Study identifies eight key principles of succession in a family business
CHICAGO (March 13, 2014) – Results from a recent global research study conducted by Baker Tilly International, a leading global network of independently owned and managed accountancy and business advisory firms, show that internal harmony is a key consideration across all stages of the family business succession process. The survey found that 68 percent of respondents indicated it was important before starting the business succession planning process, rising to 75 percent after the process was completed. Independent network member Baker Tilly Virchow Krause, LLP (Baker Tilly) is a participant in the global study1.
“It is our opinion that family businesses valuing trillions of dollars will change hands over the next decade as the baby boomer generation passes their businesses on,” said Baker Tilly International President and Chief Executive Officer Geoff Barnes. “Many of those retiring currently have no succession strategy. To achieve the best possible outcome, owners need to understand the many complex family, individual and business issues that must be addressed in the succession process.”
The interim findings of the Baker Tilly International Global Business Succession Survey collected confidential and anonymous feedback from 1,650 people across 55 countries and in nine languages before, during and after their business succession processes. To address the complex structures of family businesses, the survey’s findings have been condensed into eight principles of succession, intended to be a practical guide to how family businesses should view and conduct their succession process:
- Succession is not retirement
- Start with readiness
- Set your goals before the journey
- Price is not first
- Harmony is a must
- Plan early, start earlier
- Equality of not equal
- Ask before you get lost
“Creating, sustaining and enhancing harmony through the succession process is a must. In engaging with family and other persons involved in succession, business owners must recognize that those involved are seeking certainty about the process and about their future,” added Barnes. “They need to feel a sense of contribution and that there is a positive outcome where there are opportunities for individual growth.”
The Baker Tilly International Global Business Succession Survey, Future Proofing the Capital Value of Your Business, is focused solely on the issue of succession and is structured to focus on the dynamics, barriers and success strategies experienced in a succession process. It provides alternative views of how one’s experience varies across the journey of succession by considering respondents’ experiences from three perspectives:
- Succession process completed
- Succession process in progress
- Succession process not yet commenced
The findings from the survey are interim results and will continue to be refined and explored as the survey continues.
About Baker Tilly Virchow Krause, LLP (bakertilly.com)
Baker Tilly Virchow Krause, LLP (Baker Tilly) is a nationally recognized, full-service accounting and advisory firm whose specialized professionals connect with clients and their businesses through refreshing candor and clear industry insight. With approximately 2,700 employees across the United States, Baker Tilly is ranked as one of the 15 largest accounting and advisory firms in the country. Headquartered in Chicago, Baker Tilly is an independent member of Baker Tilly International, a worldwide network of independent accounting and business advisory firms in 147 territories, with 33,600 professionals. The combined worldwide revenue of independent member firms is $3.4 billion.
About Baker Tilly International
Baker Tilly International is the world’s 8th largest network of independent accounting and business advisory firms, by combined fee income of its independent members. Every day, over 27,000 people in 161 member firms in 137 countries provide accountancy and business services to entrepreneurial, growing businesses and corporations worldwide.
1Within the U.S., the following Baker Tilly International member firms are participating in the Global Business Succession Survey: Accuity; Baker Newman Noyes, Baker Tilly Virchow Krause; BlumShapiro; Cherry, Bekaert; Frank, Rimerman + Co; Habif Arogeti & Wynne; Mountjoy Chilton Medley; ParenteBeard; RubinBrown; Windes & McClaughry Accountancy Corporation.