Dan Schneider

Beware of the “One Size Fits All” Succession Plan
October 22, 2007

Lately, some public service organizations have been running television commercials that give us a wonderful picture of why money-centered web scams don’t work in a face-to-face environment. I wouldn’t go so far as to call some succession planning approaches a scam, but I have no reservations about stating publicly that a “one size fits all” succession planning approach doesn’t fit all.

This point got driven home to me again just a few days ago. During a presentation to a group of about 25 people whose net worth easily placed them in the neighborhood of the top 1% of the U.S. population, one of the participants was having trouble understanding why the real-life example we used in our case study had chosen a different approach to estate planning and stock transfer than he had chosen to use with his family and a few minority partners.

After more minutes of discussion than it should have taken to get the point across, Jack (not his real name) connected the dots. Owner Perspective and Motivation is what we call it; or, as another participant said, “Different strokes for different folks.”

Our experience has shown that many of you who have achieved a high level of financial and business success are much warmer, more sensitive, and more loyal to business friends and strategic partners than the general public wants to recognize. So, for whatever reason(s), you will stay with people who don’t always have your best interests in mind. As an example, one of our newer clients with a net worth in the tens of millions had been talked into an annuity for a reason that had nothing to do with his needs. It had everything to do with his advisor’s business. His advisor sold annuities.

So, as you begin your due diligence on a succession planning partner, here are some considerations for you to keep in mind:

1. Know what you want to have happen and pick someone to work with who will put your interests and needs first. Build your plan around what you want to have happen. Letting someone else build a plan misaligned with your goals will be just as uncomfortable as wearing shoes two sizes too small or two sizes too large.
2. Remember that your business is a forum for continuing family fellowship, values, and careers. Family is more than blood. It’s two or more people gathered together for reasons beyond making money.
3. Your business is a powerful vehicle for impacting your community. In fact, the family business is one of the powerful economic engines in the world. It is the ticket to Living the Dream.

So, whether your dream wears a 6AAA or 16EEE, shape your succession plan so that it gives you pride, pleasure, peace of mind, and the profit that makes everything you’ve dreamt come about. It’s more fun to live your own dream than someone else’s.

Posted by Dan Schneider on October 22, 2007 | Comments (0)