Warning! Why you should Set Performance and Expectation Standards for Family Member Employees

Now, for the conclusion of my letter to Successor. My straight talk concludes with a focus on his “good guy” leadership style, especially in regards to family members working in the business... On the subject of a culture of tolerance versus teamwork, I am concerned about your “good guy” compulsion to expand the list of family member employees who are effectively, non fire-able employees. You may argue that you could fire anyone, but understand the definition of a non fire-able employee: someone, including but not limited to a family member employee, who will not be held accountable to the point of termination barring significant brain damage that impairs the attitude of the leader, harmony of employees, harmony of the family and/or a combination thereof.  To read the end of this blog, click here.

A Lesson from Football – Take a Half-Time Break

Here is the last post in my partner, Jeff Faulkner's, three part series on reviewing your estate and business succession plans. I hope these posts have encouraged you to take a look at and review your own plan. In my previous two posts, I’ve discussed a couple of situations in which significant changes occurred that necessitated updates be made in the succession planning arena. Fundamentally, succession planning is a strategic planning process.  Just as in your annual forecasting for your business, you have to review your plan on a regular basis to determine where you are relative to where you want to be, and make adjustments as necessary. As an example, one of the things that many of our clients need to do is build up more liquidity apart from their operating businesses.  It is a truism that you will find it hard to let go of your business if you are financially dependent upon it. So, in the planning process, we help our clients identify and define what personal financial security means to them and then help them develop a plan for achieving that security apart from the operating business over a period of time.  If they say I want $1 million in liquid resources and they are currently at $200,000, then we develop a plan to get them there and then we hold them accountable to that plan. What I have learned over the years is that with any type of strategic planning like this, the plan never, I repeat never, works out in a linear process. It’s a dynamic process with ebbs and flows.  What I’ve also learned is that if you don’t follow this type of approach to planning and just hope it happens, the ebbs and flows will always, I repeat always, keep you from achieving your objectives. This is one of the reasons I love the way football games are structured with a half-time break. It gives the teams and coaches an opportunity to evaluate their game plan, what’s working, what’s not working, and sort out what needs to be done differently. So, if you have put a plan in place but have not reviewed it in a while, do yourself and all who are depending on you a favor, and take a half-time break to evaluate your game plan, what you’re doing well, areas you need to improve, and update your game plan. How often do you think is best to take a "half-time break" and review your estate and business succession plans?

Family Business Issues: Letter to a Successor – Being a leader means you can’t always be the “good guy”

Let’s continue with my letter to the “Successor,” reflecting my frustrations with his recent performance. We pick up where my straight talk begins to focus on “Successor’s” effort to buy affection and respect... I hope you found our recent Board meeting worthwhile. As I expressed leaving the meeting, I regret the need for my grinding in regard to you establishing and communicating reasonable performance expectations and formal protocols for expenses, 401k match, profit sharing, pets and hiring family members. All these things continue to support my concern about your compulsion to be known as a good-guy and a propensity to attempt to buy respect and favor from family and employees. To read the end of this blog, click here.

Change of Heart Leads to Change in Plans - Is Your Succession Planning Strategy In Alignment?

Another situation I dealt with recently during an annual review of planning involved what I refer to as a “five minute bomb.”  Five minutes before the end of the meeting with a client, when I’m preparing to leave and go home, he says to me “oh, there’s something else I forgot to tell you” and it is inevitably an intense subject that requires much more than five minutes to handle. “Oh no! Here it comes,” I think.  Sure enough, it’s a big, hairy issue. Whereas I used to feel anxiety about these bombs, I have come to rely on these as opportunities for further engagement and building client reliance upon me as an advisor. To read the end of this blog, click here.

Successor Development Challenges - Don't Alienate Key Managemen

Some clients appreciate what I offer more than others. In many cases this occurs when a very social child follows a task master parent into the CEO position of a business without appropriate experience, effective accountability, mentoring or coaching. In the absence of working for another business, successors lack the understanding or empathy of an employee. If a successor has never been a common law employee, it is very difficult for them to effectively lead or manage employees. Furthermore, if a successor is never provided employment performance guidelines and held accountable to those metrics, it is very difficult for them to manage and lead those who are aspiring to make their mark on the business world, gain status and gain security.Read More To read the end of this blog, click here.

When Tax Laws Change, Estate Plans Need Review

I sat down with a long-term client earlier this week and was reminded once again of the importance of regularly reviewing your estate and succession planning. This client is the majority owner of a family owned company and has his children involved in leadership roles. He is in his second marriage to a woman who is not his children’s mother. To read the end of this blog, and find more like it, click here.

Effective Leadership - Hub and Spoke Eventually Chokes

Last year while reading the Orlando Business Journal I came across a one liner that read, “the sign of a good leader is when the business runs as smoothly when the leader is in the business as when he or she is out of the business.” As a succession planning professional dedicated to impacting lives and perpetuating family business legacies, this quote resonated with me. While it occurred to me that the title of this article sounds like a quote from Johnny Cochran, the hub and spoke approach to management and leadership impedes the business’ ability to operate smoothly when the business owner (the hub) is away from the business. And from a succession planning perspective, this can be devastating! To read the end of this article, click here.