businesses. transition planning. Show all posts
Saturday, October 3, 2009
Monday, September 28, 2009
YOU HAVE TO LET GO TO WIN
A few days ago the Gallup Organization published the results of an eight month survey that showed that business owners have the highest overall well-being of any occupation group – followed closely by Professionals and Managers/Executives.
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.’
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.’
Tuesday, June 9, 2009
MORE THAN JUST FAMILY BUSINESSES
I find it interesting how many times, when Succession Planning comes up in a conversation, that subject immediately focuses on family businesses. I was interviewed by a local business journal and never mentioned family business in our conversation but, sure enough, that's all was talked about in the article! Even my comments were edited to relate to family businesses.
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.
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.
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