Your Company: The Next Generation
“That may mean that they continue with the company,” Ellis says, “or that they are leaving. But for the ones that are leaving, have an exit strategy for them.” If people know that in six months they’ll be gone, they have the opportunity to plan for another job. “You can help them to find a job, or, in some cases, you’ll need to give them a severance package.”
There’s an emotional element that comes into play, as well. After 18 years in business, a large portion of DBL employees had strong relationships with Lorsch. “It wasn’t that they were saying goodbye to their jobs; they were saying goodbye to the owner of 18 years," Kuperman recalls. "When the owner does leave, those people who’ve been with him the longest need the most attention. They’ve come to rely on the owner very strongly.”
Family Ties: How Tight?
At burton + BURTON, a balloon and gift products supplier based in Bogart, Ga., owners Bob and Maxine Burton don’t include selling the company in their succession strategy. Their son and daughter began their careers working outside of the company, and both are now working in the family business. But this doesn’t mean they'll be the eventual successors.
“The next generation is starting to come into the business, but we’re not opposed to professional management,” says CEO Bob Burton. “It doesn’t have to be a family member; we just need people that can run the business.”
With a staff of about 350, the Burtons began laying the groundwork for succession years ago. “We knew we needed someone that had some corporate background and management experience,” Bob Burton explains. “Once you get to a certain point, with a certain number of customers, you realize that there are folks out there that know some things that you don’t know.”