It is great to see families in business together. Especially across the generations.

No doubt there are some downside, but the benefits can be huge.  It can bring significant financial benefits that can outlast the founders.  It can bring a sense of togetherness and belonging that other families never experience and enjoy.  And it can bond multiple generations across family structures as diverse as cousins and second cousins.  No other institution has this power.

That is of course, provided the succession to the next generation is carefully planned and managed.  And of course, provided the business is professionally and skilfully run, that children are properly managed into the business and that various risks are mitigated and managed and wealth is grown outside the business and so on!

But the challenge of succession within a family business is different from an entrepreneur who may be happy to sell to the highest bidder!  Here there is only one group of ‘buyers’ and the owner must strive to ensure that the new ‘owners’ are not going to fail.

In our experience, those patriarchs now in their 70’s (or worst still, in their 80’s) that have not addressed the issue of succession probably will now struggle to do it.  More than likely, minor progress will occur for a number of years until nature takes over.  Sickness and death have a way of forcing succession’s hand!  Tragically, we have been called in to address succession sometimes after the owner has gone, invariably suddenly.  It can be so hard then.

Perhaps the greatest lesson we have learnt is that succession is something best to undertake whilst the owner “is in a position of control”.  That means that the business can afford to change, the owner has the energy and time to deal with key issues and that the long-term planning necessary with family members in respect of employment, management and ownership can be addressed.

And perhaps the greatest feeling, the final realisation of succession.  When the owner finally realises, he or she can let go, trust their children, feel confident that their wealth is in good hands, remain a respected mentor, and get on with the next part of their lives.

It isn’t easy, it takes a long time to fully implement and it requires considerable will power, but the earlier it is started, the better the outcome, for all.