WHOSE JOB IS IT
TO TAKE THE LEAD
IN FAMILY BUSINESS
SUCCESSION PLANNING?
John Berry
Ag Marketing Agent
Lehigh County
Succession planning is one of
the most crucial activities that
any family owned company un
dertakes. Of course, there are
several crunch points in a family
company’s life.
Start-up is a dicey time for
any business, and a vast major
ity of those that are launched hit
the pad again nose-first not too
much later. Then there’s the
growth leap, the point when the
business expands beyond the
family style organization, man
agement systems, and controls
of its early years. If the business
can’t adjust to the demands of
increased volume and complex
ity, it can fold under the weight
of its own success.
Another major crunch point is
the period when decisions about
the business’s continuity under
family ownership and manage
ment are made. It’s hard to
overstate the importance of
planning and executing the ac
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tions that ensure that continuity.
Succession planning is the key
to maintaining the family’s own
ership of the business with mini
mal tax exposure and risk to the
business’s stability. It’s the key
to a smooth transfer of manage
ment authority and responsibil
ity from one generation to the
next. And succession planning is
the key to a comfortable and
rewarding retirement for the
senior owners who have spent
their working lives building
their family’s financial security.
So with all that’s at stake,
who’s responsible for focusing
the family’s attention on succes
sion issues, setting up the sched
ule and mobilizing resources,
securing professional help when
it’s needed, and guiding the pro
cess to a successful conclusion?
The senior owner? The rising
successor, or successors? Other
concerned members of the
family? Loyal long-time employ
ees who know that successful
succession is necessary for the
company’s ongoing health?
The answer is all of the
above. Succession planning in
volves all the major actors in one
way or another, at one time or
another. It’s especially import
ant that key family members see
eye to eye on several key points
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right up front. The senior
owners, the rising generation,
and other family members who
hold stock, or hold a stake (not
always the same thing), in the
company must agree on the fol
lowing:
• The family wants to retain
ownership of the business after
the founding, or current senior,
owners step down from execu
tive leadership.
• The business is stable and
profitable enough and its future
in the marketplace is bright
enough to justify keeping family
ownership into the next genera
tion.
• The rising generation in
cludes persons with the basic
qualifications and commitment
to run the company successfully.
• All key family members are
ready to undertake a systematic
process of analytical assessment,
planning and transfer that may
take years to complete and call
for some very tough choices.
• The senior owners are pre
pared to manage in a business
like fashion a succession
planning and transition process
that will ultimately result in
their handing over leadership
and letting go of decision
making authority.
• The rising generation and
prospective successors recognize
that an important obligation of
the business will be to provide a
financially comfortable retire
ment for the family members
stepping down.
• All family members agree
that preserving the business as a
healthy, growing enterprise with
a solid foundation and a bright
future into the next generation
and beyond takes precedence
over all personal wishes of
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New York Farm Bureau
To Host Satellite Conference
GLENMONT, N.Y. As
part of it’s annual policy devel
opment process, New York
Farm Bureau, the largest farm
advocacy organization in the
state, will host a statewide satel
lite conference for farmer mem
bers and prospective members
on Wednesday, July 19 at 7 p.m.
With farmers busy in the
fields all day, the utilization of
satellite technology will mini
mize time away from the farm,
as about 30 downlink sites
across the state will be made
available.
The satellite conference is
aimed at involving farmers in
the process of identifying and
discussing the pressing issues af
fecting agriculture today.
“New York Farm Bureau is a
grass-roots organization and
members need to be heard,”
stated John W. Lincoln, New
York Farm Bureau president.
“We rely upon the policy devel
opment process as the backbone
of our successful efforts to serve
and strengthen the agricultural
industry. This is an important
event that all farmers have a
family members.
When a business-owning
family comes to terms on those
key points, then a good ground
work has been laid and succes
sion planning can begin, with
much better-than-average pros
pects for success.
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RD#l, Box 418, Milton, Pa. 17847 ]
Phone: 570-523-9598 A
Lancaster Farming, Saturday, June 24, 2000-D3
stake in, members and non
members alike.”
New York Farm Bureau staff
and leaders will present the vari
ous issues which they have been
following in Albany and Wash
ington, D.C., that have the po
tential to impact agriculture in
the next year. Through phone
and fax lines, participants will
have the opportunity to raise ad
ditional issues for discussion, as
well as to ask questions and
receive immediate responses.
In addition to the policy
issues that will be discussed, rep
resentatives from the State In
surance Fund and Cornell’s
College of Agriculture and Life
Sciences have been invited to
make presentations.
Satellite downlink locations
include the following County
Cooperative Extension offices:
Broome, Cayuga, Cattaraugus,
Chautauqua, Chenango, Clin
ton, Delaware, Dutchess, Erie,
Franklin, Fulton, Greene,
Monroe, Niagara, Oneida,
Orange, Oswego, Schoharie,
Steuben, Suffolk, Tioga, Tomp
kins, Washington, and Wyo
ming. Also linked are Jefferson
County Community College,
SUNY Morrisville, Geneva Ex
periment Station, and SUNY
Potsdam.
For more information, con
tact New York Farm Bureau at
(800)342-4143.
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