Involve your children in your business because if you died now....
The reality of life we keep forgetting intentionally or unintentionally is that everything that has a start has an end and that includes life it's self.
Yesterday I was discussing business succession with a colleague. The discussion started off with a story of a certain prominent businessman who died and left everything behind only for the kids to sell every thing in the next two years and now they're struggling to survive.
He also gave me examples of many rich men in town who are facing a succession dilemma. They have good businesses, they educated their kids abroad and some even got permanent residence in those countries showing no reason of returning home to take over their parent's enterprises.
This has left the old men and women frustrated.
We've seen this many times. Many business men and women don't involve their kids in what they do so the kids grow up detached from what their parents are doing and it gets had to introduce it to them in the future when their priorities in life are else where.Many business men don't run structured enterprises, meaning everything runs around them so when they die they go with everything.
I have a friend who has a supermarket and during holidays all of his kids get involved in running the place from the youngest to the oldest. From customer care, to managing the store to handling the cash and he pays them for it.
He says that's how they make their pocket money. Rather than just give it to them he makes them work for it so they can appreciate the reality of life, that money is worked for not just given. He also wants them to understand how to run the family business so that when they (parents) aren't around they can comfortably continue with the business.
This is what Indians do and thats how they run very successful family businesses over generations.When you start a business have an exit strategy in mind. Don't let it happen surprisingly without preparations as the business will be hit by the shock and may never recover from it.
I know people say I love my business so much I will never exit it but truth is at some point you'll be too old to continue. Hate it or love it at some point you'll die and if you don't have a clear succession plan or exit strategy your business will die with you.
If it's a family business, involve your kids. Identify the ones that are most interested in continuing on with the business taking over from you and train them to love and run the business over time. If it's not a family business then at some point bring partners on board or make it public.
Let other people buy shares into the business so that even when your away the business will continue. Steve Jobs died but apple kept growing stronger even after him. They became a trillion dollar business and are heading to become a 2 trillion dollar business in US dollars.
Have a structure, this enables the business to operate independent of any particular individual. A management structure, with a board of directors or even board of trustees. Then you can not worry about whether your kids want to carry on or not. The business can carry on and they can get their dividends/share whilst doing other things they wish to do.
We don't have wealth management firms here like it is the case in America and Europe but you can leave your business in the hands of such firms with clear legal instructions and understanding and they can manage your wealth, business inclusive in your absence giving every one you left behind what they're entitled to get from what's been left behind.
Unfortunately many of our old school rich men and women don't do this hence when they die there's no formal structure to carry on from them hence everything gets mismanaged and abused till it dies off too. Many chose to prepare for they're kids instead of preparing their kids and when they die the kids aren't prepared to even handle what's been prepared for them.
If you want to build a business that will live way after you've gone start building the structures now. Involve many people in various capacities. It may seem to early to do that but when you don't it may be too late when you remember to do so.
You'll end up having to hang on even when you have to hang up your gloves simply because your struggling with the succession and continuation dilemma.
If there's one thing you should start doing in your business next year, it's building structures
Jaluum Herberts Luwizza is a Speaker,Writer and Contributor with the Nile Post. He is also a Business Consultant at YOUNG TREP East Africa's No.1 Business Management and Consultancy firm that helps people start and grow profitable businesses.
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