Ellen starts a business from scratch with money borrowed from family and friends. For the next ten years, she devotes her life to building an innovative business. Strong-willed, she accepts leadership from few people.
This kind of tenacity in an entrepreneur is admirable. But, unguarded strengths can become double weaknesses. Such is the case with Ellen. She never worked to have any plan for the day when she would not lead the business.
Anticipating the time when someone else would assume the company's leadership never happened. What should have been an annual discussion never took place.
Even when her daughter Jane finishes school and joins her in the business, there is no annual discussion with stakeholders about a preferred picture of the future. Her daughter is never asked to share her role in that preferred picture of the future.
After five years, Jane becomes anxious to know her ownership share in the business. She presses to understand her role in the future of the company.
Never having initiated this discussion, Ellen is caught off guard. Ellen has not lived to understand that there is no success without a successor. Like many founders, she cannot even consider anyone else in her position.
The discussions are emotionally tense and end in a stalemate. They even seek professional opinions to help them. The issue is ultimately about control. Ellen constantly rehearses the sacrifices she made to start the business and how easy Jane now has it.
There is now distance in their relationship. A growing understanding that they can no longer work together seems to take hold.
Shortly, one will have to go.
Ellen's story highlights a common problem for entrepreneurs in succession planning: failure to start early enough.
Had Ellen begun having an annual discussion about a preferred future for her business earlier, her daughter would have had ample opportunity to share her feelings. Never having had these discussions leaves Ellen blindsided by her daughter's hopes and emotions.
An excellent framework for succession planning for these two women is:
Start ten years out thinking about a preferred picture of the future and share it with your stakeholders and advisors.
Press them to know their preferred picture and their role in it.
Develop a pool of possible successors. Make room for them by trusting them with increased responsibility.
Steep them in the values you want to succeed you to sustain your purpose.
When you are ready, take some time off and away from your business to make room for your possible successors to grow. Use these seasons to mentor and develop them.
Make it an annual ritual to share the values you want your obituary to reflect with your team.
Remember, there is no success without a successor.
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