Problems arise because all matters pertaining to the business get mixed up in the overlapping areas. Individuals play multiple roles but mix them inappropriately or lack awareness of how to separate the issues. It is in these overlap areas that confusion reigns.
It is crucial to clearly identify where issues stem from and then move them into the circle in which they belong. By separating the issues in this way they can then be addressed individually, and before they become huge roadblocks.
Succession planning impacts all 3 areas of a family business and is therefore the focal point of the overlap area.
- Three Circle Model
A detailed Succession Plan affects all three areas (circles) of a family business and is therefore the focal point of the overlap area. While it serves to protect the ownership and wealth of the business, it also involves the financial plan of the individual owner(s). Additionally, the strategies for management of a family business are reliant on an appropriate succession plan.
Once such a plan is in place, it becomes a great foundation for determining what else needs to be done, and what training or education will be required, to move the family business along.
What Makes a Good Succession plan?
As entrepreneurs, our vision of “succession planning” is generally focused on wills, tax strategies, estate structures and financial planning tools. However, it is important to first identify your personal goals and then ensure that your succession plan, and the family business itself, is structured around them.
The Line of Confidence ™ chart depicts how we guide families from the Inertia Stage, where they are unclear or unsure about what the future might hold, across the Line of Confidence, to the Implementation Stage where they are informed and excited about what they can build together as a family.
We call the left side of the chart, the Education Phase. Here we employ a variety of tools that inform and educate families so that they can develop the confidence to address the inevitable change in leadership of their family business.
So whether it’s a little uncertainty, a deeper fear, or just plain old procrastination that stops you, we can help you move forward with confidence.