Barriers to Succession Planning and How to Overcome Them
It’s extremely important to resolve common issues before embarking on succession planning. Addressing these challenges proactively and positively will increase a family-owned agribusiness’s chances of continued success and prosperity, says Trevor Dickinson.
To be profitable in the long term, family agribusinesses must overcome the obstacles inherent in succession planning. These obstacles often prevent family members from moving from their current state to navigating the succession planning process smoothly and successfully.
Challenge 1: Lack of appreciation, recognition and love
The problem: The senior generation desperately wants the appreciation of their adult children, but they will deny this fact until their dying day! The adult children of the younger generation have the same problem: they always seek recognition from their parents for their achievements and their uniqueness.
The lack of a feeling of being recognized and appreciated is at the root of many problems in family-run agribusinesses. There is an implicit presumption that people are liked, but the fact that it is rarely expressed often creates a barrier.
The solution: Teach family members how to talk about their expectations of each other in an emotional sense and how to express their appreciation, gratitude and love. Many families struggle with this and take it for granted. Most families need to learn that the emotional outcome of a family agribusiness is just as important, if not more so, than the financial outcome. Appreciation, recognition and love should be expressed regularly.
Challenge 2: Unforgiveness
The problem: When there has been a breakdown in family relationships, the lack of forgiveness hinders success. It’s nearly impossible to go through life and get involved in a family business without inadvertently stepping on your toes from time to time. Those families who lack the ability to forgive each other for their transgressions will clearly find it difficult to do business together.
The solution: Drawing on the family’s religious background can help bridge this gap successfully, since most religions have a philosophy of forgiveness. If the family is not religious, recognizing the need to set aside grudges for the good of the business is an important first step.
Challenge 3: Control
The problem: The question of control, which makes the success of owner-entrepreneurs, is also their Achilles’ heel. The reality is that it is not just the entrepreneurs, but the family as a whole, who have to deal with the issue of control. In short, it is about change, and change is difficult even when it is positive. This can be a major problem for an entrepreneur who has spent most of his life working closely with the family business.
The succession planning process can be seen as treacherous by the senior generation in that it can lead them to believe that people are trying to change them and take their farm away from them.
Change is one of the most difficult aspects of life for all of us. In the context of family agribusinesses, it is not uncommon for people to expect others to change so that something good can happen. This expectation is a formula for disaster.
The solution: Take responsibility for what you can successfully contribute to the family business and also take full responsibility for your contribution to the problem. If necessary, help other family members to take full responsibility.
Challenge 4: History
The problem: Although family history usually comes with challenges, the older generation can go out of their way to talk about only the good things. But the family businesses that struggle to create their future are often the ones that have not faced the difficulties of the past. In short, positive accomplishments should be celebrated and past problems acknowledged.
The solution: During the succession planning process, seek to understand any significant challenges your predecessors may have faced. By understanding your family history, you may be able to overcome the challenges of estate planning.
Challenge 5: Emotional scarcity
The problem: Emotional scarcity is one of the most difficult issues in family agrifood succession. What makes it so insidious is the fact that it is invisible due to the family’s underlying assumption that “there is not enough for everyone”. This question often arises in the discussion of money, roles and power.
In a family-owned agribusiness, there are two bottom lines. The first is the standard financier. The second is the invisible, emotional bottom line. It’s the lack of expression of appreciation, recognition, and love, and that’s the underlying problem of emotional scarcity.
The solution: There are two strategies that help solve the scarcity problem. The first is to have family members talk directly about what they want from each other. The second is to empower family members to realize their full potential, whether inside or outside the family business. In doing so, families begin to understand the sense of abundance that exists in the world for all of us.
Challenge 6: Right
The problem: This is often seen as a problem of the younger generation and involves family members using their name as a way to gain advantages over other people in the organization. Elderly family members may also feel empowered to continue with key leadership responsibilities. This usually has a negative effect on morale.
The solution: Work together to talk about the best interests of the business and all stakeholders and how you can all continue to help the family and the business succeed. Having a common family vision mitigates the issue of rights and greatly facilitates the creation of win-win succession strategies and solutions.
Challenge 7: Indirect communication
The problem: Family members involved in the business often talk indirectly with other family members about issues they may be having with other family members, but do not talk to the people involved.
The solution: Understand the pitfalls of indirect communication and make a point of using direct communication.
Challenge 8: Differences are seen as a liability rather than an asset
The problem: Family members often see small business differences as issues they don’t want to discuss with other family members. Since they want to maintain harmony, they often inadvertently create the very problem they are trying to avoid by not discussing their business differences.
The solution: Teach family members to discover their differences and use the synergy created by those differences to do things in ways they might not otherwise have considered.
Challenge 9: Poor expression of feelings and desires
The problem: In many family businesses, members do not have the ability, experience, or confidence to express their feelings and desires, and although they may have expectations of each other about what they want emotionally, they are reluctant to express these expectations.
The solution: Family members can benefit if they engage in a communication training process that allows them to become more comfortable and confident in their ability to express their feelings and desires. They can quickly acquire the skills necessary to overcome this obstacle.
Trevor Dickinson is CEO of Family Legacies, a family business consulting firm. Visit family-legacy.com.