One of the most daunting challenges in the family business is to successfully identify and name the best candidate to succeed as the business leader. Families who mishandle this important step in the family business evolution risk doing long-term damage to the business and the family.
We recently completed a multi-year process with a family to objectively identify and name a successor. There was trepidation and concern from the founder at the beginning of the process, however there was a great sense of celebration from everyone when the new president was named at the recent family meeting.
Having an objective outsider, well-versed in both leadership expertise and family dynamics can take a lot of the pressure off the founders or parents of the competing siblings. The following steps give the process a well thought out recipe for success:
- identifying the key leadership competencies needed for business success
- assessing all current candidates against the leadership competencies
- creating a realistic development plan for all candidates
- having periodic milestones to measure progress against plan
- communicating a broad timeline and allowing room for flexibility
- communicating a stated process for fairness for all participants
- providing support and career paths for all participants
Even with a well thought-out plan every family should anticipate a few bumps in the road. In this particular family, there were concerns about fairness, trust and working through past histories of family dynamics.
In the end the family was able to clearly identify the needed competencies for the future president and over time it became clearly evident which candidate was best suited for the role. In the process other candidates began to see a clear vision for the future that enabled everyone in the family to win.
It’s with great pride that everyone has a sense that the family business now has a clear leader and supporting team players in their “best fit” roles to ensure the family businesses’ next chapter of success. Everyone in the family was acknowledged for their patience, trust and authentic participation in the process.
Don’t wait too long to start your process for selecting and naming the future leader of your family business. Too many families kick the can down the road and hope somehow the right solution will present itself. Too often a family’s procrastination and fear of the unknown causes the family and the business to get stuck in neutral with an uncertain future.
If you want to learn more about the process watch this short and entertaining video!