10 Ways to Catapult Your Family Communication Through Succession
Picture this: Owners of family businesses are aging, a recent survey suggests that 51% of business owners intend to transition the ownership of their business by 2025. Whether you are contemplating selling the business to a third party or passing it to the next generation, you need to plan ahead.
Succession is an art in itself. It is an art, particularly, when it comes to managing the needs and expectations around the transition. In a multigenerational family business, having the heirs ready to step into business-critical roles at the right time represents a major challenge, and for the next generation to take up a leadership role also holds many difficulties to handle, as well as a full spectrum of exciting opportunities and responsibilities. Especially, since the next generation of leaders are digitally savvy, will lead with adaptive, critical and innovative thinking, and will require digital solutions for many of their activities.
As a family business owner/leader, here are some questions for you to consider:
- Are you facing a transition in the next few years?
- Do you know how to get your next generation more engaged and involved in the business?
- Do you know if your next gen has the right skill sets to run the business?
- How do you identify your future leaders? How will you support them?
- How do you cultivate a culture of transparency and communication efficiency around sensitive subjects?
- Who is/will be in charge of your communications strategy?
If you nodded yes to the majority of the above questions, then the following ideas will pique your interest in building a powerhouse transition plan and keep your family engaged and aligned.
- Start as early as possible; succession planning needs to be embedded in the education of the future leaders, and usually, never finishes at all. Each family is different hence there is no one right or wrong process, and in most cases, the previous leader does not just walk out the door with all the critical knowledge, wisdom and expertise.
- Establish a detailed, well-thought-out action plan for the transition that fits all expectations, and needs. Scaling up communications around all these facets is even more important to keep everyone informed.
- Define the goals and challenges around the future leadership, values and wealth transition at an early stage. Plan and communicate meticulously towards achieving those objectives. This exercise can reduce uncertainty drastically, thereby strengthening the family staff and shareholder confidence.
- Make decisions on what to communicate and to whom within your closest circles to keep everyone informed and aligned during the planning and execution period of the transition.
- Enable continuous idea circulation, monitor processes from all sides, and present opportunities and responsibilities subtly and efficiently. Relying on family members, but also on key staff, is fundamental as they are well-versed in the breadth and depth of the family business, its core values, and its vision.
- Work together and find the necessary content, information and expertise everyone needs for their respective roles in a digitally secure environment. It is about connecting: instantly sharing content, information and ideas, in one centralized platform, if possible. If you use e-mails, instant messaging, online meetings and other communication methods, how do you ensure that you collect all the information and keep track of everything in a timely and efficient manner? Although multigenerational family businesses have various collaboration tools in place, many times, they lack a formal collaboration strategy.
- Communicate the strategy with guidelines for everyone to follow. It is essential for the family and for the business culture too, it sets precedence, and it shows commitment. Data and critical information can easily get lost through fragmented inefficient systems operating in silos.
- Appoint a person responsible for all communications. Define what you share, and with whom as a structured consistent process to enhance trust and alignment. Families require transparency for their family members and their shareholders. However, they are extremely specific about the relevancy of information shared, based on member involvement level in the family and business roles and responsibilities. Decide the type of information and data that can and should be shared publicly as well as internally and identify the areas that need to remain completely confidential. E.g., providing family members with permission-based access to sensitive information is effective.
- Inform, inspire and engage. Empower your senior family members to easily mentor the next generation through articles and informational wisdom; and the next generation to confidently share photos and videos about their interests, successes in sports and academic achievements. Involve your board in shaping and regularly viewing your succession strategy, maximize opportunities and long-term business success based on timely feedback and recommendations. Based on the types of endeavors and engagements, continually revise your talent pool, identify and enhance any skill sets.
- Embrace digital communication to avoid disengagement and internal conflicts, whether it is for transition planning or for other salient activities. Creating a sound transition plan is simply not enough, your success will critically depend on the maturity of your family alignment and the communication of your transition strategy.