Generational Transition (Second to Third Generation)
The owner of an Industrial Service company that had been in business for over 35 years planned to transfer ownership and management of the company to his son. The father and son, however, had very different interests and management styles. In addition, the business — although successful — was too centrally organized around the father, and destabilized a bit by his interests in creating new product lines and searching out new strategic partnerships. The son, also, had not had a chance to prove himself as an independent business manager.
Our objective was to help develop and implement a five-year transition plan, that would leave both the father and the son happy with the outcome and — at the same time –produce a more stable and robust business overall. Some of the steps we proposed included:
- Defining the type of business that the son would be excited about running
- Creating an opportunity within the business for the son to have a test run at functioning independently
- Building a strategic plan for critical business functions throughout the business, assessing what other managers existed or would be needed
- Creating a clear map for the father, so he could envision his transition from head of the business to consultant for the business
Throughout the process, we:
- Held the father & son accountable to quarterly action items by updating working plan at facilitated quarterly full day sessions, and coaching father and son through difficult conversations
- Provided leadership coaching to son and his future management team
Four years into the process, 80% of the functions performed by Dad have been transferred to son and other managers. The business as currently structured operates in greater alignment with son’s skill set, leadership style and values. The son has demonstrated himself to be a very capable leader. There has been a significant shift from centralized control of the business (that was centered exclusively around the father) to a more dispersed decision-making process — which allows for greater ownership and accountability for business results by individual managers. Overall, managers are more focused on the core business (with less distraction from Dad’s forays into other conversations). Profitability is up and both the father and the son report increased personal satisfaction.