On Monday of this week I got up at 4am local time to watch the State Funeral of Queen Elizabeth II. As a Brit, who now lives in the US, it was important to me to witness this historic event. Like most of the population of the UK I have never known anything other than having the Queen on the throne.
Watching the pomp and circumstance that the British do so well with the military parades and worship services at Westminster Abbey and St George’s Chapel at Windsor Castle, I was struck by how perfectly organized everything was down to the minutest detail. This does not happen without a lot of forward planning, preparation, and practice. In this case over many years.
When I am speaking as a succession planning keynote speaker or advising a coaching client about the future leadership of their business, I always tell them that starting early and planning long term are crucial for a smooth transition from one generation to the next. The British Monarchy provides an excellent example of an institution that manages to evolve over time but also has a clear succession plan for the long term.
Here are 5 lessons that business owners can learn from the Royal Family:
1. Start Early: For the Royal Family training starts from a young age so even as small children they are exposed to formal events and taught protocol. I advise my business owner clients to think at least 5 to 10 years in the future.
2. A Gradual Process: Prince Charles was probably the best prepared monarch in history as he is now in his seventies and has been preparing to become King all of his life.
Most business owners do not want to think about succession planning and wait until the last moment before they retire to start the planning. This is one of the main reasons why only about 30% of family-owned businesses in the U.S. transition to a second generation. Approximately 10-15% are passed down successfully to a third generation, while only 3-5% survive to a fourth or beyond, (Businessweek.com, 2010). It is far better to have identified a successor in your business who can gradually take on more responsibility over time until they are ready for the top job.
3. Clear Communication: Everyone knows who is next in line for the throne. Prince William is now the Prince of Wales and will be the next King of England when he succeeds his Father. Do you know who is next in line for your business? If so what have you done to prepare them for their future leadership role?
4. Conflict is Normal: As with all families the Royal Family have their internal conflicts. This is not unusual, particularly with a family business. Understanding that this is a normal part of finding the best long term solution. Outside advisors can mediate and help to achieve a strong and effective succession plan.
5. Focus on the Main Goal: In this case, it’s the continuity of the monarchy but for most business owners it is a choice between i) continuity within their own family, ii) bringing in outside professional management or iii) selling the business either as a whole or partially.
This can be a tough decision when it is your life’s work and legacy. Rather than agonizing about it in isolation a trusted advisor who has experience in this area and can help you to make a decision that gets you where you ultimately want to be.