Family Business Succession Planning - Critical Factors Impacting Goals

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Business Succession Planning can appear to be an overwhelming challenge especially when emotions impact business dynamics. However, you can manage the complexities of business succession by understanding and addressing all the pieces of the puzzle.

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Family Business Succession Planning - Critical Factors Impacting Goals

  1. 1. The Rawls Group ~ Business Succession Planning Tools Family Business Succession Planning Best Practices Critical Factors Impacting Business Succession Goals Business Succession Planning can appear to be an overwhelming challenge especially when emotions impact business dynamics. However, you can manage the complexities of business succession by understanding and addressing all the pieces of the puzzle. Consider: OWNER’S ROLE Motivation & Perspective Personal Financial Planning Business Structuring Business Performance MANAGEMENT Strategic Planning Leadership & Management Continuity Synergy & Teamwork Successor Preparation FAMILY DYNAMICS Understanding and Unity Governance Reasonable Expectations Succession Success™ Requires More than Basic Estate Planning
  2. 2. Page 1 of 2 The Rawls Group – Family Business Succession Planning Tools Understanding the Key Pieces to the Succession Matrix® Puzzle OWNER’S ROLE Most business owners believe that they “Have it All Done” through developing wills, trusts, and buy-sell agreements. Succession planning involves more than basic estate planning. Clarifying your goals, responsibilities, priorities and opportunities is critical to business succession because your family, management team, and employees look to you for leadership. The business ultimately takes on your values, goals and objectives. • Have you developed sufficient wealth independent of the business to support your exit strategy? • Have you addressed the keep vs. sell contingency? • Do you have a clear vision for the future? • Is there mutual respect between family and management? • Does the next generation have good relationships with your lending institutions for future capital and debt guarantees? • Is your business appropriately structured for tax efficiency and to facilitate stock transfers? • Have you leveraged available gifting opportunities? • Is business performance optimized to ensure your business can handle the predictable dip in productivity during business ownership and management transition? MANAGEMENT Succession Success™ is not just about getting your “ducks in a row”; it is highly dependent upon the strength and depth of your management team. • Who are your key managers? Are they working together to achieve organizational objectives or operating in silos to meet their personal goals? • Can business operations continue without you? • How well does business perform in your absence? • Have you implemented key manager motivation and retention plans? • Have you identified successors for each of your key leadership positions? FAMILY Preserving family harmony does not happen by accident. It requires a deliberate effort to confront difficult issue while respecting individual and generational differences. • Do you have a process for properly hiring and training family members interested in your business and integrating them into your management team? • Have you documented and communicated your expectations to family members interested in joining the business? • Does your family share a common vision? • Are the strategic goals of the family aligned with your business goals? • Is there a forum for reconciling family business issues?

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