How to take your family business to the next level

SMEs are often described as the backbone of Australia, and a large subset of SMEs are family-owned and run. But just because a first-generation family business has grown and thrived, that doesn’t mean it will continue to prosper when a second generation takes over. Successfully making that transition requires strategic planning.

Many family-owned companies fail when they let family conflict and emotion drive change, rather than relying on proven strategies. And it’s never too early to put those strategies in place. It’s important to note that succession is not a singular event, but a process of transitioning the family business to its next stage of development.

How to transition business decision making to the next generation

Two key transitions need to take place. The first is handing over the most senior decision-making roles to the next generation, and the second is assigning ownership and control of the business.

At Icon Visual Marketing, we’ve worked with many family businesses over many years, and here are a few key things we’ve learned that all family businesses can benefit from following.

Start early

When it comes to transitioning the family business from one generation to the next, the sooner you start planning, the better. Continuity and planning are critical for achieving a long-term legacy. A very well thought out strategic plan provides much-needed stability to the family business management without any challenges and tensions during the passing of the baton to the next generation of family members.

A strong and successful continuity plan must identify the challenges that will be faced by the siblings, cousins, and large groups of business owners and shareholders.