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Family Business Matters 04/15 04:57
How To Cope With Succession Anxiety Disorder
Chances are that somewhere in your future, your business will experience an
ending, split or dissolution. You may not want to think about the inevitability
of an exit, but being prepared can be instrumental for positive family
relationships.
Lance Woodbury
DTN Farm Business Adviser
Succession is notoriously difficult. Figuring out how, and when, to
transition the ownership of farm and ranch assets takes having the knowledge of
what you want to do, the right experts to help you do it and following through
on your intentions. Furthermore, handing the management of your business to the
next generation takes confidence in their skills, clarity about your own future
role and a willingness to let go.
In short, the transition is hard, and for many producers, a formal
succession plan remains elusive and overwhelming. I call the angst surrounding
the succession process "Succession Anxiety Disorder."
While contemplating this now-named condition, I came across Chip Conley, an
entrepreneur who works with people going through mid- and late-life
transitions. Conley developed a set of 16 "Emotional Equations" (explained in
his 2012 book of the same title), describing the cognitive processes our brains
experience that create emotional responses. I found two equations particularly
relevant to the family business succession process.
Disappointment = Expectations minus Reality
When things don't go well, when you are disappointed in the outcome of a
situation, it is primarily due to the gap between what you expected to happen
and what actually occurred.
Take the case of a younger family member returning to the farm. The senior
generation suggests the younger generation member should return and that he or
she will "end up" with the farm. The younger member is excited and eager to
come home. In many cases, that is as far as the conversation goes. There is no
discussion about the timeline of the transition, the parents' economic
expectations for the change or how the financial terms will be settled with
off-farm siblings. The younger generation is expected to simply trust that it
will all work out.
In the absence of a specific plan, the younger generation begins to develop
assumptions around how the handoff should work. Later, their expectations meet
the reality of the parents, who may have developed a very different idea, plan
or set of assumptions. Worse, they may not even want to talk about the future
or the details of their arrangement. They may not even have a plan. The result
is a tremendous amount of disappointment and often conflict between the
generations because of the gap in expectations by the younger generation and
the reality of the parents' strategy.
Anxiety = Uncertainty x Powerlessness
In this equation, not knowing what the future holds is multiplied by an
inability to do anything about it. Conley suggests these two concepts should be
multiplied, because the resulting anxiety is bigger than either uncertainty or
powerlessness alone.
Family members who experience anxiety might develop severe conflicts with
those with whom they work or live. They may shock the family with an addiction
or mental breakdown, or initiate destructive behaviors toward themselves or
others. These behaviors may, in part, stem from stress caused by uncertainty or
mixed signals around how or when their transition into, or out of, ownership or
management will occur. A lack of clarity or unrealistic expectations about what
role they will play may also exist. Multiply this uncertainty with an
inability (real or perceived) to influence or control the transition timing,
strategy or outcome.
Young or old, they feel totally helpless, maybe even trapped in the family
business as it stands today.
Taken together, Conley's two equations shed light on why succession may be
difficult. The gap between expectations and reality in transitions, and the
uncertainty and sense of powerlessness during the process foster anxiety in the
family. If your family can recognize and discuss Succession Anxiety Disorder,
you'll be better at alleviating the condition.
Lance Woodbury can be reached at lance.woodbury@pinionglobal.com
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