Successful business succession - a personal, emotional decision

There are probably few issues in business life where the importance is in such high proportion to the solution. Company succession in small and medium-sized enterprises.

In Germany, by 2022, “more than half a million of the owners of small and medium-sized enterprises (SMEs) are planning a business succession (Dr Michael Schwartz, KfW Research, Fokus Volkswirtschaft, No. 197, 23 January 2018).

Many family businesses go under after only a few generations after being successfully founded. It is often not possible to pass on the energy of the founder to those who follow. When the founder or current owner retires, the new generation of successors may be completely unprepared or unqualified for the new tasks or simply not interested. In distress, a well-established business may then be sold to a competitor at a reduced price or drift towards failure instead of continuing to grow. Good employees may lose their jobs; the best may leave, taking essential skills and knowledge with them.

Why do entrepreneurs find it so difficult to find a successor to their company?

Is the reason the number of qualified applicants is low, or are the questions more complex?

Is a lack of willingness on the part of entrepreneurs to take an economic risk one of the causes?

Is it perhaps (also) because the entrepreneur makes too high financial demands on the successor?

Does the entrepreneur see the implementation of the business succession as a time-consuming and major challenge that is difficult to manage without help in addition to the daily business?

Does the emotional attachment to one’s own company prevent a sustainable arrangement?

The reasons are complex and depend on the individual case and cannot be answered in a general way.

The motivational situation and the framework conditions in personal and financial terms on the part of the entrepreneur are complex. It depends on personal and professional factors. The resulting possibilities for the continuation of the business are manifold.

For successful business succession there is no blueprint, no master plan in which the entrepreneur enters data and receives a result or a guide to action. A successful business succession is an emotional, personal, complex, time-consuming and individual process.

Whatever prevents the entrepreneur from arranging the succession of his company, a view from the outside, an open, possibly unwelcome assessment of the succession options and the performance of the company and support in the decision and implementation of the succession will be necessary. When looking for a suitable successor to lead the company, it is not only professional competence that is decisive. The psychological aptitudes must also be equally pronounced. Outside support keeps the entrepreneur’s back free for the day-to-day business.

During the preliminary considerations, the decision, the implementation, and the support after the succession regulation has been completed, an experienced, emphatic, practical person should be at the side as a pacemaker, coach, pilot and close confidant.

My support is characterised by the will to help the entrepreneur achieve his or her goal. I will present concepts that have been developed together with the entrepreneur and then accompany the entrepreneur in the implementation.

Accompanying the decision-making process in 4 phases