After I started up my own company, I began carefully considering the different ways that I wanted things to grow. I really wanted to use our marketing efforts to spread the word about our company, so I worked with a team of professionals to make my business stand out. Although it was intimidating at first, we quickly discovered that our changes were really helping. We found ourselves succeeding where our competitors had failed, and it was exhilarating to watch the business grow. On this website, I wanted to share great information about resolving business problems and taking care of things proactively.
5 Areas Of Family Business Succession Planning A Consultant Can Help With
Do you have a family business? If so, you face the same challenge that most other family-run enterprises face: succession planning. Succession planning is important for any size business, but the unique dynamics and structure of family businesses make this a particularly difficult subject for them.
One person who can help is an outside consultant. How? Here's how they can help address the five main challenges.
1. Developing Leaders
Who will take over the actual running of the business? In some families, this is an obvious choice. But other family organizations may need to sort out who really wants to be involved and who doesn't. And even when the answer is clear, these individuals may need to develop the needed management skills.
2. Assessing Financials
What financial shape is the company in? Do all the stakeholders understand its financial status? How would it look to outsiders looking to buy in? Your business consultant will analyze the financial statements, bookkeeping and accounting procedures, income projections, asset values, and marketing plan to help you not only value the business for estate purposes but also improve it.
3. Managing Conflict
Every business must manage conflict, but added family connections make this harder for you. If one person will take over running the company, how much input will other stakeholders get? If multiple family members are involved, how will they agree to manage conflict? How well does the family resolve conflict now? And how can everyone get on board the same succession plan? An independent consultant can keep things productive.
4. Updating Documents
The way your company is set up will make succession easier or more difficult. A sole proprietorship, for instance, can be difficult to pass on to anyone else. This may be a good time to change the company to an S corporation or LLC. Does the company rely on personal guarantees? What contracts will affect succession? And if the business will be sold, how can it be prepared in advance?
5. Restructuring Roles
A new governing structure will be necessary as the business is handed off to the next generation. An independent business consultant will work with the family to make the business run in a more standardized, professional way. They may suggest creating and defining individual roles, providing needed authority within these roles, or obtaining training in various business methods.
Where to Start
Could your family-run business use assistance in any of these areas of succession planning? If so, start today by meeting with a business consulting service in your area. With their expertise working with other like-minded businesses, your company will see success no matter what happens in the future.