Time passes way too quickly. With the blink of an eye, another year is almost gone. For those of you who had resolved to begin the succession planning process this year, it’s not too late. Northwest Farm Credit Services has two webinars that are informative and an easy way to start:
In this 45-minute webinar, NW Farm Credit’s Michael Stolp and Carl Sohn focus on ways to improve communication among family business constituents. Communication is the linchpin to the complicated relationships involved in family-owned businesses. Both Michael and Carl are the product of family-owned farms and share their valuable insight on common conflicts, difficult conversations, and techniques to help make family decisions together. These challenges and the tools to meet these challenges apply to all family-owned businesses, not just those involved in agriculture.
This webinar is an excellent summary of the succession planning process. Rich Thornton of Moss Adams leads a 30-minute overview and preview of NW Farm Credit’s January 21-23, 2016 seminar in Richland, Washington. In Rich’s view, these are the chronological steps for successful succession planning:
- Financial and Strategic Planning for the Business. Increased competition and complexity of business operations make this priority Number 1.
- Personal Financial Planning. Where owners have diversified their financial positions, often in slow steps over many years, the ownership transition component of succession planning becomes much easier.
- Management Transition Planning. Good management is key for daily and future operations of the business. Without solid management in place, successful ownership transition is nearly impossible.
- Business Estate Planning. Personal estate planning must align with business realities. For example, is there a sufficient cash flow to accomplish the estate plan?
- Ownership Transition Planning. Some may find it odd that the transition of ownership is the last item on the list. Historically, this has been the first area of focus, often contributing to huge challenges to the viability of the family business. If tasks 1-4 are in good order, the decision on how ownership transfers becomes much easier.
Remember, succession planning is a constantly evolving process, not a once-and-you-are-done project. Small steps today will make a big difference.