Succession Planning

Process rather than event

Succession planning used to be a secretive ritual, performed by an inner "power group" or a domineering CEO, able to handpick a successor to maintain a power base. It is now approached as a process rather than an event and is much broader in scope. There are now several keys elements to success.

6 Key Elements in the
Succession Planning Process

1. It must be driven from the top of the business.
   • The CEO has the power to fuel commitment and make it work.
   • Subordinates aren't objective - they are competing for the power.
2. It must focus on the culture and strategy of the business.
   • family succession planning must be done and agreed upon before a plan can be successfully developed and implemented for the family business. The family plan
     • should include strategies to put the business interests ahead of the family interests
     • should emphasize merit over family position
   • The company mission and strategic plan will have identified where the business is going and what it needs to get there. SP should focus on who is needed to lead the business if it is going to accomplish the mission.
3. SP now recognizes that successors and future leaders must be developed by the family business - that is, they can be made or grown by the business, using a blend of many approaches:
   • experience and training outside of the family business and industry;
   • formal education and training courses;
   • internal job assignments, job rotation, special projects;
   • community and professional organization leadership.
4. SP also recognizes shared responsibility where the existing management [family members and non-family members] share in the responsibility for identifying and pursuing their development activities like those mentioned above. It follows that managers must be evaluated on their ability to develop subordinates, not just on their own job skills.
5. SP should be built in to the employee performance evaluation process and should include assessment by multiple raters. This is known by various names but usually involves a manager being rated not only by his superior but also by colleagues on his same or peer level and by subordinates.
6. SP will only be successful if the family and business is committed to making it a part of everyone's job responsibility. It is much easier to believe in and commit to something you DO rather than to a vague concept.

Family Business Experts Understands
Family Values and Business Systems

Succession planning is a process that evolves a successor, rather than an event that produces one.

Family Business Experts brings vital objectivity to your succession planning

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Family Succession Plan