February 2017

A23 A1-A44 B1-B24

Page A23 FEBRUARY 2017 FUNERAL HOME & CEMETERY NEWS S ec t i on A
Businesses across the Unit-
ed States are facing the po-
tential for great change in the
next one to five years, partic-
ularly family businesses. Cur-
rently, the mean age of fam-
ily members in control of the
family business in 2017 will
be 60.2 years. Clearly, transi-
tion is coming. It is estimated
that more than 40% of fam-
ily business leaders in 2017
are expected to retire within
five years, which will lead to
succession, sale or merger of
Family Business and Funeral Homes (Part 1) By Larry Grypp
Larry Grypp
ents, children who are working in the business, and oth-
er non-family business leaders, it is likely that the affected
parties are operating under different assumptions. I have
seen businesses that neglected to formally name a succes-
sor or failed to take the time to discuss the desire for transi-
tion with the individual they had in mind to succeed them.
Communicating with, and developing your planned suc-
cessor is paramount, asking them first if they are interest-
ed in taking over, determining if they are ready to assume
the role and defining what the stages and timing for transi-
tion are. With this clarified, it is equally important to com-
municate the decision with all stakeholders inside and out-
side your business. Naming your successor isn’t an event,
it’s an ongoing discussion that takes place over time, and
the ultimate communication will include your banker, ven-
dors, customers, and of course, team members at all levels
of your organization.
Education
Having presented the family business as a fulfilling option
for your children, be certain to leave room for the discus-
sion of your child’s fears, doubts and excitement. Educate
your successor about the challenges of leadership and pre-
pare them to be responsive stewards of the business. Here is
the opportunity to share the family’s “secret recipe,” dem-
onstrate your trust and believe in the person and the pro-
cess. It is also important to generate a bench of talent that
can assist to facilitate a smooth transition. Open communi-
cation will keep other key family members and staff aware
of the process and encourage their input.
Over the next couple months we will continue to examine
the three elements of transition for the family or private busi-
ness. An underlining theme throughout will be communica-
tion. Asking questions leads to clarity and that clarity leads to
commitment. Without sharing information, all is lost. I en-
courage you to embrace the change and make the most of it.
Larry Grypp is president of the Goering Center for Family &
Private Business, an affiliate of the Carl H. Lindner College of
Business at the University of Cincinnati. Established in 1989,
Goering Center serves more than 400 members, making it the
country’s largest university based educational non-profit for fam-
ily and private businesses. The Center’s mission is to nurture and
educate family and private businesses to drive a vibrant economy.
Find them online
For assistance with succession planning and other issues unique to
family businesses, visit the Goering Center website for a comprehen-
sive listing of family business centers across the United States.
the business.
As only 30% of family businesses pass to the second genera-
tion, this may be your family’s first leadership transition. At
the Goering Center, we have assisted many family and pri-
vate businesses with the evolution of leadership and owner-
ship. There are three key components to the initiation of a
successful family business transition: introduction of a succes-
sion plan, creation of an ethical will and being willing to ask
for assistance. Over the next three months we will cover each
section individually to plot your succession path.
Let’s start with the planning. As with any project, a pro-
cess is important to provide stability and continuity. Your
process sets expectations, defines clear measures and es-
tablishes milestones. The plan will keep everyone on the
same page, aligned around what needs to be considered
and how everyone is accountable to that.
Make a Plan of Action
When passing the torch, it may be difficult to determine
when the time is right. Establish a date for when you want
the transition to officially start and set a flexible target
date for conclusion of the process. When done well, the
process requires years of adequate preparation and several
more years to implement. It helps to build a team of pro-
fessionals who can advise you on the legal, financial and
ethical steps that need to be taken, not just for the benefit
of the family, but for the benefit of the business. You will
want to evaluate if your current advisors are the right ad-
visors to help you navigate these succession waters.
Name Your Successor
Some families assume that the successor is a forgone con-
clusion. Absent clear communication between owner/par-