Family Business Matters       06/02 12:13

   Succession's Secret Sauce

   Strong friendships provide crucial emotional support, accountability and 
shared wisdom that can help senior generations navigate difficult leadership 
transitions.

Lance Woodbury
DTN Farm Business Adviser

   Management succession in a family business is easy to define but hard to do. 
Put simply, it is the act of transferring authority and responsibility to the 
next generation. In practice, it is anything but simple.

   WHY SUCCESSION IS HARD

   Succession involves relinquishing control of your business, which you've 
managed for decades. It needs communication, which is notoriously difficult in 
family businesses. It challenges your identity as a farmer or rancher, a 
vocation not so easily shed. It requires getting comfortable with the next 
generation's approach to business and life, which can be quite different than 
how you were raised or taught.

   Succession also causes you to confront your mortality and your purpose in 
life. It forces you to consider the next chapter of your life story, when you 
may consider your current chapter unfinished. It's no wonder that people 
hesitate to engage in succession planning and transition discussions.

   THE PSYCHOLOGY OF SUCCESSION

   It's tempting to solve succession planning with checklists, timelines, 
organizational charts, job titles and legal documents. Such tools are indeed 
part of the solution and a necessary part of the transition effort.

   The problem is that succession is as much a psychological and behavioral 
transition as it is a management, ownership, legal, financial or tax 
transition. Succession requires you to think and act differently, not just 
create plans. It means changing how you see your work on the farm or ranch, 
moving from doing the work or leading the team to watching or helping someone 
else do the work. And, if you stay around, it means submitting to someone 
else's leadership.

   It is difficult moving out of the top spot but still being around the farm 
and watching someone else take over the daily work. In nonfamily business 
settings, the CEO seldom stays around after a leadership transition. He or she 
knows the next leader will lead differently, and that change will be hard to 
watch.

   Succession is built on your accomplishments, as the very act of 
transitioning means the business has survived the economic cycles of 
agriculture through at least one generation and usually several. But, as the 
next generation begins to take over, it also brings your shortcomings into 
focus. The next leader changes the business, and those changes can feel like a 
critique of the way you operated.

   FRIENDSHIP TO THE RESCUE

   The longest-running study on human development, the Harvard Study of Adult 
Development, has found that "close relationships, more than money or fame, are 
what keep people happy throughout their lives." Furthermore, psychologists 
suggest that friendships help delay mental and physical decline, reducing the 
risk of loneliness, depression and anxiety while bolstering self-esteem.

   I've seen firsthand through my work with family businesses and peer groups 
that friendships -- particularly among senior generation members who are going 
through the succession process -- can help smooth the transition. Friends can 
encourage you. They can challenge and critique you. If you let them, they can 
hold you accountable for making progress. A small group of friends serves as 
your personal board of directors.

   Friends are the people with whom you can share your hopes and concerns about 
succession. Perhaps one of your friends has been through a similar transition 
and has wisdom to offer. More likely, the mistakes they made can be instructive 
for your own transition experience. Friendships are where you find commonality, 
security and support.

   C.S. Lewis said, "Friendship is born at the moment when one person says to 
another 'You too? I thought I was the only one.'" Try looking to your friends 
for help with succession -- you may be surprised at how they help.

   Lance Woodbury can be reached at lance.woodbury@pinionglobal.com

    




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