Clearly, the process of succession is not a one time event, whereby the decision of the next leader and/or successor is chosen as a reactive measure. A degree of proactive processes and thinking need to take place for the transition to be a seamless one.
Current family business leaders need to take the leap and decide an effective date by which they will for certain, leave their respective businesses and once this has been decided upon, then to the best of their ability, they would need to train up the successor to the leadership role to their business.
Family business leaders need to allow for sufficient time to train up a shortlist of individuals in order to take up the mantle of the next family business leader. There is no hard or fast rule as to how long this transition may take but what is for sure is that a shortlist of potential individuals need to be vetted at an early stage and groomed to the necessary standard required. Possibly, in some cases, this could take up to ten years, depending on the size and complexity of the business.
Careful thought can also be given to involving an executive search firm, be it to recruit and train up individuals externally and / or internally.
Once recruited, the trainee should then be actively involved in increasing levels of leadership and profitability responsibility and authority. This could include inviting the trainee to regularly make presentations to the board and all members of the firm, encouraging the person to become visible throughout the field of family business consulting, and having weekly private meetings with the current leader to discuss strategic, tactical, governance, staffing and financial matters.
The firm needs to be willing to empower the recruits to take on challenges and value learning. From day one, involvement in a wide variety of operational concerns, and participation in many learning opportunities, including quarterly all-firm meetings and participation in developing the firm’s intellectual property and client resources. The recruits’ development has to be supported all along.
The board’s focus on reflecting the firm’s successes to date and looking at the future with fresh eyes would, needless to say, aspire the candidate/s to do better.
The mentors need to instil in the candidates’ a feeling that a philosophy of transparency in business has great merit. The view that business continuity demands transparency throughout the organization. In other words, a work environment with reciprocal trust.
The announcement of the company’s next leader should not be a surprise to anyone. In fact, it should be self-evident system wide. A possibility in achieving this would be the creation of a leadership continuity committee which would lead the transition planning process. This parallels what should be seen in family firms that manage leadership transitions well. Fair process, transparency, commitment, professionalism, and not being afraid to set a high bar.
A good piece of advice would be not to change things up too much as a new leader. Focus is required now on being purposeful about the kind of leader needed, learning the areas of the job that are new, and working with the board and the team on long-term goals that all can share.
Candidates success will not only be self-evident, it will also be measured so that any areas requiring further support or development will be quickly identified. Colleagues should be counted on to provide feedback as they go along
(All Statistical and factual information presented in this blog has been obtained from an extract of an article from the Family Business Consulting Group based in Chicago)
At the Family Business Office we can offer you assistance in dealing with family business issues through incentives supporting advisory and mediation services. Contact us today on [email protected] or visit our website at https://www.familybusiness.org.mt/ for further information.