16 | The Jewelry Business Magazine GREAT PLAN SUCCESSION Agreatsuccessionismoreorlessanon-event.It’sanevolutionary process created through careful planning, artful leadership, and efficient management. It arises over a period of years with clear expectations and final results that surprise no one. Succession in a family business generally means the transition of leadership from one generation to the next. Sometimes families don’t have children who want to take over or have the capacity to do so, but a succession transition can still take place. It’s more a process of planning and preparation than anything else and should be based in large part on the desires and needs of the retiring generation. But succession planning isn’t easy. If it were easy, anyone could do it. Planning for business continuity is a process that begins before you even feel you need a transition plan. It entails many of the following elements: • Laying down principles and values that are important to you as owners • Exposing your children or relatives to the positive aspects of the business at an early age • Establishing a family mission and vision statement so everyone is clear on your direction • Orchestrating careful and conservative financial planning so you can retire comfortably • Finalizing the owner’s estate plan and also a strategic business plan for the future • Identifying a possible successor or successors and helping them develop personally and professionally • Helping other possible family or non-family members map their own career paths • Building a family council or team of owners and managers to help set priorities • Being extraordinarily clear on expectations of everyone involved in the process • Committing to frequent and wholesome communication on any issues of importance Not all of these elements will apply to every family business. Frankly, not all owners want the business to succeed them, and that’s fine, too. The key lies in owners determining what will make them happy and developing a plan that fulfills their wishes. Every situation is different and should be handled individually. There is no “one best way” to proceed in succession. A lot depends on the people involved and the circumstances revolving around the business. Consider this scenario between a father and a son: FATHER “I owe my son much more than he owes me. He is the future of the business and has made a mark on it at an early age. SON “No Dad. I owe you much more. You built this business to what it is today. I just feel privileged to be able to take it over and hopefully grow it the way you did.” FATHER “I respectfully disagree. You have earned the right to be in charge and have gained my deepest confidence. I know our business is in good hands.” SON “Thanks very much, Dad. You’re the greatest. I respect you and your vision for the future.” Unfortunately, this isn’t the norm. Here’s another scenario that is all too common: FATHER “I know you want me out, but you’re not going to get it. You need to show respect to me and have patience in not wanting too much too soon.” SON “All I want to know is where I stand and when I can expect to be taking over. You tell me I’m doing a good job, but I want to know where my future lies.” FATHER “You aren’t prepared to be in charge. There is so much you don’t know. I can’t imagine relinquishing the reins of this business any time soon.” SON “That is part of the problem. You’ll never feel I am ready and I’ll likely have to wait until you’re gone. That’s not a succession plan. It’s a poor excuse for your own insecurities.” A family business that has an effective and efficient succession plan has the following benefits: • The emotional joy of knowing that the business is part of the owner’s legacy, and the result of his or her hard work • The confidence that every family member plays an important role in carrying on the family heritage • The value of shared decision-making in the family toward agreed-upon business goals • The assurance that the company can and will retain the best talent for future success • The opportunity to bring fresh new perspective to the business that is adaptable and can revitalize strategy as society and the world changes Ask yourself if this is what you want, and then decide how you want to get it. It’s worth your time and effort to have a great succession plan. What Does a Look Like? By Bill Boyajian Bill Boyajian Bill is the former long-time president of the Gemological Institute of America, and is currently founder & president of Bill Boyajian & Associates, Inc. His company consults for a wide variety of businesses in the gem and jewelry industry, specializing in leadership, business, and organizational development, family transition, and succession planning. Bill is the author of Developing the Mind of a Leader – Your Path to Lead and Inspire People. He is a sought-after business coach and speaker, and can be reached at email@example.com.