Succession planning and stewardship in family business

Picture of John Broons
John Broons

John Broons is a globally awarded family business expert. One of only three people in Australia to hold the coveted title of Fellow of Family Firm Institute (Boston, USA), John has dedicated his working career to answering the question: how do I guide and support families in business to a place where they’re thriving?

I have found that many family businesses often lack the necessary preparedness for a smooth succession of ownership. It’s a surprising reality that can have long-lasting consequences for the future of these family businesses. Today, I want to shed light on the importance of succession planning and introduce you to an alternative approach: stewardship. By exploring the differences between the two and emphasising their significance, I hope to inspire family businesses like yours to create a solid foundation for transferring ownership and ensure the legacy lives on.

A family owned Pizzeria
Unravelling succession and stewardship

Let’s start by unraveling what succession and stewardship truly mean. Succession, in its simplest form, refers to the passing of a position or property through a sequence, often involving the next generation of family members. On the other hand, stewardship highlights a different perspective, focusing on the role of a caretaker or surrogate who oversees and protects something of great value. While succession may be a common term, stewardship introduces a fresh perspective that goes beyond a mere transfer of ownership.

Stewardship: Preserving values and culture

As family business leaders, you have an inherent desire for more than a simple succession process. You strive for stewardship – a way to ensure that your business continues to make a positive impact on the lives of various stakeholders, including your dedicated employees, loyal suppliers, valued customers, and the communities you serve. Stewardship allows you to pass on more than just tangible assets; it enables you to preserve the values, traditions, and culture that define your business and make it truly extraordinary.

While succession often focuses solely on handing over ownership, stewardship encompasses much more. It carries the responsibility of nurturing relationships with stakeholders, fostering a sense of purpose and legacy within the business, and navigating the challenges that come with growth and change. Stewardship is about preserving and growing what your family has worked so hard to build, while also adapting it to the evolving needs of the modern world.

Succession planning and stewardship are two sides of the same coin when it comes to the transfer of business ownership. Succession ensures a smooth transition, while stewardship guarantees the continuity of your business’s impact and legacy. By combining both principles, you can create a solid foundation for future generations, ensuring their success and the perpetuation of your family’s proud heritage.

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