Become a High Impact Owner Through Business Succession

A few simple but powerful steps that will lead to peace of mind and high impact when it comes to succession planning for your shop.


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If you’re like most owners, just the thought of facing succession planning builds a big knot in the pit of your stomach. If there’s a good way to avoid it, you’ll find it. Your attorney, accountant, board and family may have reminded you of the need to get it done and yet it remains incomplete. You might argue that you’ve tried hiring consultants and they didn’t really understand your situation and never gave you practical solutions or guidance on how to implement. While that may be true, that excuse won’t work forever because the problem is still there and needs attention. To begin with, business succession decisions are subjective and can’t always be measured by numbers. Good succession planning forces you to consider your values and how you will spend your time and money for the rest of your life. Over the years, three critical business owner blind spots have been identified.

  1. Lack of clarity regarding life purpose after work.
  2. Lack of coordination between different aspects of your financial life.
  3. No system of ongoing estate and financial management to ensure peace of mind after you’re gone.

Which blind spot hits home with you?


Getting Started

If you’re like most owners, the person you think of first is your attorney or CPA. You pay them for advice on legal and tax matters and business succession is a legal and tax matter, isn’t it? Not so fast, while legal and tax advisors are great resources for specific technical advice, they often fall short when it comes to planning and helping sort through complex family dynamics and non-financial issues. To begin with the end in mind, start by considering the following question: What do you want to be remembered for?

Most business owners want to be remembered for leaving a positive impact. To make wise decisions about your business, you first need clarity about yourself and what you want to do. To understand yourself better, consider the following Owners Action Drivers™, Fear, Love, Anger and Greed. Together they spell F.L.A.G. ™


Fear of failure affects everyone. It’s not just money at stake; it’s position, power, respect and reputation. Succession is a critical transition where failure is visible to everyone. Most owners fear losing control.

By integrating life purpose into the financial equation, we find owners are able to overcome their fear of losing control because they actually gain more control through the process. Loss of influence also is a fear that can be addressed when you better understand your life purpose. Conflict, loss of control, influence and/or failure. What fear hits home with you?


Owners who care deeply about their employees often struggle with conflicting emotions especially when family members are involved. Entrepreneurs love the freedoms that come with running a business, but they hate the complexity involved with managing people. They love control over their time, but hate the confusion that comes from having so many choices. Without a planning process that integrates your emotional drivers, it’s unlikely you will make significant progress in your succession planning. What do you want to protect, preserve and transfer?


Anger can be a powerful motivator: Properly channeled, anger is often the fuel that creates empires, but it has a dark side as well. Anger can poison relationships and destroy your health. A great succession plan will help you focus your anger into the energy necessary to complete a high impact and integrated succession plan. Is anger working for you or against you?


Most owners are not driven solely by greed. In our context, greed is about self-interest and high impact owners need a balanced approach to self interest and their obligations to others. Unfortunately, we rarely see evidence of a planning process that clearly defines financial independence with both spouses in mind. There is a Financial Independence Profile™ designed to clarify financial independence goals for both spouses into a single one page visual diagram. How much is enough and how much is too much?


Many Cooks, But No Recipe?

Business owners compartmentalize their planning by hiring technical experts in multiple disciplines in hopes that more heads will result in a better plan.

You may have All Star individuals that fail to act as an All Star Team. Also, without a clear roadmap that defines your goals and values, all of the technical experts in the world can’t help you answer questions such as: how much is enough for you and your spouse, how much is too much for your kids, how well prepared is your spouse to manage things after you’re gone, who should lead your company and is fair always the same as equal?


Creating Peace of Mind

A new approach to succession planning integrates family and emotional issues with creative legal and tax tools to create lasting peace of mind and high impact ownership.


Go Public Privately

An important succession tool often overlooked by small business owners is to “go public privately” through an employee stock ownership plan or ESOP. While an ESOP is not for everyone, the tax benefits and flexibility for closely-held companies are powerful incentives. We believe that every successful company with an appraised value of 3 million or more should go through a feasibility process to consider an ESOP strategy. Smaller companies can consider employee ownership, but need to be mindful of the cost and complexity.

Although employee ownership has been around for a long time, the tax incentives that created ESOPs as we know them today have only been around since 1984. Often ESOPs are not well understood by owners and professional advisors and as a result are not recommended as often as other forms of business structure.

Ultimately, an ESOP is a flexible and tax-efficient way to create liquidity while retaining control over your business.



High impact succession planning should begin with a process that helps owners gain clarity on their mission, vision, values and goals. Developing a strategy that integrates your family, business and community objectives should then follow. Once implemented, a high impact succession plan needs a regular system of maintenance that keeps the plan fresh and up to