Family businesses are too often like the proverbial “red-headed step child” in the corporate world. That’s because there are still a lot of misconceptions, or myths, about family businesses that are simply outdated.
This week we’re talking about #5 and #6 in our “Myths of Family Business” blog series.
Myth #5 – Family business succession plans can wait
Wrong. Wrong. Wrong. Deciding who will follow the CEO’s act may be the single most significant act of any reigning family business leader. This crucial decision needs to be planned far in advance, preferable involving a team of people, and should include provisions for identifying, qualifying, recruiting (if necessary), training and retaining the next generation of leaders.
Sadly many family business leaders put succession off until the “last minute”. As a result, they find themselves without a plan and ill-equipped to handle a successful transition.
Myth #6 – Lawyers, accountants and insurance agents are family business owners’ best advisors
Yah, not so much. The truth is, most professional advisors are competent in their respective field of specialization and can properly handle general business issues. But, (and here’s the “but…”) problems that are specifically related to family businesses require additional skills that few professional service providers possess.
Maybe this is a good time to point out that growing up in a family doesn’t make one an expert on solving family problems either, especially problems in your own family. In reality, family members and outside “general purpose” professionals are quite poorly suited for dealing with family specific business challenges. On the one hand, they’re too close to the problem. On the other, they’re too far from it.
