By: Lucy Birtwistle
Make a clear decision about when to step back
Although handing over the reins of your business is difficult for anyone, first generation entrepreneurs often find it most difficult. Discuss the prospect with your advisers well in advance and make a plan. When the time is right, bring the incoming generation into your discussions. Taking time to prepare yourself, and your successor(s), will stand you in good stead.
Don’t shy away from difficult conversations
When it comes to discussions about the future, the more open you can be the better, even though they inevitably involve facing the fact of aging or even not being around at all. Encourage the next gen to be open about their ambitions, whether they involve the business or not. Most important is to foster an environment in which people can speak freely about their ambitions while not putting pressure on anyone to be involved.
Prepare the next generation for the role ahead
Stepping into any founder’s shoes is intimidating, often more so if that founder is a parent. The burden of responsibility for members of a second or third generation can be overwhelming. Some families prefer more structured training, while others opt for an informal approach – site visits or discussions around the kitchen table. Whatever you decide, ad hoc and informal is better than no engagement at all.
Prioritise ‘governance’
Family governance is our business. The meetings we facilitate and the agreements and protocols the family arrive at are all about outlining certain obligations and facilitating discussion. Legal arrangements such as the creation of fit-for-purpose structures, shareholder agreements and wills are often enacted as outputs of these conversations. With a governance framework in place, a process for the smooth transition of your business is much more likely to unfold.