Psychological and emotional factors are other common stumbling blocks to the disposition of a business. The sense of pride drawn from growing a successful business can make it difficult for an owner to relinquish control, even when age and common sense says it's time to pass the torch — a point that successful advisers learn early in working with this market.
Ideal Succession Plan Goals
Ideally, a good succession plan would provide for the owner to retire and install a successor during his or her lifetime. Good planning might also suggest that the founder groom the successor early in his or her career with the company. The ideal plan would find the company founder, even though retired, available for advice, if solicited by the new owner(s), but also removed from having any influence on the company's operations or even strategic plans.
The problem is that ideal plans are hard to come by. Human nature and emotions interact to thwart even the best-intended plans. In your role as agent, you have the opportunity to play an important part in your business clients' succession plans, especially when they involve family members: You are the objective third person. Provided they trust your knowledge of business succession planning, your judgment, and your fairness, then your clients may well look to you to mediate planning discussions.
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