Why are we here in the first place? Oh yes, the book.
Since every company has its own idiosyncrasies, Changing Places helps the business owner figure out how to think about succession and transition planning in ways that fit their own specific situation. Moss and I used lively narrative examples from our practice to bring to life both the potential problems faced by business owners and the practical solutions they have adopted. These “war stories” are my favorite parts of the book. They bring it to life and make it real. Every business owner can identify.
Here’s a good one from Chapter 3. Your Transition Advisory Team
Support Through Difficult Transitions
We know of one situation where the father, Jeffrey, started his company as a “family business” at age forty-six. Jeffrey didn’t need the money from the start. He enjoyed the risk and excitement that resulted from making big business decisions and relished the personal attention he attracted as a business leader.
Jeffrey encouraged his eldest son Steven to take business and accounting classes in college, so he could be useful in the business as soon as he graduated. Jeffrey also brought his daughter Catherine and his other son Mark into the business, even though they had limited business skills. Jeffrey never worried about retirement because he never planned to retire (much to his wife Shirley’s chagrin). When he died at age sixty-nine, it was “with his boots on.”
During his lifetime, Jeffrey was the personification of the business, and wielded his business power ruthlessly within the family. His passing was followed by a six-year long, acrimonious period that included a legal battle over valuation of the business, culminating with Steven buying out his siblings.
During the process Steven learned to value the advice and encouragement of an excellent quasi-board of directors he had cultivated. Steven had to work very hard diversifying the business and increasing sales. He found that developing and maintaining strong banking relations was critical. Steven found that his business plans required him to invest more personal money in the business.
His advisors kept him on track during this difficult period. They critically assessed his expansion plans and helped him find ways to reduce both the required capital and the initial risks of the expansion. When he needed to hire a new sales manager, referrals from his advisory board brought him several top-notch candidates. These are only two of many examples where the advisory board helped Steven‘s business grow and prosper.
As a postscript to this story, Steven recently finished the buyout payments to Catherine and Mark and he now says that though he is very busy, he is happy as can be. (Steven’s wife, Linda, on the other hand, is not so thrilled, because he is not around much and won’t take vacations. Like father, like son…)
Now, just curl up in your blankee. I’ll have another story for you in the next post.
Check it out: “Changing Places: Making a Success of Succession Planning for Entrepreneurs and Family Business Owners” (published by AuthorHouse). Feedback please to: firstname.lastname@example.org
Dave Franzetta and Moss Jackson pen new action planning guide, Changing Places,for small business owners facing the conflict of generational leadership change.
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