Successful family business succession requires entrepreneurship not only in the current generation but more importantly in the future generations. Succession is not about passing on the business of today but seeding the capability to create the business for tomorrow. If that capability does not exist succession can result in a barren lake where the existing business dries up, and nothing is left to pass over to future generations.
Active Knowledge Question:
Is your focus on passing over the business you have built or passing over the skills to create new businesses?
Danger 10/12 – Barren Lake
The future of the business is uncertain as entrepreneurship has not been seeded in the next generation. No business will last forever, and each generation must possess the capability to grow and evolve that business and/or create new businesses.
In a changing competitive landscape business leaders must always have an eye to the future and continuously seek to position and equip their business for enduring success. As businesses mature, they can readily reach a point of comfort that can quickly translate into decline.
Succession is all about ensuring that the business prospers well beyond the current leadership team. This requires an ‘eye to the future’ and making sure that the DNA of the business is one where it is continually seeking to evolve, reinvent and step out from its current competitive position.
The capabilities are important, but the culture or DNA is even more critical. The ability of a business to be successful in the future is dependent upon its ability to craft that future, to see the possibilities that no one else has and to step forward and lead the market and customers to a new level of value.
If the business keeps looking back and relying on the past to provide the future, then its days are surely numbered. A bright future lies not only in the exciting and enticing list of opportunities it has to pursue but also the capability to create and see that future.
Quotes From Travellers – Principal Outcomes:
“The primary outcome is that my son succeeds me in perfect harmony with other stakeholders of the company”– From A Family Business in France.
“Smooth transition of power, financial independence for myself and my wife, confidence in children to successfully carry on management of business” – From A Family Business in Canada.
“Stability within the business, continuing the path and growing even more” – From A Family Business in Jordan.
The Twelve Dangers
There are many dangers that the traveller must be wary of and keep a close eye out for. Not only must they avoid these dangers but be proactive in protecting against them.
Part 10 of the series: 12 Dangers To Be Avoided In Succession
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All the best in the success of your business,
Richard Shrapnel
