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ARTICLES
Business Week "Small Business" November 2, 2000 Smart Answers by Karen E. Klein When It's Finally Time to Turn Over the Reins It's not always easy for a long-time owner to start looking for the exit. Here are some tips for planning a peaceful succession Q: I'm an 83-year-old engineer and inventor. I need advice on hiring a salesman and eventual successor, so my 50-year-old company can continue after I retire. ---- Henry G. Dietz, Long Island City, N.Y. A: Do you truly want a successor? It's wonderful to stay productive and vital, but if you are just now looking for a successor at age 83, one has to wonder whether you are so tied to this company that subconsciously you feel no one can take your place. Visualize yourself separating from the company -- that may help you get serious about selling or turning over the reins, says family-business specialist Quentin Fleming, of Santa Monica, Calif. "Think about your next phase of life and picture yourself in another role, perhaps as a professor or an adviser emeritus at a high-tech incubator," Fleming advises. To start the succession search, you must define your business and articulate the skillset needed to apprentice and eventually run it. In many cases, company founders have never written down exactly what they do or defined their roles. In order to do this thoroughly, you may need help from a business consultant who can bring an outsider's viewpoint to the process, says Peter Cowen, an investment banker with Peter Cowen & Associates in Westwood, Calif. If none of your current employees fits the bill, take your successor profile to people who can refer candidates. Start with universities -- New York University and Columbia are obvious targets -- and contact engineering and business professors, Cowen advises. He also recommends talking to money managers and executives at banks, law firms, and accounting firms. Don't forget to seek input from other entrepreneurs. In fact, ask everyone you contact to help spread the word. "If the business is sound, then this is a terrific opportunity, and people will be eager," Cowen says. Transitioning out of a company can be a lengthy process, so don't dawdle: It's time to get to work. |
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