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Succession Planning – Begin with One Small Step

Feb 7, 2023
By Leron Lehman

Categories: Family Business Transition & Succession Solutions

Succession Planning – Begin with One Small Step

There is a simple model of human behavior that says we only do things when we have a strong enough reason to do them; on the motivational scales in our brains, the benefits must outweigh the costs. Another way of saying this is that you need to find your “why.” Simon Sinek, author and speaker, has popularized this idea and it’s highly useful in many areas of organizational and personal planning.

How would we apply this behavioral model to planning for the future of a family business? Why should we implement a strategy for the transition of ownership and leadership from one generation to the next? There are many obvious motivations:

  • Do what’s right for the customers and employees
  • Leave a legacy for family
  • Ensure the future health and success of the company
  • Allow the next generation to reach their full potential
  • Minimize future taxes
  • Preserve wealth

This all seems fairly straight-forward. However, our intuitive model of human behavior assumes we are rational beings who have the ability to objectively perceive and evaluate our circumstances. We are not. Newton’s first Law of Motion describes a core physics principle – an object at rest tends to stay at rest. There is a similar principle that describes the behavior of humans called the status quo bias. Unfortunately, we are often not driven by logic or rational thought; most of us prefer to maintain the current state of affairs. Change (even positive change) is often viewed with suspicion, and we adopt all manner of coping mechanisms to deal with it. Denial. The Ostrich effect. The Bliss of Ignorance. Research has confirmed over and over that most people are prone to procrastination when it comes to planning for retirement, their estates, and for the future of their businesses. Most business owners know how to run their business but are not well equipped to grapple with the emotional, relational, economic, legal, and tax issues of business succession. There are plenty of obvious reasons to get started, but it is confusing and overwhelming, so we procrastinate.

If this sounds a bit depressing – fear not, there is hope. Productivity experts consistently point out some ways to overcome this glitch in how we deal with change. One good strategy is to find someone to talk to that will encourage you and hold you accountable. This could be a spouse, business partner, mentor, friend, or even a professional advisor. Unloading your stress, uncertainty, and emotions has a way of disarming them. We all do better when we have someone to share our burdens and nudge us in the right direction.

Finally, just get started. Take a small step and let the momentum build. The second part of Newton’s first law is that an object in motion tends to remain in motion. After the initial push, progress becomes much easier. Even the longest journey begins with a single step.

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