Recipe for a Successful Transition

Takes an average of 8 years

Mix all ingredients below with equal parts regular, productive meetings and good humor every quarter for an average of 8 years.

When documents are complete store in binder or secure, on-line location that everyone knows how to find and can access.

Family

• Strong family bonds

• Healthy family communication

• Strong family traditions

• Estate plan that is reviewed yearly

• Will(s) that is/are updated yearly

• Insurance

• Family philanthropy plan

• Trusted (by all generations) advisors - legal, financial, insurance

• Determine who will be the next CEmO

Business

• Core values

• Core focus™

• 10-year target™

• Marketing strategy

• Three-year picture

• One-year plan

• Rocks

• Issues

• Method for working through issues

• Strong leadership team

• Quarterly meetings to stay on track

• Annual meeting to build trust, look at strategy, and make next year plan

• Board of advisors or directors

• Board bylaws defined, followed and reviewed yearly

• Emergency/crisis plan for leadership, reviewed yearly

• Next generation leadership development plan in place

• Compensation plan in place and reviewed yearly

• Insurance, reviewed yearly

• Philanthropy plan

• Trusted advisors (by all generations) - legal, financial, insurance

• Determine who will be next leader

Ownership

• Values

• Legacy defined

• What do you want things to be like in 10 years

• Defined ownership philosophy

• Determine if family first or business first

• Clarity about relationship with board of advisors or directors

• Do you require pre-nuptial agreements for next generation owners?

• Plan (3 year, 1 year and next 90 days)

• What do we need to solve list

• Effective method to work through issues

• Effective method to understand the health of the business without being there day to day (can include score card, monthly same-page meeting, etc.)

• Buy/sell agreement in place, aligned with values and legacy and reviewed yearly

• Plan to fund buy/sell agreements in place

• Annual ownership meeting (2-3 days)

• Quarterly ownership meetings (full day)

• Monthly ownership meetings (2 hours)

• Next generation leadership development plan in place

• Insurance, reviewed yearly

• Philanthropy plan

• Governance structure for business defined

• Governance structure for foundation defined - optional

• Governance structure for family office defined - optional

• All important documents in one place such as a safe or safety deposit box and that location communicated clearly

• A binder with copies of updated/important documents and contact information, updated yearly

• Family history (book or videos)

• Have a great relationship with family office

• Key advisors (legal, financial, insurance) for each generation

Optional

• Family office 

• Family foundation 

What you need in the binder 

updated minimum of once per year

• V/TO™ for business

• Answers to six ownership questions

• Emergency/crisis plan with all contact information included

• Buy/sell agreement

• Family meeting agenda/notes

• Business plan

• Strong business leaders names and contact information

• Family, ownership and business leadership roles defined

• Family business board

• Optional - family office (governance articles bylaws)

• Optional - family foundation (governance articles bylaws board info)

• Emergency plan for business leadership

• Compensation plan

• Clear information about where official documents are held (safety deposit box?)

• Articles of incorporation for the business

• Board bylaws

• Estate plan

• Key advisors for each generation name and contact information

• Shareholder listing

• Wills

• Contact information for all owners

• Distribution policy

• Prenups

• Employment policy

• Insurance

• Family history video or book

• Philanthropy plan

• Next generation leadership development plan

• Next generation ownership development plan

• Next generation family tradition development plan