Contingency Planning – If Disaster Strikes Are You Ready?

 

Learning to anticipate common family business issues can avert a future crisis

Usually we think of a founder’s health, or worse, death, when we think of contingency planning in a family business crisis. But reading the recent news there are other situations that can affect us almost as much.

FERGUSON, MISSOURI “IT’S A WAR ZONE OUT THERE”

How would your business continue to operate if there was civil unrest in your town. It doesn’t even need to be your location that is affected but a major market where your customers are.

DEMOULA’S MARKET BASKET FAMILY FEUD: COMPANY BOYCOTT

What happens when the conflict between two sides of a family escalates to the point of a work stoppage and customer boycott. In the Demoula’s case the employees and customers supported a boycott of the company when the board changed family management.

How Would Your Family Business Cope in a Crisis?

The above examples are extreme and not likely to happen in your family business. More likely your issues will involve the health of the founder, family conflict or a financial event.

The key is to identify, anticipate, and contingency plan for family business crises in advance. More…

Kicking the Can Down the Road – No, Not the Federal Budget, I Mean Succession

The government’s decision to avoid further conflict on the debt crisis by putting off key budget reform until next year, reminds me of family businesses who put off succession planning until it reaches a crisis.

Many family businesses avoid succession planning discussions and allow it to just happen. However, unlike the budget, succession planning does eventually happen in one way or another.

The biggest reason we avoid succession planning is it forces us to discuss the most sensitive issues and make even more difficult decisions. This often leads to increased tension and hurts relationships within the family. The perception is that the business consequences of avoiding the issue aren’t worth the personal consequences. More…