One of the toughest challenges in estate planning is to plan for the transition of a business when the founder is gone. There are so many business and financial, as well as psychological and emotional, aspects to consider. That’s the reason most put off doing business succession planning. They just don’t want to open that can. However, as my colleague Tom Rogerson often says: “Failing to plan is planning to fail.” Failing to carefully plan for the continuity of a business often leads to a bad outcome—bad for the owners, bad for the family, bad for the employees, bad for the customers, bad for the suppliers, bad for everyone involved.
Because of the reluctance of business owners to plan for who will run the business WHEN (not IF) they are gone, I am launching a segment of my Family Legacy Planning Series devoted to Business Succession Planning. In the coming weeks, we’ll explore the do’s and don’ts of succession planning. We will study real life examples of families who did it right and families who did it wrong, learning from their successes and their failures.
Interestingly, the idea for this segment on business transition planning came to me when hearing a sermon from Rabbi Zev Weiner. While in Los Angeles to celebrate our granddaughter Juliet’s 8th birthday, we attended Shabbat services at Young Israel Synagogue. I learned that the Gemara (Rabbinic commentary) teaches why Jewish law on divorce comes BEFORE the Jewish law on marriage. Rabbi Weiner explained that all endings (whether it be divorce, death, job termination, or even the end of a month) are viewed in Judaism as new beginnings. Upon any such ending, the focus is to look to the opportunities that lie ahead, opportunities to start over, find happiness, renewal, rebirth. That’s why marriage teachings come AFTER divorce teachings in Jewish law.
It then dawned on me: the death of a business founder brings an opportunity for business continuity, perhaps even improvements, expansion, a better way. It also creates the opportunity for the founder to create a lasting legacy that endures for generations to come. A life ends, but a legacy begins.
By the same token, TV producer Norman Lear recently celebrated his 100th birthday with two words of advice: “over” and “next.” When something is finished, declare it OVER and don’t dwell on it. Immediately move on to what comes NEXT. That philosophy has served Norman Lear well, a man who continually recharges his creative juices and is still working in his 101st year. But when his time is over, someone else will pick up where he left off and bring on what’s next. Similarly, when any business founder’s work is “over,” it’s important to have a plan in place for what comes “next.”
I look forward to diving deep into business succession planning and exploring all the opportunities it offers.
Marvin E. Blum
Marvin Blum’s granddaughter Juliet celebrates her 8th birthday, marking the end of one year and the beginning of another, filled with the promise of new opportunities.