Entering A Family Business

Question 1

What is succession?

Answer 1

Is the process in which the leadership of the business is transfered from the existing leader to a subsequent family member or non family member.

Question 2

Barriers of succession?

Answer 2

1. Inability to choose a successor.
2. The leader selects a successor to be a slave.
3. A denial of mortality.
4. A founder refuses to transfer leadership.

Question 3

Discuss the types of leaderships styles.

Answer 3

1. Monarch - Do not leave the office unless forced through death or revolt.
2. Generals - Forced to leave the office but they plot their return.
3. Ambassador - They leave gracefully and frequently serve as post retirement mentors.
4. Governor - Rule for a limited term, and then they retire. They switch to other vocational outlets.

Question 4

What are the succession options?

Answer 4

1. Appoint a family member.
2. Liquidate the business.
3. Do nothing.

Question 5

Roles of the advisory board.

Answer 5

1. Primary role is to provide advice
2. Ensure that descions are in line with the family value system.
3. Manage conflict timeously
4. Ensure that descions are based on reason instead of emotion.

Question 6

Roles of family counsils.

Answer 6

Oversee family matters such as the family’s philosophy, employment criteria and succession planning.