INTHEBLACK October 2021 - Magazine - Page 63
STORY AMANDA WOODARD
FOLLOW
MY LEADER
THE TASK OF HANDING OVER A SMALL BUSINESS TO A SUCCESSOR
IS ONE THAT TAKES CONSIDERABLE TIME AND EFFORT. FOR MANY
SMALL BUSINESS OWNERS APPROACHING RETIREMENT AGE,
SUCCESSION PLANNING IS THE NEXT BIG-TICKET ITEM.
S
mall and family businesses have been
the backbone of the global economy for
decades. In Australia, small and medium-sized
enterprises (SMEs) make up about 70 per cent
of all businesses – about half a million – and employ
about 50 per cent of the workforce.
Forward thinking has not been a hallmark of SMEs
when it comes to succession planning. Craig West,
founder and CEO of Succession Plus, says SME
owners are simply not used to having conversations
around succession. “In their heads, they think: exit,
retire, die – so they avoid the conversation.”
The scale of the problem is staggering – a recent
report from KPMG Enterprise and Family Business
Australia (FBA) has found that 54 per cent of family
businesses have no documented succession plan in
place. Given that more than 60 per cent of SME owners
are approaching retirement age, it would seem many of
them are sleepwalking into an uncertain future.
FAMILY DYNAMICS
Amanda Greer’s family is currently working through
succession planning with the help of FBA.
Her parents founded the Stainless Steel Wire and
Mesh business in 2002 in Melbourne, where she
works as business development manager. Greer and
her two siblings have worked for the firm for nearly
a decade, but it is only in the past two years that they
have begun to take over management as their parents
prepare to take a step back from the business.
From an emotional point of view, Greer
acknowledges that the process is a difficult one
for her parents and that any transition needs to be
accommodating to their needs.
“Succession is a process, and we are still finding
ways to support our parents. You can’t just flick a
switch off.
“Mum and dad set up the business around the
kitchen bench. They have taken all the risks and
worked incredibly hard. It has been a huge part of
their life – their fourth child in our case – so to move
on is really hard, but it is important,” says Greer.
Difficulties can arise when the knowledge capital
and expertise of a business are invested in the owner
and CEO, making them indispensable. Greer is
aware of this in her own family business and explains
that her father is transitioning into a strategic role,
working on the business rather than in it, which
has allowed her and her siblings to “draw out” his
knowledge.
“My parents don’t realise what they know until they
have to pass it on,” says Greer.
Key to the transition has been engaging an external
facilitator to kick-start the formal succession planning
process.
“The facilitator acts as a circuit breaker and brings
energy, experience and knowledge. We have learned
simple but effective tools to work through difficult
conversations and conflict, such as the ‘pause button’
if things are getting tense. We have also learned to
rewind and reflect on how we could have improved
on things we have done,” says Greer.
For the employees, too, it has been reassuring to
see that succession planning is happening, as they
know their jobs are secure, says Greer. “People value
the culture of working in a family business. It’s so
important to have a good plan and for the staff to be
involved and part of that process.”
intheblack.com October 2021 63