SUCCESSION PLANNING

According to the most recent RMIT Family Business Survey,“more than 75% of family businesses have no written management or ownership succession plan” – which category does your business fall in?

As family business owners start to plan their retirement and how they will exit their business, it is critical that the business puts in place a well considered & structured ‘Succession Plan’.

A ‘Succession Plan’ needs to consider a range of matters such as:

Where it is likely that a business will remain family owned (generational succession), a ‘Family Business Constitution’ is usually the most effective way to outline how control & ownership is held, how the business is to be managed (incl. key philosophies/core values, board composition & decision making, family salaries & performance reviews), the process for family members wishing to enter & exit the business, how equity can be transferred, guidelines for issue resolution, etc.

In addition to having a ‘Family Business Constitution’ in place, establishing a ‘Family Council’ can be another effective and rewarding way to facilitate open discussions around conflicting family & business issues, and help ensure family harmony.

For those owners intending to sell their business to fund their retirement, having a formal ‘Succession Plan’ in place will enhance the value of the business.

Our EISOne tool can also be a powerful way to maximise the value of your business. The tool can be used to measure the current value of your business and highlight what you can do to improve its value. Equally EISOne can be implemented as a management information tool within the business, improving the quality of ‘management systems’ and thereby overall value of the business.

Click here for our brochure on "Succession Planning"

Click here for our brochure on ‘Balanced Scorecard, KPIs & EISOne’.