About the Author
is a full-time mediator, group facilitator
and family business
advisor practicing in
New York City and
He can be reached
About the Author
L. CARAS, J.D.
is a mediator and
with the Maine-based mergers and
Leaders LLC. He
can be reached
of at least $200,000 and to ensure that their families
were adequately provided for.
Bill and Bob also agree that they should consult a
family business mediator.
LEADERSHIP SUCCESSION ISSUES
Like many successful family-owned businesses,
Bob and Bill have waited until late in the game to talk
about arguably the single most important factor in
whether their business survives to the next generation: leadership succession.
Bill and Bob agree that they want the business and
the family to survive. They want SGS to continue to
be family-owned and family-run. They also recognize
that decisions must be made based on what is best
for the business with due consideration of family
relationships. They accept that, along with the key
business leaders Jeff Hackett and Sam Winslow, all
family members by blood and by marriage must be
involved in devising the succession plan.
This last point is critical. Many business owners (and
some mediators) might be tempted to take a limited
view of the conflict and treat it as a dispute between
Bob and Bill, the founders and decision-makers. But
to get succession right, the conflict cannot be viewed
as simply one between Bob and Bill as individuals.
They are part of a family system and any actions by
them (and any other members of the family) impact
the entire family network of relationships and the
family business. Leadership succession involving
family members in the business must consider the
family system. To sustain the business into the next
generation and beyond there must be alignment
of the family’s values, goals and expectations with
those of the business. To determine those elements
and ensure their alignment, the entire family and key
members of the business must be involved.
The mediator would use a multi-step process, for
example: 1st stage, fact-gathering interviews; 2nd stage,
succession plan development meeting with Bob and
Bill; 3rd stage, succession plan assessment/refinement
meeting with all interested parties; 4th stage, implementation (the mediator’s involvement optional).
Interviews. The mediator should maintain complete
confidentiality for all interviews unless agreed other-
wise, keep discussions focused on interests and needs,
not positional stands, and invoke objective standards
and business benchmarks to help create solutions.
The mediator may even suggest engaging additional
experts. And the mediator should hew to two bed-
rock tenets of successful mediations: start by finding
agreement or alignment on easier issues; and strive for
complete ownership by including all interested parties
in the process of drafting the succession plan.
Interviewing Bob and Bill separately, the mediator
might ask questions like these (and adapt them for
the interviews with the other parties):
1. What outcomes would you like to see as a
result of this process?
2. What will the business look like in 5 years?
In 10 years?
3. How are major decisions currently made in
the business? In the family?
4. What do you see as the biggest challenges
to the business going forward? To the
5. What do you see as the greatest strengths
of the business going forward? Of the
6. How are conflicts in the business resolved?
In the family?
7. What will the family look like in 5 years? In
8. What will ownership of the business look
like in the next generation?
9. By what date will you and your brother turn
over leadership of SGS?
10. What are your core family values? Your core
11. What qualifications do you deem essential
for the next leader(s) of SGS?
12. If no family member has the necessary
qualifications would you agree to non-family
13. What role do you see for your children and
their children in the business?
14. What are their expectations?
15. Have you shared your feelings on the
future of the business with other family
16. What impact would losing Jeff Hackett (VP
sales) and/or Sam Winslow (VP operations)
have on the business?
17. Are you willing to commit the necessary
company resources to see the leadership
transition and the company succeed?