According to Rachelle Damico in Crain’s Detroit Business, the family in the hit HBO series Succession presents a cautionary tale. Where did the Roy family go wrong in planning for the future of their family business and what can you do to guarantee your business succeeds for generations to come?
- Make regular family meetings the norm: This is an opportunity to identify leaders, discuss business strategy, define short & long-term goals, and pinpoint conflicts of interest.
- Involve outsiders in the decision-making process: Business advisors, lawyers, and CPAs can bring objectivity to the succession planning process.
- Implement key agreements: Draw up legal agreements that set terms around areas such as job status, compensation & benefits, and ownership stakes for family members.
- Explore outside leaders: Sometimes an external hire, placing a bridge executive for a limited period, or even selling the business are the best options.
- Keep things fair for non-employee heirs: Make non-employee heirs life insurance beneficiaries or hand down other assets like the building the business occupies.
Don’t be like the Roy family! Taking these actions now rather than later ensures the stability of a family business.