A succession in a family business is not a simple process and is often postponed, because preparing the next generation to take on such responsibilities It is a complicated and especially emotional task, with potential barriers between parents and children, with differences in criteria between siblings, in-laws, etc.
“To achieve effective planning, private companies require the owners to consider many factors, each with possible personal conflicts of a certain magnitude, and a control agent. At least three options for generational transition need to be addressed: business continuation; sale as a going concern before the value of the assets is impaired; or the liquidation of assets to meet business obligations and maximize the residual value to be distributed in the family”, comments José Torres-Llosa, partner in charge of Interim Management at Amrop Peru.
So, how to make this succession successful and not have to choose to sell the firm or liquidate it? According to Torres-Llosa, there are three steps that can guarantee a higher percentage of success in the transition:
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1. Develop a plan to determine the course to be taken. To do this, according to the path chosen, there must be a duly documented plan, the identification of the person responsible for carrying it out, their role and obligations, the monitoring of the processes to be followed and their updating, as necessary.
2. Choose a control agent. This is a decision that should be made as soon as possible, because when there is a loss of internal leadership from the family management, the leadership void is immediately felt by company staff. The obligation of the control agent is to ensure that the approved plan is carried out.
3. Opt for an Interim Manager. When there are no planned and trained successors at the time of transition, the premature selection of a long-term manager can increase anxiety in the company, instead of leading to calm. In these cases it is advisable to use the services of a Interim Manager who can fill the eventual void in the administration until the successor foreseen in the plan can take over.
“The good thing about hiring an Interim Manager is that, once their work is finished, they will leave the company in search of new challenges that allow them to pour their knowledge and experience into other companies,” concludes Torres-Llosa.
