I want to share a brief but informative article I recently read by Josh Patrick on Divestopedia, called "8 Issues To Think About In Family Transitions."
In the article, Mr. Patrick raises eight big matters to consider and figure out before transitioning a family business to the next generation of family members. You might think some of these are obvious, but oftentimes, as business-owners AND heads of families, we are sometimes too close to the matters at hand to see them in their proper perspective. As the son of a small business owner, I had direct experience in this matter.
This is a good list, and I have just a couple things to add to what Mr. Patrick listed.
Point #4 urges the owner to make sure the kids can actually grow the business, once they are leading it. However, in my view, the only way the owner can be confident of that is to allow the kids to TAKE RISKS. Many old-school business owners become more fiscally conservative as they get older, and are averse to taking calculated risks to grow the business. Don't shackle the kids with that kind of hesitancy. Most businesses do not grow by simply doing the same thing, year after year.
Point #7 urges the owner to fully let go, once the business has been handed off to the kids. This is rarely an easy thing to do, even when the owner has been pining to step away from the business for a while. My take on this is, when you leave the business, stay gone. Don't try to be the "helpful adviser." This will make it harder for you to move on to the rest of your life, and it will provide the kids a convenient crutch to use, instead of learning from their own mistakes.
Take a minute to read Mr. Patrick's article. If I can be of any help in your family business transition, please don't hesitate to call.
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