In order to evolve and have a successful legacy, Family businesses need to have a healthy succession process. But we must not mistake “healthy” for “painless.” Sometimes family emotions although expected, are most times woefully underestimated. Succession is a mind game with opposing views from one generation to the next. Hereunder, we are presenting a few considerations towards emotional challenges that come with the process:

1. An outside adviser is essential for cutting through emotions. A family business transition cannot be healthy without an outside adviser walking all parties involved through the process. Succession discussions need to be facilitated and without the guidance of the neutral party, these may not be achieved.

An outside voice is invaluable during the transition because of the emotional dynamics that will naturally come to the surface. The right adviser keeps you focused on the objective when emotions are running high.

2. Differing timelines can be a great source of frustration. The senior generation will likely want to be very deliberate about preparing the next generation. Conversely, the NextGens may be eager for the transition.
3. As successful as the current business strategies have been, the next generation will make changes. New leaders will want to make changes. That is a good thing. This desire to innovate is what businesses need to stay competitive, but the changes can be hard on the outgoing leader.
4. Decisions impact more than the incoming and outgoing president.Decisions around succession greatly affect at least three parties: family of the current leadership, family of the next generation and the business. An outside adviser can help you stay on track until a decision can be reached that satisfies all three parties involved.
5. A sense of obligation is not a good reason to be the successor.Too many people who stepped into leadership because they felt obligated to, which set them up for personal and professional failures. It is not good or right to assume that a family member is the best choice as successor.
6. Other family members need to be part of the succession process.Acknowledge other family members who may be impacted by these conversations so that relationships are not damaged.
7. Emotions cause you to make bad decisions.Uncomfortable conversations come up the further you dig during succession planning. Disagreement and alignment must be created through layers of dialogue. To avoid the immediate discomfort, you move quickly, only to face larger issues later. All the ugly “what-if’s” need to be dealt with so that the business and other families are taken care of if any of them become a reality.
8. A heaviness comes with leadership. The thrill of stepping into leadership and getting to develop new strategies is a great feeling, but the surprising emotion is the heaviness that comes with it. The outgoing generation is counting on the next generation to be successful. It takes a lot of work not to feel the weight of the world when you are taking over leadership.

( All factual and statistical information presented in this blog has been obtained from an extract of an article from Familybusinessmagazine.com) Follow us on our Facebook page and Family Business Office website at www.familybusiness.org.mt

At the Family Business Office we can offer you assistance in dealing with family business succession planning issues through incentives supporting advisory and mediation services. Contact us today on familybusinessact@gov.mt.