A generational transition is a critical point in the life cycle of a family business. All too often the senior-generation leaders believe they have a foolproof succession plan in place, but problems arise when the time comes to pass the torch.
Here are just a few of the ways a succession plan can go wrong, along with some troubleshooting advice.
1. The viewpoints of all parties are not considered.
Consultant Michael Palumbos of Rochester, N.Y., recommends that the senior-generation leader do a lot of listening as well as talking. “Find out what’s going on with your kids,” he advises. “Ask if they are really interested in taking over the business and what role they would like to play. Ask yourself if you are sincerely ready to retire. Find out from your spouse if he or she wants to continue to be part of the business or not. Ask what is important about the business. Is it important because of what Grandpa always did or because of today’s situation?”
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