Home > Business Succession > Starting Succession in Anticipation

Starting Succession in Anticipation

By: J.A.J Aaronson - Updated: 30 Sep 2010 | comments*Discuss
 
Family Succession Business Successor

The choice to leave your business to a family member is an important one and one which should not be taken on a whim. Rather, it is a process which must be meticulously planned and prepared for well in advance.

Potential Benefits

Family succession can offer a huge number of potential benefits for a business. It can mean that the original vision of the founder can be continued through the instatement of a relative; it can also mean that the founder can maintain a close interest and, indirectly, an influence on the workings of the organisation. Although such an influence may well have been secured through a consultancy position or similar, the act of placing a relative in charge of the business all but guarantees that the founder will also maintain non-official influence.

However, family succession can also present considerable difficulties for all those involved. These difficulties can be severe enough to cause the collapse of a business or a family, as has been seen in numerous cases. The chance of such crises occurring, however, can be mitigated by a good plan of action which is put into practice well in advance. Family succession must begin in anticipation of the event itself; it is by no means enough to instate a family successor without laying the ground first, both for the incoming family member and for the business as a whole.

Many of those who choose family succession have an idea set in their mind as to who the successor will be well before that individual has even finished their education. This can be dangerous, particularly when the individual in question does not wish to take on the post. If you are intending on passing on your business to someone who is currently still in education, it is vitally important that they do not consider themselves to be without any other option; such a feeling is highly likely to cause an existing relationship to become fractious.

Qualification

Many business founders also place the family connection above considerations of qualification. If you are more concerned with finding a family successor than you are with necessarily finding the best-qualified individual to do the job, you must ensure that you prepare your successor as best you can. This can mean encouraging a sound formal business education, but there should also be an emphasis on practical experience. This could mean extended work experience, either in the company in question or in another organisation, in order to obtain a view of the workings of a similar business model. It is also vitally important that the successor has experience of a variety of tiers of business; it is not enough to push them straight into a management position without having ensured that they know about the day-to-day workings of their staff.

Any damage to employee relations can also be mitigated by ensuring that your successor has practical experience of the day-to-day running of the organisation. There may well be existing employees who consider themselves to be better-qualified for the job than your chosen successor; their concerns can, to some extent, be assuaged by ensuring that the individual who will actually be taking on your job has had good exposure to the organisation prior to their accepting the position.

You might also like...
Share Your Story, Join the Discussion or Seek Advice..
Why not be the first to leave a comment for discussion, ask for advice or share your story...

If you'd like to ask a question one of our experts (workload permitting) or a helpful reader hopefully can help you... We also love comments and interesting stories

Title:
(never shown)
Firstname:
(never shown)
Surname:
(never shown)
Email:
(never shown)
Nickname:
(shown)
Comment:
Validate:
Enter word:
Topics
Latest Comments
  • Lisa
    Re: How Legally Binding is a Will?
    My gran had will and she had sign by 2 witnesses and my grandad was there my gran and grandad now sadly passed and a can't find…
    18 September 2020
  • Ionnikins
    Re: Keeping Your Will Up-to-Date
    My wife and I have mirror wills. We have agreed that on first death the survivor will vary the will in order to pass on to our…
    29 August 2020
  • MARYM
    Re: Preparing Your Will in Scotland
    My father changed his will 4 months before he passed away aged 82, he was unable to sign his will, he only mentioned 2…
    12 May 2020
  • scot20
    Re: Scottish Rights of Succession
    In a simple will, no property on a little savings, is it necessary to have a whole section on trusts as in STEP? Everything going…
    20 April 2020
  • suspicious
    Re: Preparing Your Will in Scotland
    Scotland - The main beneficiary of a will made by my uncle ( suffering from dementia) arranged for a completely new Will to be…
    8 April 2020
  • Someone
    Re: Dealing With Intestacy
    Hi, I am trying to get prepared for when my time comes when my mother passes on. There is a will and I am the sole person who will…
    2 December 2019
  • Tina
    Re: Preparing Your Will in Scotland
    My husband signed will at the later date than will itself is dated. On the last page is only his signature,no printed name and…
    23 November 2019
  • Robin
    Re: Are Verbal Changes to a Will Valid?
    My Mom passed away she had a will made in 2012 though since has wanted to make changes she told me and my sistee (whom is…
    27 July 2019
  • Ray Delta
    Re: Debt After Death
    My partner passed away in February 2019 leaving no estate assets or monies, she had a vehicle on a lease hire agreement with an £8,800. now owing.…
    7 July 2019
  • Geoff
    Re: Divorce and Revoking a Will
    Three years ago when my wife, now deceased, was in a nursing home I had a will written that left everything to my wife's great…
    4 July 2019