The 2016 Summer Olympics begins 5 August in Brazil. I expect to notice the men’s 4 x 100 relay. You can learn quite a lot about business succession planning by watching it.
The key to success, other than speedy runners, is the pass. Drop the baton and you lose. Pass it outside the passing area, you lose. Pass it before the next runner is up to speed or after the first tires, you probably lose.
In business succession planning think of the baton as containing all of the information, skills, experience, insight and standards that has served the business owner well during their leg of the race. Let’s look at the pass.
The passing area or exchange zone is crucial. The approaching runner cannot slow down yet, and the next runner must accelerate to speed without running away from the first. There must be a place where they match speed and pass the baton.
In a business situation there will be quite a lot of preparation. Learn to run fast, find ways to co-exist in the pass area, develop a technique to pass the baton. Practice and share experience.
The pass must be firm and it must happen when both are ideally positioned. The second runner must put his hand in position and accelerate without looking back. He trusts the first runner to make the connection. If the first runner holds on too long, or passes it too hard or too soon, the baton will likely drop.
The baton in the Olympics race is just a hollow aluminum tube. The baton for your business is more complicated. It is your history. A large part of your life. Experience that was costly and difficult to own. Be sure that the baton contains all that matters and be sure the next handler knows what it means.
Building your baton begins very early. Children will pick up your values young. The way you treat others, your ideas of fair, the duties you accept and those you refuse, your time scale – patient or not, thorough or haphazard, organized or frenetic. Succession begins as soon as there is a successor.
Of course, the child may choose another course for their life, so the detail may not pass at all.
Some will want to carry on.. When they are working in the business, they can learn about product, processes, quality control, customers, suppliers, employees, bankers, lawyers, accountants, competitors, taxes, advertising, engineering, cash flow management, bookkeeping and governmental regulation. The order likely matters but it is different for each business. Founders often don’t know what they know and that knowledge may not pass. That can be serious.
In 2008 in Beijing, the Americans were the odds on favourite in the 4×100, but failed. As ESPN noted, Tyson Gay reached back to grab the baton “and there was nothing.”
Business transition is a delicate process. Using the relay race paradigm sometimes helps people to hold perspective. The fastest do not always win. It requires exquisite teamwork or it fails. There is little room in the middle.
Don Shaughnessy arranges life insurance for people who understand the value of a life insured estate. He can be reached at The Protectors Group, a large insurance, employee benefits, and investment agency in Peterborough, Ontario. In previous careers, he has been a partner in a large international public accounting firm, CEO of a software start-up, a partner in an energy management system importer, and briefly in the restaurant business.
Please be in touch if I can help you. firstname.lastname@example.org 866-285-7772