Developing a Succession Process
Succession in family businesses is time of both crisis and
opportunity. Succession is certainly a crisis in family businesses;
only one third make it to the second generation. Successful
families in business take advantage of this transition time
as an opportunity to develop an objective process that creates
an atmosphere of collaboration, lowers the emotionality in
the system, and establishes benchmarks for the company, the
board, as well as the management. As one of my clients said,
as we drafted the succession plan, "I get it; it's first
about the process and then the people." And, if the process
is fair and transparent, the right people will be selected
and the chances for buy-in by all are increased.
The following is an example of a succession process (As you
review it, consider how your company is planning or has accomplished
1. The board initiates the succession planning process.
2. The board will activate the Search Committee whose membership
will represent the board, the family, the advisors, owners,
and business management:
3. The Search Committee then implements the executive selection
process, including the following:
a. Agreeing on key competencies and selection criteria
for next leader
ii. Skills and abilities
b. Selecting potential candidates
c. Candidates should not sit on the Search Committee
d. Interviewing candidates
e. Reviewing of data, including Leadership Assessments,
candidate's vision for business, and work history.
f. Organizing data and make recommendation to the Board
or the nominating committee of the board.
4. The Board makes the final decision and plans for the support
of the new CEO and resources for a smooth transition process.